United Nations experts say South Sudan is close to securing a $13 billion loan from a United Arab Emirates company, despite the country having difficulty managing debt backed by its oil reserves. ing.
In its report to the United Nations Security Council, the Committee of Experts said loan documents it reviewed show that the deal with the Hamad Bin Khalifa Project Authority is the largest oil-backed loan in South Sudan’s history. He said that it shows.
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Experts monitoring the arms embargo on South Sudan said in the oil section of a report obtained this week by The Associated Press that “repayment of this loan will tie up most of South Sudan’s revenue for years, depending on oil. It’s very likely.” price. ”
United Nations experts say South Sudan is close to securing a $13 billion loan from a United Arab Emirates company, despite the country having difficulty managing debt backed by its oil reserves. ing. (Photo courtesy of TIZIANA FABI/AFP via Getty Images)
The Hamad Bin Khalifa Projects Authority, registered in Dubai, has no phone number listed and its website is not functioning. The email address associated with your company is back. The United Arab Emirates’ mission to the United Nations declined to comment, saying Hamad is a private company.
South Sudan gained independence from Sudan in 2011 after decades of civil war that claimed millions of lives. Oil is the backbone of the young country’s economy.
Immediately after independence, South Sudan fought a civil war from 2013 to 2018, and rival President Salva Kiir and Vice President Riek Machar signed a power-sharing agreement and formed a coalition government. South Sudan is under pressure from the United States and other countries to more quickly implement the 2018 peace deal that ended the civil war and prepare for elections.
South Sudan produced an average of about 149,000 barrels of liquid fuel per day in 2023, according to the latest information from the U.S. Energy Information Administration. The landlocked country uses Sudan’s pipelines to transport crude oil to Port Sudan for transport to global markets. The Sudanese government pockets $23 per barrel in transit fees for oil exports.
South Sudan’s Information Minister Michael Makuei Roos told reporters in February that external factors, including Sudan’s still-raging civil war, were hurting South Sudan’s oil exports. He also said oil wells, which were flooded during the past rainy season’s deluge, are not yet fully operational.
The oil section of the expert report said loan documents from UAE companies signed by South Sudan’s finance minister between December and February showed the loans were split into multiple installments. .
According to the document, about 70% of the loan will be allocated to infrastructure projects, with initial disbursements exceeding $5 billion, the panel said. After a three-year grace period, “the loan will be secured against crude oil delivery for up to 17 years.”
The Committee of Experts has raised serious questions about South Sudan’s oil-based debt.
South Sudan has lost an International Center for Settlement of Investment Disputes case arising from a $700 million loan it received from Qatar National Bank in 2012.
At the time the panel produced its report, the court had not reached a decision on how much the government should pay, but the Sudan Tribune reported on Sunday that South Sudan had been ordered to pay more than $1 billion.
The panel of experts also confirmed that the government owed $151.97 million to the Eastern and Southern African Trade and Development Bank arising from previous oil-related transactions.
South Sudan was due to hold elections by February 2023, but the date was postponed from August last year to December 2024.
In early April, South Sudan’s president warned lawmakers “not to cling to power, just weeks after his former rival turned vice president proposed further postponement of elections.”
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The panel of experts said this would be a “major milestone” and warned the country’s leaders were running out of time to “avoid divergent expectations fueling further tensions and conflict.” .
Experts also referred to the humanitarian crisis in South Sudan. According to the United Nations, an estimated 9 million people out of the country’s 12.5 million people are in need of protection and humanitarian assistance. The number of refugees fleeing war in neighboring Sudan is also increasing, further complicating humanitarian assistance to affected populations in the South Pacific. Internal conflict in Sudan.
