Sunday, September 06, 2015

Saving South Sudan's National Currency will fix the economy and reclaim the state

By Pursuit of Fiscal, Monetary, Property Rights, and Institutional Reforms

By John A. Akec

The Economy Caught between a Rock and Hard Place?

"South Sudan… there is no more country", runs the title of a recent headline article in New York Times. The article was read in Juba and, not surprisingly, life went on pretty much the same – business as usual. "The economy of South Sudan will collapse," pronounced Tom Lanzar, the former Assistant to the UN Secretary General for Humanitarian Affairs in South Sudan, after which he was declared non-persona grata, and politely asked to leave the country. These pronouncements were somewhat exaggerated, I must confess. However, it is for our own good not to dismiss such outlandish observations out of hand and go to bed undisturbed, without pausing for a moment to reflect. Who knows, they could be the tips of an iceberg.
The New York Times article exhibits a country gripped in damaging civil war in which the state appears to be losing its monopoly of violence with the attendant negative consequences on the effective administration of justice and the rule of law. It echoes the warnings of the great 17th century English thinker and apologist of a strong centralized state, Thomas Hobbes, in his magnum opus book, Leviathan, that: "The obligation of the subjects (citizens) to the sovereign is understood to last as long, and no longer, than the power lasts by which he is able to protect them…the end of obedience is protection." Namely, any inkling by the citizens that their state is not able to protect them enough leads to the termination of social contract with the state; that is, the citizens may decide to renege on their obligation to obey the sovereign. Instead they will decide to take charge of their own protection and that of their properties. It follows from there that most will live in continual fear and danger of violent death. With the result that, as Hobbes describes it, "the life of man [becomes] solitary, poor, nasty, brutish, and short."
On the other hand, Tom Lanzar's unfortunate pronouncements emanated from the persistent decline of the value of South Sudan pound against US dollar in recent months, with no evidence in sight as to the possibility of new fiscal and monetary reforms that would arrest the fall. Left unchecked, an uncontrolled depreciation of our national currency has the undesirable potential of ruining our economy through hyperinflation. In state of hyperinflation, prices of consumer goods increase by the day, and in extreme cases, by the hour. That is, what you bought in the morning could cost more in the afternoon. That, I believe, was the gist of Lanzar's message. Alarmist as it was, but not far-fetched.
The two verdicts (that is, the New York Times article, and Tom Lanzar's statement), hasty as they may be, are reflections of two faces of the same coin: war ruins national economy; bad economy leads to social unrest, undermines the rule of law, and the legitimacy of the state.
By taking measures that will halt further decline of our national currency, and quickly raising the revenue through taxes as we continue to search for a sustainable and lasting peace; this writer believes the sovereignty, ostensibly pronounced 'lost' by New York Times, can be reclaimed; the feared collapse of our national economy through hyperinflation, can be averted; and the many skeptics and doomsayers can thankfully be proven wrong.
Here, through the implementation of some radical economic reforms, everyone stands to gain, even those who perceive themselves 'losers' to the inevitable forces of creative destruction such reforms are bound to unleash. And let us be assured that doing nothing is no longer an option. Neither will half-hearted, knee-jerk prescriptions do the trick.

The Origins of South Sudan Economic Owes

South Sudan government income is mostly dependent on oil revenue (accounting for about 98% between 2005 and 2011; decreasing to 96% by December 2014; and dropping further to 60% by June 2015 of the total revenue).
Around June 2014, the monthly oil revenue stood at around SSP 360 million (USD 120 million) per month. By June 2015, it has halved to SSP 180 million (USD 60 million) per month, using Central Bank fixed exchange rate. The drop in oil revenue is attributed to drop in global oil prices per barrel from USD 101.2 in June 2014 to USD 50.7 in May 2015.
In the meantime, tax revenues rose from SSP 75 million per month in 2013 to SSP 120 million per month by January 2015. This brings the total government revenue by June 2015 to at SSP 300 million per month.
At the same time, the government monthly expenditure by June 2015 stood at SSP 900 million per month. This leads to a gap or deficit of SSP 600 million per month or shortfall of 66%.  
This hole in the finances is being closed through bank borrowing, which economic experts believe will undermine South Sudan economy in short, medium, and long term by making the national currency  worthless against other currencies. Bank borrowing or monetization of deficit was responsible for causing hyperinflation in Zimbabwe and in DRC.
What's more, the Ministry of Finance and Economic Planning has not been collecting much tax and tax income has been low because of the very narrow tax base (mostly customs and excises, and personal income tax of basic pay excluding allowances.) Many constitutional post holders such as government ministers, members of parliament, governors, commission chairs and members, county commissioners etc are not taxed. Hence, despite the potential for raising the government revenue through taxation are significant, and yet it remains untapped.

The Possible Remedial Options to Pursue

There are effective remedies that our country can pursue to address the recent financial challenges. It must come as a surprise to many that we have not been able, until now, to use them so far. It reminds us of Sirr Anei Kelujang's prophetic lines in his poem written in the late 1970s that reads:  "South Sudan do not be like little Gaak (bird) who died of thirst in rich field of ground nut by  River Jel; Nor be like the  Jalaba who died of hunger in a cage full of gold." (Kelueljang, The Myths of Freedom and Other Poems).
According to Kelueljang, Gaak ate plenty of peanuts and became thirsty; unable to locate the river close by, died tragically of thirst. The unfortunate Arab trader was locked up in a cage (goodness knows by who), and therefore was not free to benefit from his valuable possessions and died as miserable cage-prisoner.
There is a strong moral lesson for us in the tale of the poem. First of all, the options for resolving South Sudan's economic challenges are quite straightforward, and yet appear so illusive, so remote and so unattainable to our finance decision-makers. Vested interests have always made sure the attention of our government is deflected to other matters.

Unifying Exchange Rates

The first line of attack should be to unify the exchange rate. In other words, to move away from the fixed exchange rate policy that has been maintained by the Central Bank of South Sudan since 2005, and adopt flexible, market-determined exchange rate. The Ministry of Finance can ask central bank to pay for its monthly oil revenue the equivalent of today value exchange rate of SSP 14.5 to a dollar. That means for the USD 60 million per month from oil sale, the Ministry of Finance will fetch at least SSP 870 million per month. Add to that the SSP 120 million that is raised every month from customs and excises, and the Ministry will have in its account a sum of SSP 990 million. It means market determined exchange rate will bring in additional SSP 690 million of income per month and create a surplus of SSP 90 million that we can spend on other things.

The Impact of Currency Realignment on the Economy

An important implication for such a step is that there will be no need for the Ministry of Finance to borrow from the central bank to pay salaries and other expenditures. Every time the exchange rate goes up the Ministry of Finance will get more for its oil revenue. The effect will be that those hording dollars under their pillows will sell it to the Central Bank and the exchange rate will start to stabilize or even falls according to laws of demand and supply. Prices of consumer goods will also stabilize. The cost of imported goods will rise and in long term, and set in motion the pressure on entrepreneurs to meet the demand for some imported consumer goods locally. Markets will adjust and eventually stabilize. The pound will be saved, and with it, the country. We do not need foreign currency reserves in order to "defend" the pound; or is it in essence the defending the dollar? As some experts would want us believe. Waiting or doing nothing to stabilize the pound is not an option.

Increasing Tax Revenues

Raising taxes is the base on which all modern states are founded.
Hence, the Ministry of Finance and Economic Planning needs to raise more tax revenues in order to improve to meet its national obligations. Suppose we as a country did not have oil in the first place to pay our public servants and provide public services, how on earth were we going to survive? In fact, many countries such as Germany, Israel, South Korea, Switzerland, and our neighbours Ethiopia and Kenya do not have oil and yet enjoy thriving economies. How they do it? The answer is simple: they use taxation in different guises and forms in order to fund government expenses, build infrastructure, fund development projects, and maintain national security.
Following the examples of many countries that do not depend on oil and yet thrive, the government of South Sudan could make a conscious strategic decision to fund it budget through tax (and only fund a small part of  by oil revenue, preferably infrastructure project funding). Tax reforms should include, a centralized tax revenue authority, a progressive tax that does not exclude constitutional post holders, and at least 95% of taxes should be collected by the national government represented by National Revenue Authority.
For example, based on the current public sector pay of SSP 600 million per month, and assuming an average of 30% personal income tax rate on the gross pay of all the public sector employee through the Republic of South Sudan, the Ministry of Finance can take back at least SSP 200 million per month as tax which leads to total tax revenues jumping to SSP 320 million per month. Add this to the oil revenue of SSP 870 per month (using current market rate of one SS 14.5 to a dollar), the government revenue will total to SSP 1.19 billion a month or SSP 14.28 billion a year. With widening of tax base to include private sector income tax, value added tax on luxury consumer goods and telephone calls, tax revenues can be doubled or tripled. The government will have no difficulty rendering the services and protect us and our property because it will have the resources it needs. South Sudan will be once again bankable to international finance bodies such as IMF and World Bank. Lost friends will renew relations with us.
To sustain economic stability and spur growth, other measures need to be taken in order to improve economic governance and create attractive investment climate.

Property Rights Reforms

The National government must enact speedy reforms to regulate and control land property rights across out ten states and one administrative area; while making sure that communities displaced from lands for developmental purpose are adequately compensated. The notion that community own and control land is responsible for current conflict over lands, land grabbing, and insecure property rights that scare away foreign direct investment.

Setting Up New Institutions for Improved Economic Governance

To ensure better and more effective economic governance the following institutions need to be set us as soon as possible. These are:

Independent National Revenue Authority

To be set up as lead agency responsible for collecting taxes and identifying new opportunities for raising tax revenues and improving tax collection efficiency. It should be responsible for collecting 95% of tax revenues throughout the country.

Institution for Strategic Planning

Every country must have strategic goals that define where the nation wants to be in the next 3, 5, 10, 15, 20 years and beyond. What we do at present will bear fruits in the distant future. What we do not do at present can be a missed opportunity tomorrow. Hence, South Sudan can do better with a little more strategic thinking and less with groping in the dark.
For example, where South Sudan finds itself today in terms of shortage and high fuel prices is hardly an accidental misfortune, but rather the ultimate prize for not thinking and acting strategically five or seven years ago. It is a living proof of the cliché: failing to plan [strategically] is planning to fail [strategically].
Institutions for strategic planning are vital for the survival and future prosperity of any country. All forward-looking nations must have institutions that specialize in scanning the horizons for risks, threats, and opportunities; then prod the governments to plan and act well ahead of time upon the findings in order to minimize risks, reduce threats, and exploit opportunities. The government of South Sudan must set up a council for strategic planning that consults and works with academic and research institutions, think-tanks, and civil society groups to conduct policy analysis and compile reports that inform government strategic policy design and long-term development plans.
That also means the government should avail funds for think-tanks, research and academic institutions, and civil society groups to build up their capacity to play their role in socioeconomic development. And more important still, the government must act upon their analysis and findings.
The designated institution(s) for strategic planning should monitor how developmental projects are faring and frequently publishes reports (internal and public), meets with the legislators and executive branch of the government to discuss the status of progress of major projects and performance of the economy; thus enabling the executive branch to take informed actions and corrective measures in good time. The institution(s) of strategic planning need to have specialized committees or department within it dealing with specific issues and ministries. Its membership should include heads of specialized committees in the legislative assembly, among others.

 South Sudan Economic Advisory Board

A multi-disciplinary body with secretariat hosted in the Presidency or Cabinet Affairs and works closely with the Council for Strategic Planning and the Ministry of Finance and Economic Planning, Academia and Civil Society to make informed decisions that affect the economy in the short and medium term.

Financial Allocation, Monitoring and Evaluation Authority

This works closely with Council for Strategic Planning, South Sudan Economic Council, the Ministry of Finance and Economic Planning, specialized committees in the national legislative assembly, anti-corruption commission, office of auditor general, statistics commission etc. It should report and publish allocations and use of funds at least once or twice a year.


In order to move forward, three keys words are central to the success of any radical economic reforms in South Sudan: strong political will. Such a strong political will was demonstrated recently when the SPLM party leaders took brave steps to implement Arusha Agreement and reunify the party. SPLM leaders can demonstrate such courage once more time by taking measures that will bring about serious and speedy economic reforms, to rescue the South Sudan pound, and save country. We are at critical juncture: to thrive as a prosperous and free nation, or suffer the immense consequences of a contracting economy.

Wednesday, July 02, 2014

Decentralization and Federalism are Faces of the Same Coin

By John A. Akec*
A Week Cannot be Longer than Seven Days
If you catch cold and seek medical advice, it will take you only a week to recover from it; and if you don’t see your doctor, the cold will last for only seven days to get over. This was how we would quip during our beautiful school days when we saw a friend struggling with cold.  What is the point to be made here, you wonder?  Simply put, some things mean the same thing, because a week and seven days measure up to the same length of time (68 hours and 0 seconds). A one-week old girl is not older than seven-days old boy.

Federalism will be no more "Just" or "Fairer" than Decentralisation or Devolution
And in the same way, the disaffection with the implementation of decentralization clauses in our constitution has driven many of our citizens to call for the adoption of federalism as a better cure for our political injustices, be they real or perceived. However, from a personal perspective, this debate is nothing but war of synonyms. It is a vain attempt to reinvent the wheel when we have plenty in the store, to create a bone of contention when none existed, and to pretend to be innovating when the real term for this kind of futile exercise is "recycling" the old instrument.  

Many self-confessed federalists, I think, do not seem to realise that decentralization clause in our constitution is meant to address the same governance concerns that are tackled by different brands of federalisms applied in other jurisdictions. First, by bringing government closer to the people (as stipulated by article 36 (1) of SSC 2011, and Local Government Act 2009). Second, by devolving power to three levels of government: national, state, and local (article 47 SSC 2011). And third, by accommodating diversity in terms of cultures, beliefs, languages, values, and economic resources (article 48 SSC 2011). Finally (by implication and extension) reducing complexity of governing a large expanse of land; and installing systems of checks-and-balances in the way a country is run by the executive.  

It means, amongst other things, local problems will be addressed using local solutions that are conceived and crafted by local people; as opposed to centralized, one-size-fits-all prescriptions that are handed down from capitals to states; or from states to counties; or from counties to payams and bomas.

Those who believe that appending the term "federalism" to our constitution will add value to our decentralized system of government have not shown us as yet as to how this could be achieved, unless they have other definitions of federalism in mind, which they have not shared with us.

It all reminds me of the saying: "in the land of the blinds, one-eyed man is king." And in South Sudan these days, I have never witnessed such a large number of one-eyed men and women, (in form of politicians bored out of their bones for the lack of challenges, and lazy intellectuals masquerading as federalism experts), misleading such a large number of us. And that is not acceptable. 

What is wrong with Current Decentralisation Arrangements?
According to some of the opinion writers (Refer to Jacob Lupai's article in Juba Monitor, June 12, 2014): "The present centralized system dubbed as decentralization mostly favour none other than Dinka."
The writer goes on to point out the percentage of presidential advisors, the chairs of commissions, the undersecretaries, and security personnel who come from Dinka ethnic group as higher than those from the remaining 63 ethnic groups that make up South Sudan. And as a matter of fact, this was a correct observation (the relatively higher percentages of Dinka occupying high political positions cannot be questioned or denied). However, the writer misses the point about the yardstick by which the "strength" of a federalist system of governance is measured (it should by how much power is centralized and how much is devolved to lower local levels or concurrent).

Furthermore, assuming that federalism is measured in terms of representation of different states/ethnic nationalities in the central government, the writer should have acknowledged the fact that for every 10 South Sudanese, 4 are Dinka. That in South Sudan's 10 states, 7 states have Dinka population. And in order for any system to be just and fair, the distribution of political and economic power should be reflective of such asymmetries (the 64 ethnic groups forming South Sudan have sizes ranging from several millions to a few hundred individuals).

Moreover, and tragically still, according to this same school of thought, being "favoured" by a system is measured solely in terms of ministerial portfolios held by members of an ethnic group and not by distribution of economic benefits and service enjoyed by each community.

This is because the graduates of this school overlook the fact that 85% of South Sudan government revenue is currently spent in Central Equatoria State (Juba); that Central Equatoria continues to lead the whole country in most development indicators:  according to the 2009 statistical year book,  it is evident that that it had the highest level of children immunized in the country (43% compared to 12% in Warap State, and 6% in Northern Bahr El Ghazal); recorded the highest rate of primary school enrolment (20% compared to 2% in Warap and 1% in Northern Bahr El Ghazal); the second highest percentage (30%) of households with  access to improved water resources after Western Bahr El Ghazal which has 37%, but higher than 12% in Upper Nile, 7% in Jonglie, 2.3% in Eastern Equatoria, and 6% in Warap. This is to say nothing about the number of kilometers of paved roads in Central Equatoria or access to better health services compared to the rest of the country.

These prosperity indicators are better benchmarks for measuring economic and social inequality/equality in any viable country, as opposed to a ludicrous headcount of how many Dinka or Non-Dinka are occupying how many ministerial portfolios, all of which bear no correlation to how our various communities are faring on the ground.

Federal Systems are Many Types
Although many opinion writers acknowledge that federalism as a system of governance differs from one country to another, they fail to acknowledge the peculiarity of our adopted version of federalism as a natural consequence of our peculiar political and cultural ecosystem.
In the United States, for instance, the central government is referred to as the federal government. Federalism in the US was a result of the move by the founding fathers away from previous confederal union of semi-independent states, to a tighter union (the United States of America). In fact, in recent years, the US federal government powers have increased at the expense of powers exercised by the states. The state governors in the US are democratically elected as they are in South Sudan. The federal government controls one state (the District of Columbia). Attempts to surrender (more persuasive and makes sense) control of Juba metropolitan area to central government were stiffly resisted by Central Equatoria State.

In India, there are three types of lists for areas of jurisdiction for the central and state governments. The union list contains items on which Indian central government exercises exclusive jurisdiction; a concurrent list shared by both central and state governments (but if there is a conflict between two levels of government, the central government's jurisdictions prevail); and a third list, called state list containing items for states' jurisdictions. Furthermore, where national interests are threatened, the government of the Union of India can dissolve the entire state government. States of India do not enjoy equal representation in the Parliament but depend on demography. Doesn't it make sense to weigh in the population size of each ethnic group?
In Germany, the central government, also called the "federal government", is much stronger than the US federal government and many other known federations.  

In Australia, the states governors are appointed and not elected. Like India, there are powers for individual jurisdictions and others for common overlapping jurisdictions. The Central government is called Commonwealth government. A high court rules whenever conflict arises between states government and Commonwealth government. More often than not, and in many high level cases in recent years, the Australian high court ruled in favour of Commonwealth government. 

As we can see, there are varieties of federalist systems, each dictated by individual countries' needs with some similarities and differences here and there. The Western federal governments and their associated democratic and economic systems that are being emulated today everywhere are a creation of centuries of intellectual debate and political activism and governance that dates back to times of Socrates in Athens; Thomas Hobbes, John Locke in England, David Hume in Scotland; Montesquieu, Voltaire, Jean-Jaques Rouseau in France; Benjamin Franklin, Thomas Jefferson, and James Madison, Martin Luther King in the US; Karl Marx, and Emmanuel Kant in Germany; and list goes on to no end.

In contrast, most African systems of governance, including our own, are second hand models inspired by Western systems and values. Our systems of governance lack originality to the extent that they could be fairly described as "copy and paste" democracies that are yet to stand the test of time (with apologies to Justices John Luk). It will take us decades in South Sudan to internalize, implement, and test-drive these systems, and modify them as our experiences using them grow and mature with time.  
The fact that in South Sudan the President can remove an elected governor is not unique as is the case of India where the central government can dissolve the whole state government. Should we disagree, we need to amend such clauses in the next constitution after a thorough debate, while ensuring that a provision is made about the measures that would safeguard our sovereignty from actions of unruly state governments. It is an issue which cannot be left to chance in the constitution.   
The Way Forward
There is much unutilized capacity in our constitution, especially in regards to devolution of powers to lower levels of government and delivering services to our citizens through a devolved power. For instance, local government act 2009 has not been fully implemented and that is why we still have appointed county commissioners as opposed to elected commissioners. County legislative councils have not been set up due to financial constraints. The central government in Juba has been trying its best to be inclusive in the distribution of political power with appropriate regional representation; representation of women, religious minorities, special interest groups as such army and business sector, those with special needs, and other minorities such as Muslims.

As far this author is concerned, the structures and forms of an inclusive society and representative if equitable government systems with generous provisions for federalism are in place. The challenge at the moment is to give it a substance and how to fund these arrangements function as well as how the whole structure orchestra (from federal, to state, to local) can be made to play in constructive unison in order to deliver prosperity to all our citizens; from Raja to Pibor, and from Renk and Abyei to Nimule.

 Our strength lies in discovering our shared patriotism and history, and as African Sudanese and not fretting over our ethnic differences. This is an ideal for which we as the citizens of this great nation should live to realize, or die to defend.

Sunday, January 05, 2014

South Sudan: Making Sense of December the 15th, the Political Causes of the Unrest – Part 2

By John A. Akec

It is a daunting task trying to sum up in one article the myriad of political causes behind three weeks of catastrophic violence in South Sudan in which over a thousand lives have been lost, tens of thousands displaced, incalculable damage inflicted on the national economy, and human rights and security undermined by the parties involved in the conflict

In the part 1 of the series, the author had highlighted how the conflict was started based on firsthand accounts of the military generals in the army division of the Presidential Guards in which the shootout began on the night of December 15th 2013 at around 10:17 pm before spreading to other army divisions and thereafter to state of Unity, Jonglei, and Upper Nile.
This is the second and the last part of the article series.

Not a while ago, I noted that everywhere in the world, lessons of history are learned to build a safe pathway into the future, except in South Sudan where events take place and are soon forgotten. And that, in my view, is a big mistake. And as Professor Abraham Matoc Dhal of Rumbek University's College of Economic Studies recently noted: "History is not for nothing."

Not only history, but in author's view, anthropology matters also in understanding the root causes and parameters of ethnic conflicts.

Writing on Development Policy Forum, a policy discussion forum managed by Ebony Centre for Strategic Studies, a think-tank, Samson Wassara, a professor of political sciences at the University of Juba observed:
"The causes of the crisis are rooted in historical legacies of the long civil war that seemed to have ended by the signature of the Comprehensive Peace Agreement (CPA) in January [...] can be traced back to the event. But causes of the current crisis are associated with the past. "

Thus, in order to find our compass into the present quagmire, a glimpse into our distant and recent past will be an exercise worth doing, albeit imperfectly.  

Dinka is the largest single ethnic group in South Sudan. They exist in 7 out of 10 South Sudan states: Northern Bahr El Ghazal, Western Bahr El Ghazal, Warap, Lakes, Jongeli, Unity, Upper Nile state, in addition to Abyei. They total around 3.2 million strong according to South Sudan Population Census 2008 (excluding Abyei). The Dinka outnumber the Nuer by a factor of 2 to 1; namely, for every Nuer, there are two Dinka. The majority of Dinka are found in Northern Bahr El Ghazal, Warap, and Lakes staes. In Unity State, Dinka are minority occupying just 2 counties out of 9; while they have significant presence in Upper Nile where they occupy 4 counties out 13; and in Jonglei state, the Dinka occupy 4 counties out of 11.
The Nuer, on the other hand, is the second largest ethnic group in South Sudan. They are found in Unity, Upper Nile, and Jonglei states with a total population of about 1.6 million strong. In Unity state, they live in 7 counties out of 9 where they are the overwhelming majority. In Upper Nile state, the Nuer occupy 4 counties out of 13, and in Jonglei state, they have 5 counties out of 11.

Between them, the Dinka and Nuer make up 4.8 million or 57% of South Sudan population.
The two ethnic groups share common culture, have similar languages, and practice agro-pastoralist economy. The Nuer ethnographers include Edward Evans-Prichard (The Nuer: A Description of the Modes of Livelihood and Political Institutions of a Nilotic People, 1940),  and Sharon E. Hutchinson (Nuer Dilemas: Coping with Money, War, and State, 1996), while Dinka were studied by Francis Mading Deng (The Dinka People of the Sudan, 1972), Geoffrey Lienhardt (Divinity and the Experience: The Religion of the Dinka, 1961) , and John Ryle (Warriors of the White Nile: the Dinka, 1982), among others. It is worth referring to these works to gain some background understanding of the Dinka and Nuer norms.

In one of his papers (The Nuer of Southern Sudan, 1940), the British anthropologist Edward Evans-Pritchard, who also described the Nuer as "wild offshoot of Dinka", observed:
"Every Nuer, the product of hard upbringing, deeply democratic and easily aroused to violence, considers himself as good as his neighbour; and families and joint families, whilest coordinating their activities with those of their fellow villagers, regulate their affairs as pleased."

The above accolade-imparting observation has a worrying side to it, though; namely, being "easily aroused to violence" and being "deeply democratic" do not make for good bed-fellows for advancing democratic values when Nuer interact with other groups in the state, for example. Pritchard also noted that while the Nuer do not follow leaders, they can listen to their spiritual/religious leaders such spearmen and rain-makers. Ngundeng is a good example of influential religious leaders.

The same could have been said about the Dinka, except that Dinka, in my view, are relatively slow to provoke to violence, although many of them have aggressive tendencies when interacting with others. This is what many outsiders find intimidating to say the least. And once provoked, are not easy to stop. What is more, Dinka communities maintain communal leadership structures with clear lines of communication; and it is not just anybody in Dinka society is considered a leader.

Moreover, leaders in Dinka society are heeded and the Dinka believe that people, even within the same family, are "not as equal as sticks in a match box," or "have the same height as the herds of giraffes." It means some are considered wiser than others. Some people deserve more respect than others, because of their age, education, or social status, for example. This stratification of Dinka society has positive implications for the way peace is maintained, conflicts resolved, and on how the society is organised and led.

Traditionally, the Dinka and Nuer raided each others' borders for cattle rustling especially during the dry season from December to May each year. More often than not, when Dinka raids Nuerland, it is likely to be retaliation for a Nuer offence. However, in recent years, and with spread of small arms, the raids have become increasingly deadly, and more of Nuer's Dinka neighbours increasingly taking the initiative to rob Nuer's cattle instead of confining themselves to counter Nuer raids. And what is disturbing about all this is that rarely had the disputes been settled or have anyone been brought to justice for cattle rustling offences that frequently involve lost of life including the killing of women, children, and the elderly in cold blood.

The politicians and military personnel from the two groups have often collaborated fruitfully at certain times, and clashed destructively in other times. In Sudan history on anti-colonial movement, for example, both the Dinka and Nuer made significant contributions to resistance movement against the British colonial rule in Sudan. The White Brigade was founded and led by Ali Abdalatif, a Dinka by origin, who was the political leader of the first Sudanese anti-British movement, and Abdalfadheel El Maz, a Nuer by origin, historically noted for bravery and a military heroism, and as martyr of 1924 armed uprising against British rule in Sudan. This is not to say that only Dinka and Nuer were the only active ethnic groups in the anti-colonial movement.
Furthermore, in author's time, collaboration between two former Sudan army officers Kurbino Kuanyin Bol, a Dinka, and William Nyuon Beny, a Nuer; led to staging of a mutiny in 1983 in Bor and Ayod respectively, and marked the beginning of the second wave of North-South conflict led by Sudan People's Liberation Movement (SPLM) that ended with signing of Comprehensive Peace Agreement (CPA) in January 2005, and the declaration of South Sudan independence in July 2011.

And while there has never been a complete divide along ethnic lines, power struggle between leaders from Dinka and Nuer ethnicities has also involved a component of ethnicity when mobilising support base, or as the unintended consequence or a by-product of such power struggle.

For example, power struggle and clashes of visions pitted John Garang (a Dinka), Kuribino Kuanyin (Dinka), and William Nyuon (Nuer) of SPLM on one hand, against Samuel Gai Tut (Nuer), and Akuot Atem (Dinka) of Anya Nya II on the other hand during the early stages of founding of SPLM (1984-1985), and led to one of the first bloody splits within the leadership ranks in South Sudan resistance movement. The dispute over power eventually took ethnic line in which thousands of lives were lost, mostly in suppressing Nuer-led mutiny against SPLA which also resulted in the victimization of innocent Nuer civilians; and through revenge  killings carried out by Nuer militia against Dinka, irrespective of whether or not the Dinka victims are armed combatants or unarmed civilians.

The conflict in SPLA began with killing of Samuel Gai Tut in an ambush by a force loyal to John Garang in 1984 while Tut was on his way to a meeting to settle differences with Garang's group. After the death of Samuel Gai Tut, William Abdalla Chuol, a younger Nuer officer, took over the faction (Anya Nya II) after executing Akuot Atem, a Dinka compatriot of Samuel Gai Tut. This was followed by a massacre that claimed nearly 2,000 Dinka SPLA recruits from Greater Bahr El Ghazal en route to Ethiopia through Upper Nile. Abdalla Chuol was later assassinated by SPLA forces after leading a fierce counter insurgency against SPLA with the support of Khartoum government after his forces became known as government "friendly forces."  In pursuit of Nuer counter insurgents, SPLA committed many atrocities against Nuer civilian population which led to mass migration to North Sudan, and deepening the hatred between the two ethnic groups.

Furthermore, in 1991, Riek Machar broke away from SPLM and formed a faction known as SPLM-Nasir. Starting as a broad-based splinter group, Nasir Faction increasingly became an exclusive Nuer outfit, especially after Bor Masacre in 1991 in which 2,000 Dinka civilians were killed by Machar's forces. In 1997, Machar-led South Sudan Independence Movement (SSIM), as Nasir faction was later renamed, signed Khartoum Peace Agreement (KPA) with Sudan government.

Machar forces, that were predominantly Nuer, mounted serious counter insurgency against SPLA  and allowed the Sudan government to exploit the oil from South Sudan fields in Unity and Upper Nile, with catastrophic outcome for South Sudan liberation war. After the collapse of Khartoum Peace agreement, Riek Machar quit to sign an agreement with SPLM and was reintegrated with some of his forces in 2001.  Paulino Matip and other generals stayed behind in Khartoum until 2005 when CPA was concluded before reaching a new agreement with SPLM.

Professor Wassara noted recently that the agreement was not good enough:
"The cosmetic reconciliation between the SPLM/A leading to the signing of the CPA did not heal the wounds of the 1991 rift."
Yet this question remains: What actually constitutes reconciliation in what is increasingly ethnic-based power struggle?

After the signing of CPA and setting up of the government of South Sudan, anti-government militia activity in Unity, Upper Nile, and Jonglei that lacked clearly defined goals had continued unabated and posed security challenges to the nation. The solution has been amnesty and integration of militia leaders and their armies into the rank of SPLA, only for many of them to re-defect months or year later. The government continued to apply the same cure to militia problem and with the same results!
And despite all above, it would appear no one has internalized the root causes behind the Nuer unrest so as to identify more sustainable resolution.

It would be a grievous mistake to say that the re-integration of Dr. Riek Machar into SPLM in 2001, and giving him the second highest stake in the government after the president had done nothing to keep power dynamics between the two groups in check, leading to a peaceful conduct of referendum and standing up to Sudan's intransigence over the post-referendum issue.

It is worth mention that the Nuer were given great stakes in the government across the board the level of which is commensurate with their size in the population. And as vice president of the republic for 8 years, it is understandable that Dr. Machar of late has began to set his eyes on the top job and to explore the political landscape to identify any obstacle to his political ambitions. And he did find many.

First, Dr. Machar wanted the term of presidency reduced to two terms maximum in the South Sudan interim constitution, but that wish was not granted. Second, he wanted the vice president to be acting president should the position fall vacant until elections take place. Instead, the job goes to leader of national legislative assembly as in the constitution. Although he had wanted to be nominated as the leader of the house, he was not. Next Dr Machar strove to remove the clause in SPLM constitution that gives SPLM chairperson to nominate 5% members to NLC and at all other levels of the party. That was roundly voted down in the last NLC convention (128 against 8). Again Machar want the decisions to be made in NLC using secret ballot rather than the show of hand (hoping to give the shy members to make their genuine choice without fear of intimidation). That was also defeated by a majority vote. Machar expected for a more reconciliatory speech from the SPLM chairman at NLC convention, but he got none.
Small wonder, Machar and his group walked out of NLC convention Saturday afternoon, and never to return. And the rest is history.

"Machar should have known better that using ethnic means as a strategy to get power will have many unintendend consequences", said a former SPLA combatant. 

The most obvious thing that Dr. Machar could have done was to form his own party and contest the next election. Having come close to the front of the queue, the rules of the game were suddenly changed and Machar found himself thrown to the bottom of stairs; and then the stairs taken away. Instead of ballot, Machar went for bullet, with the intent to right those wrongs. Not a good choice.

At the moment, 55 to 60% of the army is Nuer, while they are 20% of population. And given the high defection rate among Nuer in recent conflict, the trust in members of Nuer in the armed forces has received a terrible bashing. One former SPLA general was quoted as saying: " the dilemma for South Sudan is either the constitution disallows the drafting of Nuer in the army, or give them their own country." This would sound extreme but minimizing risk of defection of Nuer in future would be a critical concern in the maintenance of national security.

It would require the passing of legislation to reorganize the army on the bases of the states representation and population size, including increasing the representation of Equatorians and other ethnic groups.
It is unlikely that Machar will win the war and compromise from warring parties would be necessary. International community can work to get the parties agree on transitional period to an internationally organised elections. Machar and group need a free space to promote their vision through peaceful democratic means.

The government also needs to reform the army to be more professional, representative of the whole population, and trustworthy. Compulsory military service should also be constituted for all below certain age to be agreed.

Security organs need strengthening and improve its technological capacity to detect crime and fight terrorism at the bud. Security holes created by non-registration of all mobile phone numbers needs to be addressed as a matter of national security.

And above all, the government needs to improve service delivery in areas of health, education, transportation, electricity, drinking water, and food security to the whole population. Those are the things that worth fighting for, and not on who should be the ruler.

Monday, December 30, 2013

South Sudan: Making Sense of December the 15th, Start of War – Part 1

By John A. Akec

It is slow and difficult to build anything worthwhile, but it takes just a few reckless hands to bring to naught what has taken years, many hands, and resources to construct. Thus, goes the perceived wisdom. And of all humanity's endeavours everywhere, nothing surpasses the continuous struggle to achieve peace and to maintain it.

And if bad peace is better than just war, an unjustified war is a double tragedy that can afflict any nation.  And tragedy is what befell our nation on December 15th 2013 when the hell broke loose and hundreds of lives were lost in fighting involving the national army and soldiers loyal to former vice president Riek Machar.
Scenes of devastation were evident everywhere in Juba and Bor. A journalist who accompanied the army that recaptured Bor from Machar's forces wrote:

"The chaos caused by the rebels is everywhere to see. Shops are looted, houses smashed down, while in the office of the governor -- used by the rebels as a base during their occupation -- windows have been bashed in and doors ripped off their hinges."

In addition to media reports, the author held interviews with lay citizens, SPLM party officials, politicians, academics, civil society leaders, and army and police officers, some of whom were directly involved in combat operation.  The outcome is a two-part article in which the author strives to provide an analytic perspective of the conflict. This is part 1 and part 2 will follow immediately soon.

Media reports were quick to christen it as a fight between Dinka and Nuer ethnic groups in the army, and that Dinka elements in the Presidential Guard got involved in lynching of Nuer civilians in Juba. There were expressed concerns that the endorsement of these media reports by Dinka politicians close to Riek Machar, and most notably the statement by Rebecca Nynadeng de Mabior to BBC, might have contributed to inciting more revenge killings against Dinka civilians and army colleagues by Nuer soldiers in areas under their control.

Fighting spread to Jonglei, Unity, and Upper Nile states; and thousands of civilians took refuge in churches and UN compounds in Juba, Bor, Akobo, Bentiu, and Malakal. Hundreds of civilians died of cross fire or by ethnic-based targeted killings in Juba, Bor, Akobo, Bentiu, Rubkona, and Thar Jath.

Embassies rushed to evacuate their staff and their nationals from South Sudan, as did international NGOs. Foreign nationals and their businesses struggled to scurry out of South Sudan in the shortest time and through quickest route possible, mostly by air; and Juba International Airport was chocked to the brim.

An angry young Nuer civil servant with whom the author had a discussion at Juba International airport said a week after the incident:
"The situation has now subsided, but I am leaving the country to Nairobi because I am afraid, very afraid. The bottom line is: there will never be a Nuer country without Dinka, and there will never be a Dinka country without Nuer. But there will always be one South Sudan. What happened recently shows that there is something fundamentally wrong with the current system of government."

And judging from media reports in regards to targeted killings that claimed many lives of Nuer civilians which included members of parliament, civil servants, pastors, and teachers in Juba, this author have nothing but great regret and sympathy for those who have lost their loved ones in these senseless killings, and a concern as a citizens about the breakdown of rule of law in our country.

Both civilians and members of organised forces I have spoken to did admit that "some very bad atrocities" were committed in block 107 and Gudele areas of Juba against members of Nuer community, especially at Lou Police station where unconfirmed reports say many ehnic Nuer were dragged, and never to be seen again. The police authorities concurred that the whole "situation went out of control" especially on Tuesday afternoon and throughout night of 17 December.

A civil society activist from Nuer community in Juba sent me an email saying he was on the run after receiving death threats through text messages from unknown people which the activist believed are security personnel angered by his organisation's human rights activities.

I asked the authorities how come such a thing could be allowed to happen, and a senior police officer replied:"What we have is not a civilized, well-trained, and professional army that is guided by values and principles of the military profession. Even chiefs who cannot read or write have been integrated into the army and given the rank they have requested. This has demoralized the whole army. We are still waiting for reports from Central Equatoria Police authorities in regards to the reported killings of ethnic Nuer"

An academic who survived revenge killing against Dinka co-passengers at Thar Jath airstrip on Thursday 19th December spoke to the author by phone from UN Compound in Rubkona:

"We traveled to Thar Jath air strip this morning and were in the process of checking in when armed men in non-uniform suddenly appeared and asked everyone to go inside the airport lounge. Later, all the cars and buses were instructed to drive in convoy to Dan Duk, fifty miles from Bentiu were all passengers were lined up. Each passenger was asked to step forward and was asked about their place of origin and supportive id. Many were allowed to get back on the bus and ordered to return to Bentiu."

Later on, the academic learned that two co-passengers were identified as Dinka and were killed, in addition to not less than four other Dinka who were in a land cruiser vehicle a head of the convoy and a Kuku serving with National Security Service were shot dead by the armed men believed to be Nuer. "One of the attackers was a 14-year old boy who frantically held out a gun at passengers and was in tears and appeared very upset and was asking to be allowed to shoot all the passengers but was constrained by armed men in his company who took the gun away from him", said the academic. The academic also said the attackers also took mobile phones, cameras, and other valuables from the passengers.

Eventually, the academic and another colleague of his were evacuated by WPF plane to Juba, three days after the incident.

The retaliatory atrocities committed by Nuer elements against Dinka in the Nuerland has also undermined their commitment to respect of human rights in the eyes of many lay Dinka who had nothing to do with said atrocities against Nuer:
"In contrast to what happened to Dinka in Bentiu, Bor, Akobo, and Malakal, no single Nuer has been killed in the whole of Greater Bhar El Ghazal; and yet, the international community and media has not been fair on Dinka.", said one citizen from Warap State.

Yet, it would also be unfair to conclude that all Nuers have shown mo mercy and there are many stories heard by the author about saving lives of Dinka members in Nuerland by Nuer friends or work colleagues. A pastor and member of National Legislative assembly from Akobo county in Jonglei state told the author:"I lost two members of my previous Church in Akobo when they tried to protect Dinka friends. They were killed by their Nuer clansmen because they wanted to protect two Dinka soldiers who are members of my church."

What Actually Sparked the Fight on Sunday 15th December 2013?
According to some analysts, the shootout that started at the headquarters of Presidential Guards Division of South Sudan army was caused by "rumour and paranoia." Another version provided by sources close to Riek Machar say the conflict was sparked by "an attempt to disarm members of Presidential Guards that belong to the Nuer ethnic group by a force composed of Dinka elements of Presidential Guards."And still others say it was sparked by "a fight between two drunken soldiers in the Tiger and Buffalo brigades", and evolved into a confrontation between Dinka and Nuer elements in the army.

Furthermore, government officials described it as an "unsuccessful coup attempt by Dr. Riek Machar in collaboration with a number of former cabinet ministers." This was flatly denied by Riek Machar, although he later on admitted being the leader of the mutiny. What is more, a few days later, and precisely on Friday 20th December 2013, Dr. Riek told Al Jazeera interviewer that he wants to be the next SPLM flag bearer in 2015 election, and the next president of South Sudan.

As always, the first casualty of war is truth itself. Major General Marial Chanuong Yol, the Commander of Presidential Guards in South Sudan, told the author:
"I felt something was wrong when Dr. Riek Machar wanted to force his way into the convention hall where the meetings of National Liberation Council (NLC) were scheduled on Saturday December 14 with all his 30 guards who arrived with him in 4 cars. Only one guard was eventually allowed to accompany Dr. Riek into the conference hall and the issue was peacefully resolved after one of his officers almost caused a fight at the gate just before the opening ceremony of the SPLM NLC convention."

Maj. Gen. Marial Chanuong said he was at the division headquarters up to 6 pm on Sunday after which he went home. At 8 pm, he received a report that there had been a dispute at first battalion where a certain Nuer major  expressed anger because the number of guards at ammunition store was higher than normal. Chanuong sent a Nuer colonel to resolve the issue. He then requested the colonel on duty to be alert. He also noted that colonels John Malual Biel and Peter Lok, both Nuers, who are first and second battalion commanders had arrived back at the army garrison that evening.  "The two were believed to have been in contact with their politicians", according to Chanuong. Also eye witnesses said money was distributed to Nuer soldiers on Sunday and many of them came back to garrison and took up their arms early in the evening that day.

At around 10:17 pm exactly, Colonel John Malual Biel, head of first Battalion shot his deputy, Akol Reec (a Dinka from Warap State) unprovoked. He died a day later from his bullet wounds. At the same time, Abraham Manyuat Ajou was shot by a certain Nuer Brigadier General James Koch Gak (there is slight variation as to who was shot first). Hence at the start of the incidence, the shooters were all Nuer, and the victims were all Dinka. The killing of the two Dinka officers was in cold blood, and was never preceded by arguments or "wrist fight" as some media has reported it.

Fighting then erupted. An unknown number of soldiers were killed on the side of government forces and mutineers. And contrary to reports that the mutineers had control of army headquarters on Sunday night, Maj. Gen. Chanuong said the battle raged throughout the night and that the mutineers could not succeed to capture the ammunition store and were pushed out of the garrison by 2am of morning of 16 December 2013 into Jebel area of Juba, according to Chanuong.
"Nuer soldiers in non-uniform mobilized Nuer civilians in 107 area and they tried unsuccessfully to take over the ammunition store at New Site", Chanuong relates.

Chanuong also dismissed the reports that it was a fight between the Dinka and Nuers per se:
"More than 50 percent of our forces are Nuer. My deputy is a Nuer. My office manager is a Nuer. Three of Ltd colonels under my command on Sunday night operation were Nuer. Why didn't they kill me if it was an issue between Dinka and Nuers? Many of those who defected did so from the wrong information they got in the media."

Asked about the report of atrocities against Nuer civilians in New Site and block 107 area of Juba, he replied:
"I can only speak about the forces I command. We are not responsible for the atrocities reported." He said some of individuals many of whom are not part of the army have been arrested in relation to the atrocities and that investigation is ongoing to identify those involved in the killing of civilians.

Maj. General Marial Chanuong acknowledged that there were indicators that this was coming but did not have evident to make the arrest:
"Had we done that [arrested perpetrators], we would have been accused of sparking the fight. That they have ventured to execute their plans makes them fully accountable for their deeds."

After more than one hour of conversation with the author at his office at Division headquarters where troubles started, Maj. Gen. Chanuong introduced his second in command, Brigadier Simon Yien, a Nuer, as well as other Nuer, Dinka, and other South Sudan ethnicities in the Presidential Guards. 
He said:
"Please tell them when you write your report that you found Nuer and Dinka eating together."
This was in stark contrast to claims by some sources that the coup was led by Brigadier Simon Yien, a proof of how much disinformation was being generated in Juba!

Of 11 politicians that have been arrested by the authorities, mostly from Dinka ethnic group, two have been released as at the time of this writing. The government has also agreed to a cease-fire and called for 
unconditional dialogue with Machar's group.

In summary, it would appear that what took place on the night of December 15th was less of a Dinka-Nuer conflict, and more of a pre-planned politically motivated mutiny using ethnic card to mobilize a support base. The mutineers were all Nuer, while those fighting against them were a multi-ethnic army. The severity of the conflict has also been aggravated by inaccurate media reporting and the inflammatory statements by some politicians. It has also created an environment of mutual mistrust amongst the citizens as to who is against or for the government; or who is your friend and who is your enemy. In words of Bishop Daniel Deng of Episcopal Church of South Sudan, "we do not know is fighting whom."

December 15th incidence, therefore, presents the nation with open questions as to what were the underlying causes of the conflict, how it might be resolved, how its repeat may be prevented in future, and what are its implications for nation-building, organisation of armed forces, and the future political stability of the country.

The second part of article series is going to examine the political causes of the unrest and the implications for the political future of the country.

Saturday, November 23, 2013

South Sudan: Why new economic policy or Tisaconomics is more destabilizing to the country than past austerity measures or Kosterity?

By John A. Akec
There is no question, the sacking by President Salva Kiir Mayardit of his cabinet last July 2013, and swearing in of new government, was received in the streets of Juba and across the cities of the nation with great jubilation and optimism. The move has raised hopes that the President has finally resolved to lead from the front as opposed to leading from the rear, a style the President has adopted since coming to power in 2005.

Unlike his predecessor, Dr. John Garang De Mabior, President Salva Kiir Mayardit is known for his delegatory and consensual approach to leadership. He allows plenty of space for national ministers to craft and implement their own policies with little or no intervention. Dr. John Garang, in contrast, led from the front and was a micro-manager who left nothing to chance. While many may miss Garang's leadership style, a significant opinion amongst the citizens admire Kiir's delegatory approach as more democratic; given the potential of empowering his officials to be autonomous, creative, and innovative.  Still some view this as weakness and lack of confidence to give clear directive to ministers and to follow through with implementation; although these are in minority. The majority of citizens I have spoken to insist that it is a sign of self-confidence and secure leadership. All the same, the jury is still out.

That said, leading from the hind might have caused President Kiir's government more pains than gains. It has rarely worked as might have been expected. Take as an example how his cabinet voted unanimously to shut down oil production in January 2012, following the dispute with Sudan over the amount of fees to be paid for export of South Sudan oil. The decision stunned the citizens, friends, and even foes in equal measure. Few could comprehend how a nation that depends on oil revenue to fund 98% of its programmes could allow such a decision to pass.

Some rumors had it that the President was opposed to shutdown, but relented to the decision of majority in the cabinet. The President could have simply overruled the cabinet with his veto powers. For example, the US President Abraham Lincoln was once said to have overrule his cabinet saying: "I count one yes and six no. The yes wins!"

After that decision, austerity measures had to be imposed on all government spending. These measures came to be known as Kosterity measures after Kosti Manibu, the then Minister of Finance and Economic Planning.

As if it was not bad enough, after shutdown of oil production, months of negotiations passed without any hope of agreement being reached with Sudan over oil transit fees. Thanks to President Kiir's delegatory leadership that allowed the now suspended SPLM Secretary General, Pagan Amum, to drag the negotiations on indefinitely with no sign of comprise, while the austerity measures continued to bite the nation harder and harder, and the relationship with the neighbouring Sudan continued to go from bad to worst.  

It was that kind of indecision that prompted Secretary of State, Hillary Clinton, to pressurize Juba saying: "Percentage of something is better than percentage of nothing."

However, it was after President Kiir Mayardit personal intervention that things began to look up again. Following Kiir-Bashir summit, a cooperation agreement with Sudan was struck in Addis Ababa in September 2012, and as a consequence, production of oil from South Sudan oil fields resumed in April 2013.

What's more, President Kiir moved quickly and (rightly so) to repair relations with Sudan so that trading and flights could resume between the two countries by reaching an understanding with President Bashir on measures that would reduce tensions, such as relating to the trading of accusations of support of armed dissidents from each country. It was completely results-based leadership: effective and self-evident. It was also a testimony to the fact that when leaders ignore the pleas for consensus in critical matters, and follow their guts, success can easily come their way.

But sadly, President Kiir's pains are far from over. No sooner has the President passed over one crisis – that of austerity, and oil shutdown; has another crisis begun to peer out its ugly head. This is the new crisis in the making, caused by none other than economic policies currently being unveiled by the Ministry of Finance, under the leadership of Mr. Aggrey Tisa Sabuni. This, we will call Tisaconomics.
According to the policy adopted by Mr. Sabuni, austerity measures will continue until January 2014 when new and more generous supplementary budget will be submitted. In October 2013, the Parliament passed an austerity budget of SSP 19.0 billion with the plan of borrowing SSP 4.5 billion or USD 1.6 billion to bridge a gap in that budget. Interestingly enough, this budget was three times higher than that under Kosterity measures in July 2012, and the highest since the nation gained its independence in July 2011.

However, in the past week or so, the Bank of South Sudan issued an order to raise the exchange rate of dollar against South Sudan pound from SSP 2.93 (bank rate) to SSP 4.5 (the black or so called parallel market rate). The markets were shocked and the rate of exchange of SSP in the black market jumped from SSP 4.5 to between SSP 5.00 and SSP 6.00. Fuel disappeared from petrol stations, and supermarkets and warehouses for building materials closed their doors in panic, as traders tried to figure out how to respond. This is because in South Sudan, majority of traders access dollar through black markets as opposed to Central Bank.

Following that, the Parliament summoned the head of BoSS, Mr. Kornelio Koryom, the next day, and ordered him to reverse the decision with immediate effect. And he did. The rate of exchange of dollar went back to SSP 4.6 immediately which was slightly higher but close to its pre-decision rate.
The explanation provided by the Finance Ministry and the Central Bank was that the government would like to raise an additional SSP 4.5 billion needed to finance the hole in the approved budget in order to meet the budget shortage by devaluing South Sudan pound by 38%, as opposed to borrowing externally, as was initially proposed.

That decision was greeted with dismay nationwide, and Isaac Cuir Riak, Professor of Economics at University of Bahr El Ghazal, reacted by describing it as "misplaced" because, according to his analysis, the devaluation could lead to inflation in prices of imported consumer goods, and could push more people below poverty line. Many other commentators and economists also condemned the decision describing it as abrupt and not well scrutinized.

And as weeks and months passed since the Parliament approved the new budget, the country is going for two months without paying the salaries of civil servants, academics, doctors, nurses, and teachers. Ministries and government agencies have not received any of their allocation for services and operation to up to the time of this writing, thus risking bringing the country to near standstill. The question that imposes itself is: Is it not truly ironic that the financial situation in the country is deteriorating by the day at the time when oil money is following into government's coffers?

Thus, one is bound to conclude that if Kosterity had weakened the government of South Sudan ability to provide services the citizens need, Tisaconomics which appears to lack direction and is incapable of taking prompt decisions is threatening the country with social and political upheavals that could lead to igniting an African Spring in form of mass action across the country.

The eyes are again focused on President Kiir Mayardit to intervene and diffuse the situation by directing the Finance Ministry to take immediate remedial action. These times are critical times, and the President is more than able to rise to these challenges at this juncture in the life of the nation.

Tuesday, January 29, 2013

A Call for a Marshall Plan for South Sudan (Part 2 of 2)

By John A. Akec
"A pound improvement in governance leads to a tenfold increase in prosperity" – Author's personal conviction

This is the second and final part of the article which I published recently under the same title. The central theme of the first part of the article was proposing a South Sudan Marshall Plan to be funded by US, Britain, and Norway in partnership with countries that have interest in strengthening peace and political stability in South Sudan through extending line of credit on favourable terms to the government of South Sudan and, where appropriate, providing financial assistance in areas of strategic importance to the new nation.
After publishing part one of the article, numerous comments were made on different discussion fora that ranged from encouraging, to lukewarm, to pessimistic. Prominent among these comments is the perceived institutional fragility of South Sudan, high level of official corruption, and increasing crime and insecurity in the country; all of which many of my discussants believe will put off potential lenders, investors, and donors.

While acknowledging that these are genuine concerns, I am of the view that equitable socioeconomic development is an indispensable vehicle for achieving peace and political stability in any country - a satisfied citizen is a happy and peaceful citizen. I also acknowledge that institutional reforms and improvements in governance are vital if such a plan is to succeed. We will need to convince the lenders to part with their money by giving them confidence that the funds will be effectively used to achieve the intended goals.

Moreover, once funds start flowing in, success must be maintained in order to guarantee further funding.
This article outlines a number of institutional reforms and a sample of project priorities from a personal perspective without confessing to 'knowing it all', and without being presumptuous as to think that my noises as a blogger will ever ruffle the feathers of the establishment. And notwithstanding, I want to share my thoughts on the above issues as a global citizen and local member of this society called South Sudan. To that end I want to 'do it anyway' as Mother Teresa would advise us.

This is a challenge for which there is no quick fix, apart from continuous monitoring, evaluation, and change so that current institutions are seen fit for the purpose. For starters, there must be legislation in place to define the purpose and mandate of institutions in unambiguous terms. The legislation must define accountability hierarchy and lines of command. Right persons with right skills and experience must be chosen to lead the right institutions. There must be a yardstick for measuring institutional effectiveness and mechanism for monitoring performance. In other words, to operate the government in closed-loop mode as opposed to open-loop fashion in which we seem to fire into the dark without bothering to count the number of hits or misses.

National Legislative Assembly needs to be more effective in both its legislative and supervisory role than it currently is. There is concern that our law makers are too reluctant to raise motions on anything that will challenge or bring a member of executive wing (president, minister, governor, or commission chairs) under spotlight. This needs to change even if it means the President calling an earlier election or do something to wake everyone up in the legislative wing.

Presidential Advisors
 Good advisors are the eyes and the ears of a president. There should be presidential advisors on all things that matter to a nation. Advisors do not necessarily need to be on full-time terms of duty. The current range of presidential advisors is limited and needs expanding. Areas for advisors' appointments, beside political affairs, decentralization,  religion, and gender; should also include foreign affairs, education, health, science and technology, agriculture, trade and industry, environment, media, aviation, transport, and so on. In terms of priority, advisors on economy, education, health, agriculture, and science and technology should come prominently high on the top list in addition to security and defense (already well catered for).

Establishing Institutions for Strategic Planning
Every country must have strategic goals that define where the nation wants to be in the next 3, 5, 10, 15, 20 years and beyond. What we do at present will bear fruits in the distant future. What we do not do at present can be a missed opportunity tomorrow. Hence, South Sudan can do better with a little more strategic thinking and less with groping in the dark.

For example, where South Sudan finds itself today in terms of shortage and high fuel prices is hardly an accidental misfortune, but rather the ultimate prize for not thinking and acting strategically five or seven years ago. It is a living proof of the cliché: failing to plan [strategically] is planning to fail [strategically].

Institutions for strategic planning are vital for the survival and future prosperity of any country. All forward-looking nations must have institutions that specialize in scanning the horizons for risks, threats, and opportunities; then prod the governments to plan and act well ahead of time upon the findings in order to minimize risks, reduce threats, and exploit opportunities. The government of South Sudan must set up a council for strategic planning that consults and works with academic and research institutions, think-tanks, and civil society groups to conduct policy analysis and compile reports that inform government strategic policy design and long-term development plans.

That also means the government should avail funds for think-tanks, research and academic institutions, and civil society groups to build up their capacity to play their role in socioeconomic development. And more important still, the government must act upon their analysis and findings.

The designated institution(s) for strategic planning should monitor how developmental projects are faring and frequently publishes reports (internal and public), meets with the legislators and executive branch of the government to discuss the status of progress of major projects and performance of the economy; thus enabling the executive branch to take informed actions and corrective measures in good time. The institution(s) of strategic planning need to have specialized committees or department within it dealing with specific issues and ministries. Its membership should include heads of specialized committees in the legislative assembly, among others.

 South Sudan Economic Council
A multi-disciplinary body with secretariat hosted in the Presidency and works closely with the Council for Strategic Planning and the Ministry of Finance and Economic Planning, Academia and Civil Society to make informed decisions that affect the economy in the short and medium term.

Financial Allocation, Monitoring and Evaluation Authority
This works closely with Council for Strategic Planning, South Sudan Economic Council, the Ministry of Finance and Economic Planning, specialized committees in the national legislative assembly, anti-corruption commission, office of auditor general, statistics commission etc. It should report and publish allocations and use of funds at least once or twice a year.

Education Sector Reforms
For start, every state should have a university, a technical and community college, a multi-skill vocational training centre, girls' academy, and agriculture extension training institute. Higher education and general education must be brought under one roof to stop them growing apart. An independent Curriculum Development, Skills Audit, Qualification and Accreditation Authority should be established in addition to the existing Higher Education Council as policy-making body and Education Commission as education research wing. Within the Ministry of Education there should be departments for higher education, general education, early education, community and adult education, vocational education, philanthropic and private education. Government needs to improve salaries to be high enough to attract foreign academics and teachers and agree policy for employing foreign academics and teachers while retaining nationals.

Improving Transparency, Accountability, and Sustainability in Infrastructural Projects
Government should publish white papers and consult with academia, civil society, and affected communities before giving a go ahead to major infrastructural projects. Environmental impact assessment should also be part of project proposal prior to its approval, funding, and execution.

 Empowerment of Women 
The government should eliminate all barriers that hinder women development and effective participation in the governance. Girl's education should be made compulsory or free or subsidized where there are fees. Legal age of marriage should be raised and girl should at least complete secondary education before being legally married. Forced marriages and traditions that oppress women must be combated through law such as girls' circumcision and other culturally damaging practices that harm young women wherever they might be found.
While encouraging competition amongst women in employment, affirmative action should apply at all time at all institutions and levels in both public and private sector. Workplace design should be such that it is made safe and free from fear of harassment for women. Incentives must be provided to encourage women to break into male-dominated industries wherever they exist. And in everything we do, we must consider how it can be made to impact on women most positively.

Labour Laws and Regulation of Employment of Foreign Workers
Apart from employing academics, teachers, doctors and nurses, petroleum engineers, pharmacists, dentists, lab technicians, and rare technical specialisations, any other employment of foreigners should be regarded as loss to the nation that must be recouped by training nationals to take up the jobs held by foreign nationals. Too much dependence on foreign consultants in sensitive positions must also be reviewed and minimized. Foreign businesses investing in South Sudan must be encouraged by special regulation to employ nationals or make plans to replace foreign employees with nationals according to a time plan.

Control of Development and Humanitarian Assistance
Development aid needs to be regulated and controlled by the government through the relevant line ministries. There are at least three reasons for regulating development assistance and humanitarian assistance: to ensure relevance, efficiency, and equity.

Currently, no one can be certain that all the development aid being channelled into South Sudan is what South Sudan needs, that it is delivering acceptable results quantitatively and qualitatively, and that all parts of the South Sudan are receiving their fair share of development assistance. Left unchecked, unregulated development assistance and aid can exacerbate social and economic inequalities amongst social groups and could reinforce pre-conflict causes of war as development partners randomly pick and chose whom to assist or where to pitch their tents while other regions or social groups are left completely dry.

Involvement of South Sudan Diaspora
South Sudan Diaspora with exposure should be allowed to assist in advice and consultancy in all aspects of planning, procurement, and projects execution. This will be better than relying on 'foreign experts' to design solutions for environments of which they scarcely have any knowledge.

South Sudan needs to make development priorities.  Top on the list are the following:

Provision of Health Services
South Sudan should have at least one well equipped and well staff teaching hospital in every state capital in the next 5 years to 10 years. There must be at least one children hospital in each state. Each state hospital must have advanced medical diagnosis equipment such as computerized tomography (CT) and magnetic resonance investigation (MRI) scans, among others. Moreover, South Sudan must establish hospitals specializing in treatment of heart-diseases and diagnosis and treatment of cancers. There must be plans to increase the number of doctors and nurses per 1000 of population to the levels approved by World Health Organisation (WHO) within a reasonable time scale. The government can also enact regulation allowing private sector to contribute to provision of health services.

Railway Connection to East African Coast 
South Sudan needs to conduct serious feasibility studies that would lead to securing funding for construction of a railway line to east African Coast via Kenya or Djibouti. If Nile has been the backbone of Sudan and Egyptian economies, railway from South Sudan to East African coast (not the pipeline) is the lifeline and backbone of South Sudan economy. Apart from environmental benefits, railway line will create jobs for South Sudanese; reduce the cost of imports and exports, integrate South Sudan into East African Community, and can be used to transport oil. Long after oil has been exhausted, the railway will continue to serve South Sudan economy to generations eternal.

Development of Agriculture
South Sudan must come up with a well reasoned strategy to develop its huge agriculture potential. The first phase is to achieve self-sufficiency and later for export to international markets in form of value-added products. To do this, it is not going to be enough to tell small-holder farmers to "work harder" nor rushing to give them farm machinery and improved seeds and then hope for the best! It needs to be complete package that supports the entire agriculture value chain that ranges from provision of lands to soil studies, to giving improved seeds and application of safe fertilisers, to use of biotechnologies for improved yield, to provision of scientific advice and extension services, to transportation, and access to markets and export facilities. Think-tanks and research institutions can help the government develop a good agriculture development strategy.

Electrification and Water Supply Projects
Availability of cheap and affordable electricity can be a great boost to economy. And without availability of abundant cheap electricity supply, no nation can realistically pursue industrialization. Thus, South Sudan needs to come up with strategies and plans for electrification of cities and country-side using a mix of hydroelectric, fossil fuel, and green energy sources such as biomass, solar, and wind. The plan should aim to provide electricity to at least 80 percent of population in the next 10 to 15 years. Furthermore, along with electrification programmes is provision of safe drinking water for the 10 million South Sudanese population. Electrification and provision of drinking water are candidates for foreign direct investment (FDI) as well as public private partnerships (PPP).

Development of Telecommunications Industry
Availability of telecommunication services and cheap but fasts internet connectivity can reduce the cost of doing business in a country and attract foreign direct investment (FDI).

South Sudan can do well by developing its ICT and telecommunication infrastructure by connecting to East Africa optical submarine cable. The country also needs to set up its own national telecommunication company.

Quality of housing is a significant factor in quality of life and life expectancy. The government should work out a strategy for provision of affordable housing to the population. Again, housing is a candidate for foreign direct investment (FDI) and public private partnership (PPP). Because of poor provision of housing in the capital city Juba, huge sums from public coffers have been spent on the hotel accommodation of government officials in Juba in the last 7 years.

Support to Small Firms and Medium-Sized Enterprises (SMEs)
"Small businesses are the very embodiment of a free society - the mechanism by which the individuals can turn his leadership and talents to the benefit of both himself and the nation. The freer the society, the more small businesses there will be. And the more small business there are, the freer and more enterprising that society is bound to be" – this was Margaret Thatcher, for Prime Minister of Great Britain speaking on importance of small businesses.

SMEs tend to be privately owned businesses that employ between 0 and 250 people. They are normally independently managed by the owner (or the entrepreneur), unlike large publicly quoted companies with more than 250 employees, and run by management boards on behalf of the owners (the shareholders). In European Union alone, small firms account for nearly 98% of 25 million registered businesses, employ 66% of the total work force, generating 60% of turnover (income), and contributing about 90% of all exports income from the Euro Zone. Frequently, small firms struggle with cash flow problems at the start. This is because of their high-risk nature that does not encourage the banks to lend money to them before their profitability is proven.

Recognising the role that SMEs play in an economy in terms of jobs creation, contribution to corporation tax, and the export income generation (which can lead to improvement in the balance of payment), South Sudan needs to devise means and ways to support SME's specially at startup-phase where entrepreneurs struggle with cash-flows and lack of banks' credit. It also needs to establish institutions offering micro-credit.

This article is far from comprehensive and much remains to be said about the proposed Marshal Plan for South Sudan including empowerment of young people and provision of more services for pre-school age children. Thus tremendous gaps remain to be filled through discussion and further research and analysis. A South Sudan Development Conference may be a first step to kick-start the debate. What the article does, however, is to wet our appetite and  expose the kind of thinking we should be engaged in; while embarking on the next phase of our socioeconomic development.

It is also worth pointing out that South Sudan is not applying for foreign aid as many are led to think, but we will be asking for loans and financial assistance to solve specific development problems that are identified by South Sudan, as opposed to donor-identified problems and donor-prescribed solutions that hardly satisfy our development needs. A thousand steps begin with that first step. So let us stop arguing, get away from sloganeering, roll up our sleeves, and get stuck in. We want to figure out our path to development, peace, and prosperity and need not be told by the International NGOs (INGOS) or friendly governments what we should have or should not have.

Our development challenges are clear, and the path to peace and prosperity is plain; why not walk in it? The opportunities have never been so great, why not grab them?

Starting with ourselves let's see who among our friends would want to be counted count in, and who would prefer to be counted out?

Useful Reading for those interested on impact of aid on development of receiving countries
Mary B. Anderson, Dyana Brown, and Isabela Jean (2012). Time to Listen: Hearing People on the Receiving End of International Aid, Publication of CDA Collaborative Learning Project, Cambridge, MA, USA.