KHARTOUM: North and South Sudan face disputes over sharing oil revenues and calming border regions after southern independence in July as both nations seek to overcome serious economic challenges.
Sudan’s south became independent on July 9 after voting in a January referendum agreed under a 2005 peace deal to part from its former civil war foe.
But they have so far failed to sort out major economic issues such as dividing oil revenues and other assets, coordinating the launch of their new currencies and resolving disputes over the border or the contested Abyei region.
Assets at stake include millions of acres of fertile land, gold, oil and the waters of the river Nile.
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Southern President Salva Kiir is expected to visit Khartoum in October in his first visit since southern independence to try end disputes with the north, allaying fears of a return to civil war. But both sides have failed to reach an agreement how to divide up oil revenues, the lifeline for both economies. Around 75 per cent of the country’s 500,000 barrels a day oil production now comes from the South.
The South is seeking to pay less than the 50 per cent transit fee agreed under the 2005 peace deal but needs to use the North’s pipeline, refineries and port to sell the oil.
Both sides have also failed to coordinate the launches of their new currencies, which is hampering cross-border trade. On the political front, both countries have not reached an agreement on the contested Abyei region into which the north sent troops and tanks in a power play in May, triggering the exodus of tens of thousands civilians. The UN Security Council has now deployed Ethiopian peacekeepers to Abyei but the Sudanese army has not withdrawn yet.
Fighting between the northern army and armed opposition in the border area spread to the northern state of Blue Nile neighbouring South Kordofan where fighting broke out in June. The joint border needs marking, too.
After years of relying on oil revenues, which make up more than 90 per cent of Sudan’s exports, the growing import bill has caught up with Khartoum. Banks are unable to meet the demand for foreign currency in the country, forcing an effective devaluation of the Sudanese pound and driving up inflation. (UNI)