Politics and policy
By BRIAN WASUNA, bwasuna@ke.nationmedia.com
In Summary
- Active Partners Group wants Kenyan courts to enforce a Sh3.8 billion claim against the government of South Sudan.
- The firm was awarded the amount by an arbitration panel in January as settlement for a failed mega power project contract with the Juba government.
- Active Partners is targeting South Sudan’s assets in Nairobi after it failed to enforce the arbitration settlement in Juba, whose courts it says are hostile and partisan.
A Khartoum-based multinational company has turned to
Kenyan courts for enforcement of a Sh3.8 billion claim against the
Government of South Sudan, setting the stage for a possible diplomatic
row between Nairobi and Juba.
Active Partners Group was awarded the colossal amount of
money by an arbitration panel in January as settlement for a failed mega
power project contract with the Juba government.
The company, through its Kenyan subsidiary, had won
a tender for the electrification of South Sudan in 2008 but the deal
fell through after Africa’s youngest nation was hit by ethnic war and
severe drought.
Active Partners is targeting South Sudan’s assets
in Nairobi after it failed to enforce the arbitration settlement in
Juba, whose courts it says are hostile and partisan.
Arbitrators Philippe Pinsole, Karel Daele and
Richard Omwela in January found South Sudan responsible for the failed
contract and ordered Juba pay Active Partners $40.9 million (Sh3.8
billion).
South Sudan is yet to respond to the suit filed at
Milimani Law Courts but it is feared that enforcement of the claim by a
Nairobi court could extend ongoing Juba-Khartoum tensions to Kenya.
“If the situation of the debt is not arrested fast
enough there is every likelihood that some of Active Partners’ creditors
may file for winding it up, a situation that might bring to naught all
the effort, energy and expenses that I have put in pursuing the claim,”
says Mohammed Fagir, the firm’s managing director.
A possible casualty of the suit is Kenya’s
diplomatic ties not only with South Sudan but also with the Khartoum
government. Kenya has maintained cordial diplomatic relations with both
nations despite their differences with each other.
South Sudan awarded Active Partners the $197
million (Sh18.7 billion) project from which the contractor says it
expected to make a 35 per cent profit or $69.7 million (Sh6.4 billion).
Active Partners reckons that South Sudan’s failure
to provide a bank guarantee is the cause of its frustrations. The firm
told arbitrators that South Sudan had sufficient funds to issue a
guarantee but opted to use the money for other purposes.
South Sudan had in its defence said its financial
fortunes were changed by the 2008 ‘dura saga’ in which it lost $4
billion (Sh378 billion) through irregular contracts with 441 companies
contracted to supply relief food.
Dura is the South Sudanese name for sorghum, one of the grains involved in the scandal.
Juba also argued that the ongoing war in key
northern and eastern towns like Bentiu and Jongelei forced it to close
oil wells in Heglig, a decision that ripped its financial reserves
apart.
Active Partners says it spent $12.1 million (Sh1.1
billion) in project survey, design, salaries, air charters and assorted
equipment and urgently needs to be paid the money.
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