No Foreign Aid, No Peace in South Sudan

JUBA — South Sudan’s leaders spent the last two years locked in a brutal war for power that has killed tens of thousands of people. Their forces stand accused of war crimes, including the rape and massacre of civilians, and the economy is near collapse.

But now that President Salva Kiir and rebel leader Riek Machar have struck a political bargain that brings them back where they started, with Machar retaking his previous vice presidential post, the rest of the world may have to pick up the tab.

The peace deal, signed under intense international pressure back in August, is supposed to put the two men in a power-sharing transitional government for three years before fresh elections can be held. It also spells out steps to reunite and reform the country’s fractured army. But so far the two sides have done little to put the deal into practice. Fighting has continued in the northeast of the country, and the rebels have not yet returned to the capital. The deadline to form a transitional government passed on Nov. 26 with no result. Now an advance team of rebels, not including Machar, is due in Juba on Friday for talks aimed at implementing the deal, but it’s anyone’s guess if they’ll show.

With the economy failing in the meantime, the current government says it needs a bailout to meet its current obligations and to rebuild after the war. In a speech to parliament on Nov. 18, Kiir admitted that his government is nearly out of cash after it pre-sold oil exports, which account for well over 90 percent of revenue. Fighting has already shut down oil fields, slashing production by nearly half. The government now receives under $10 per barrel, the result of low global oil prices and the high fees it pays to use Sudan’s pipeline. Inflation is spiraling. The dollar sells on the street for more than five times its official rate, squeezing imports and putting basic goods like bottled water beyond many citizens’ grasp.

“South Sudan needs to be assisted,” Foreign Minister Barnaba Marial Benjamin told Foreign Policy in an interview. “And the only way you do it is to seek loans from friendly countries, from the international organizations.”

But Benjamin’s entreaty has so far fallen on deaf ears.

“Right now, it’s our position and most of the donor community that we’re not talking about a bailout; we’re not talking about budget support; we’re talking about a phased approach where we will be trying to meet whatever steps the government does,” said Gunnar Holm, deputy ambassador to South Sudan for Norway, a member of the so-called “Troika” of top donors to South Sudan that also includes the United States and Britain.

Such wariness to fund a Kiir-Machar government is understandable. There are massive human rights concerns, and the two men built a legacy of corruption in the eight years they ran South Sudan before the war.

There’s also the moral question of giving money to a government that spent $850 million dollars to fund a war — and is still buying weapons — while foreign nations spent billions of dollars on humanitarian aid to keep alive hundreds of thousands of civilians affected by the fighting.

“We’re constantly in this discussion: Why should we keep putting money on this when according to the latest report they’re in the market for more attack helicopters?” said one Western diplomat in Juba, who requested anonymity to speak freely.

Far from funding a bailout, donors say that there won’t be any increased assistance at least until Machar returns to Juba and forms a transitional government with Kiir. But even this may require spending: One key sticking point involves 7,000 troops loyal to Kiir who are supposed to redeploy outside Juba as part of a planned demilitarization of the capital (so Machar feels safe to return). Kiir’s government says it doesn’t have the money to build new barracks, so foreigners must step in. Donors have rejected this excuse, so the vast majority of troops are staying put — while the government points the finger at the international community.

“If you genuinely really want peace for South Sudan, they should not be running away from this,” Benjamin said. “This is encouraging chaos.”

It’s an example of an emerging dynamic wherein South Sudanese leaders blame foreign reluctance to unlock additional funds for their own failure to live up to agreements.

“They’ll put the shopping list out, we’ll shy away and say, ‘We’ll pay for that, that, and that,’ and they’ll say, ‘See, you won’t pay [for everything], so it’s your fault [if the peace agreement falls apart],'” said the Western diplomat.

But donors may have little choice except to pay, according to Horn of Africa researcher Alex de Waal, who serves as the executive director of the World Peace Foundation. Writing in FP, de Waal points out that South Sudan’s peace compacts have historically involved paying off renegade generals in order to convince them not to fight.

“To keep the peace, South Sudanese leaders need enough funds, and the discretion to use them, to grease the wheels of their patronage machines and buy a real peace that’s not just on paper,” he argues. “If the U.S. [South Sudan’s biggest donor] is to involve itself in fixing conflicts … it needs to recognize this disagreeable truth.”

The patronage machine is likely to be further entrenched by the August peace deal, because the proposed transitional government will need to pay off rebels and government loyalists alike in order to keep the peace.

“The peace agreement has not fundamentally challenged the nature of political governance in South Sudan,” said Jort Hemmer, a senior research fellow at the Dutch Clingendael Institute’s Conflict Research Unit. “The elite compact broke down, now there’s been a re-stitch.”

Still, de Waal’s argument hasn’t swayed donors toward bilateral assistance, so Benjamin says his government has turned to the World Bank and the International Monetary Fund. Neither institution would speak to FP for this article, but the United States has reportedly begun discussions with the IMF on a “rescue package.” No details are available on these talks, which began more than two months ago.

Despite their reluctance to fund the patronage machine that could keep the peace, major donors have signaled their willingness to pay for development projects and governance assistance that don’t directly support the warring leaders. That means funding health, education, and civil society, as well as capacity-building projects to improve good governance through the three-year transitional period.

“In terms of economic development, any help the transitional government will need in terms of its capacity and whatever issues they might have in terms of the practical aspects of running the government, international partners are certainly willing to help,” said James Donegan, deputy chief of mission at the U.S. Embassy in Juba, adding that this funding would still require South Sudan to take initial steps toward reform.

Yet the development path is also fraught. From 2005, when a peace deal brought Sudan’s Second Civil War to an end and paved the way for southern secession six years later, until the outbreak of the latest conflict in December 2013, foreign nations poured billions of dollars of development aid into the south with little to show for it today.

“South Sudan has been a pilot for almost everything invented in donor circles, and we have to conclude that things went wrong and it’s too easy to just blame South Sudan’s leadership for that,” said Hemmer. “We need to do some soul-searching and see where things could be done better.”

Evidence of wasted development funds is easy to find. Health clinics remain understaffed and underused. Schools and hospitals were built with donor funds, only to be deliberately destroyed and looted during the war. Millions of dollars poured into capacity-building projects propped up a government that turned around and massacred its own people.

“It’s very difficult; it’s very delicate,” British Ambassador to South Sudan Tim Morris told FP. “[Before the war] we had a level of belief in the leaders of this country that was not justified, and it’s absolutely right that many of the same individuals are still in power or are coming back to power.”

With the Kiir and Machar slated to lead the transitional government, struggles over power and patronage are likely to undercut good governance and service delivery even during peacetime. This leaves donors with an unsavory choice: Pay generals to keep the peace or fund development projects that may not work. Either way, South Sudan’s road to recovery will be long and expensive — something donors may just have to accept.

Image credit: ASHRAF SHAZLY/AFP/GettyImages