Even before the ink has dried on South Sudan’s new transitional
government of unity deal, there are ...
allegations that Juba may have been spending oil revenue in advance against the advice and warnings of lenders such as the International Monetary Fund.
allegations that Juba may have been spending oil revenue in advance against the advice and warnings of lenders such as the International Monetary Fund.
Lenders say such a move could worsen the country’s debt situation.
South Sudan could now be forced to open up its books on oil revenue following that little had changed.
Emilio
Manfredi, the co-ordinator of the UN Panel of Experts on South Sudan,
in a February briefing to the UN, claimed that there was no transparency
in use of money from petroleum sales or the financial probity in
planning for it, making officials largely unaccountable.
The panel had tabled an interim report on the country’s sanctions status.
“The
Ministry of Petroleum has not ended the practice of pre-sale financing
arrangements for South Sudanese oil, despite the recommendations of the
IMF,” the report drafted in November, but made public this week, shows.
“The Panel was unable to verify the financial
liabilities of the government related to oil advances, cargoes and
repayment terms because the government has not released current data on
oil sales or published its marketing report, in accordance with the
stipulations in the [Peace] Agreement on transparency and
accountability.”
Promoting openness
A
statement from the Petroleum Ministry, however, indicated that the
government has released its seventh annual report detailed financial
situation on oil production, which it argued will promote openness and
transparency.
“We are trying to increase transparency in the country’s oil and gas sector, specifically concerning the financial aspects.
“The
Ministry of Petroleum has produced this journal which will provide all
the information about our production, sales, and even the environment.
We include all the opportunities in South Sudan regarding refineries,
pipelines and other facilities. All this information is now available,
and everyone will have access to it,” the statement said.
The
report says South Sudan authorities are now in charge of all oil
operations. “The Ministry of Petroleum is dedicated to forming an
institutional structure and establishing business relationships in an
open and transparent manner.”
Inquiry findings
“Transparency
in marketing is the cornerstone to growing a new international customer
base mandated to conform to the highest ethical standards, and to
ensure oil revenue cash flows are conducted through proper channels.”
The
Ministry said it will in future be providing press releases recent
sales and production volumes, crude oil revenues, tariff and assistance
fee payments to Sudan as well as other relevant marketing data.
Claims
of oil revenue diversion aren’t new though. Last year, President Salva
Kiir opened an inquiry into the crude oil pre-sale arrangements after he
fired then Oil Minister Ezekiel Lol Gatkuoth, replacing him with Awow
Daniel Chuang. Those findings were yet to be made public.
Incomplete Cabinet
“The
previous government has been selling oil in advance and there has been
huge corruption in the oil sector as a whole,” said James Oryema,
representative of the Sudan People’s Liberation Movement-In Opposition
(SPLM-IO) which forms part of the new administration.
“We
want the oil revenues to be made transparent and the sale of oil in
advance to stop. We would also like to see an environmental audit
carried out because the sector has serious pollution issues.”
President
Salva Kiir is yet to name his full Cabinet, and all the former
ministers relinquished their posts last week. But being the world’s most
oil-dependent country (according to the World Bank), revenues from
petro sales could account for a large portion of its budget. The
transitional government needs at least $100 million to start running.
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