CPA Fiscal Oversight Chairman shows independence

UNCLAS SECTION 01 OF 02 KHARTOUM 001696 SIPDIS SENSITIVE, SIPDIS DEPT FOR AF/SPG, AF/EPS, S/CRS, AF SE NATSIOS DEPT PLS PASS USAID FOR AFR/SUDAN, AND ALSO PASS USAID E.O. 12958: N/A TAGS: PREL PGOV EAID CDC SU SUBJECT: CPA Fiscal Oversight Chairman shows independence ¶1. Summary: As Coordinator of the Wealth Sharing Working Group, Embassy organized a special AEC plenary October 24 featuring Dr. Mohammed Osman Ibrahim, Chairman of the GOS's Fiscal and Financial Allocation and Monitoring Commission (FFAMC). The presentation was organized to seek additional insight concerning the role, duties, and performance of the FFAMC, particularly given the challenges faced by the Wealth Sharing Working Group in finalizing its two-year progress report on CPA implementation. There was a good turnout for the information session, with representatives from all the Coordinators' embassies, and most of the observer organizations. The Wealth Sharing Working Group's matrix on the wealth sharing provisions of the CPA was formally adopted by the AEC at its October 30 plenary (to be reported separately),and will be presented by the AEC Chairman to the President of Sudan. End Summary ¶2. Dr. Ibrahim's 30-minute PowerPoint presentation demonstrated that the FFAMC is indeed functioning. It has made a good start in monitoring the various wealth-sharing provisions of the CPA, its main function. However, in responding to questions from the SPLM, he stated that his commission was still waiting for information from various GOS bodies, especially the Ministry of Finance. As long as the GOS delays providing this information (especially in regard to oil revenues),the FFAMC will have difficulty fulfilling its duties. ¶3. The question and answer phase following the presentation opened with a question from the SPLM: why isn't the FFAMC publishing all the figures related to the allocation of oil revenues, not just the amount allocated to the Government of Southern Sudan (GoSS),but the larger amount going into the national coffers? Chairman Ibrahim replied that his Commission had not yet published any information regarding oil revenues. It has submitted a request for such information to the Ministry of Finance as part of a list of other information requests, in a letter dated September 2, 2007. The FFAMC is still awaiting a response from the Finance Ministry. ¶4. The SPLM then followed up with other questions relating to transparency. It asked whether the Finance Ministry was usurping the FFAMC's duties by publishing itself the information on oil revenues and determining the allocation of those funds. Dr. Ibrahim replied forthrightly that "I share your concerns completely." He said the FFAMC should have a protocol with the Finance Ministry, consonant with the Wealth Sharing Protocol and the Sudanese Constitution, delineating how the two bodies are to cooperate. He thanked the SPLM for their points, saying he would raise the issues in the Commission's talks with the Finance Ministry. ¶5. In response to an SPLM question regarding how the FFAMC was acting to implement the Panel of Experts' recommendations, Ibrahim said that the recommendations had been passed to the office of the Presidency, since it was up to the Presidency to distribute government functions. One of the major duties of the FFAMC, he added, is to monitor all sources of national revenue, all of which should go into the National Revenue Fund (NRF). The FFAMC should also monitor how the funds are distributed, and how they are utilized after allocation at each level of government. Equal Opportunity for Southerners? -------------- ¶6. Responding to a pointed question from the SPLM on why there were no Southerners among his staff members sitting behind him in the conference room, Dr. Ibrahim said that he did have one staff member from the South. He assured the audience that every job on the FFAMC is open to all applicants on the basis of merit, with no discrimination made on the basis of race, religion, geographical origin. Following the Money not made easier by the GOS -------------- - ¶7. The SPLM noted that the Chairman himself had drawn attention to the fact that the national government is taking a larger percentage of oil revenues from the South than it was entitled to under provisions of the CPA. (Note: The CPA prescribes 55.2% to the national government, while actual transfers are 61.6%). Dr. Ibrahim confirmed that fact, adding that the SPLM was correct in stating that the FFAMC should act in a monitoring capacity over the Ministry of Finance, and the latter must act according to the percentages clearly enumerated in the Wealth Sharing Protocol and the CPA. ¶8. The NCP delegation addressed this issue, claiming that the reason for the discrepancy was the result of the signing of peace accords for Darfur and the East. Those agreements had fiscal implications, burdening the national government with additional responsibilities and expenses, he said. In reply to this assertion, Chairman Ibrahim said flatly that "I hope that explanation is correct." He stressed again that the NCP and the Finance Ministry are obliged to follow the clearly-stated percentages. He again noted that the FFAMC is awaiting a reply from the Ministry of KHARTOUM 00001696 002 OF 002 Finance. "It is the FFAMC's responsibility to provide answers" in the interests of transparency, he said. ¶9. Bringing the meeting to a close, DCM Powers thanked Dr. Ibrahim for the candor with which he had replied to questions. He summarized the proceedings, saying that it was obvious to the entire AEC that the FFAMC faces great challenges, which Dr. Ibrahim and his staff were acting to meet. Comment -------------- ¶10. AEC members, particularly the international observers, took note of Dr. Ibrahim's forthrightness, and his spirit of independence. He did not hesitate to endorse SPLM concerns, or to state that the GOS was not abiding by some terms of the CPA. He described how the Finance Ministry is impeding the FFAMC's work by not responding in a timely manner to his requests for meetings and for information. Dr. Ibrahim has extensive past experience as an official of the National Finance Ministry. He was enthusiastic in responding to our request that he address the AEC, and stated that he took the need for transparency in his role as FFAMC chairman quite seriously. His replies demonstrated that he understands that he can use the concerns expressed by the AEC as leverage in his discussion with the GOS. Going forward, we will be looking for additional ways to support the FFAMC. FERNANDEZ