SOUTHERN SUDANESE FINANCE MINISTER COMMENTS ON

C O N F I D E N T I A L SECTION 01 OF 02 KHARTOUM 001072 SIPDIS DEPT FOR S/USSES AF AND EB E.O. 12958: DECL: 09/24/2014 TAGS: EFIN KDEM PGOV PREL UN SUBJECT: SOUTHERN SUDANESE FINANCE MINISTER COMMENTS ON RELEASE OF SEIZED CASH, ELECTION AND REFERENDUM Classified By: CDA REWhitehead for reasons 1.4 (b) and (d) ¶1. (C) Summary. Charge met with Government of Southern Sudan (GoSS) Minister of Finance and Economic Planning David Deng Athorbei on September 22 to discuss the return of USD seven million in cash from a Citibank courier flight. Deng committed to the return of the money "in a very short time" and explained why the GoSS seized the cash in the first instance. Conversation turned to negotiations between the Sudan Peoples Liberation Movement (SPLM) and the National Congress Party (NCP) over 2010 elections and the 2011 referendum in which the possible sovereignty of the South will be determined. Deng said that SPLM leadership increasingly favors running no candidate for the national presidency. He expressed concern about the referendum not coming off but said that recent discussions within the SPLM had focused on what needs to be done to get the enabling referendum bill passed. End summary. -------------- Stand and Deliver -------------- ¶2. (C) Through the good offices of the World Bank representative, Charge tracked down Minister Deng in the Rotana Hotel as the latter prepared to depart for London to participate in a conference. The Minister said that he was aware of a letter from the Special Envoy to GoSS President Salva Kiir on the need for the return of USD seven million in cash that had been seized by GoSS security officials when an aircraft chartered by Citibank out of Nairobi had landed to refuel in Wau. The flight was to have continued on to Darfur to deliver the money to UNAMID to cover peace keeper salaries. Charge gave Deng the copy of a second letter drafted by a senior Department of Treasury official currently in Juba that explained that the funds in questions had not entered Sudan in violation of US OFAC or other financial sanctions. Charge warned Deng that further delays in releasing the funds to Citibank/the UN would damage GoSS credibility. Deng agreed that the GoSS did not want to offend any party to the transaction and committed to writing a letter to the authorities in Juba instructing them to return the funds. He said that we would also inform President Kiir of this action. Pressed on when the funds would be released, Deng said that he thought "in a very short time." ¶3. (C) Deng said that the GoSS was aware of funds being flown into Sudan from Nairobi in what the GoSS believed was a contravention of US financial sanctions. For that reason, GoSS security officials had searched the plane when it refueled in Wau, Southern Sudan, and seized the funds. Deng continued that the GoSS had received no advance notification from anyone that the flight was carrying money for the UN, and that papers presented by the courier did not indicate that the ultimate recipient was UNAMID, or that an OFAC exception/license for such transfers existed. He said that the papers indicated a Citibank to Bank of Khartoum transfer, and GoSS authorities accordingly confiscated the funds. Charge suggested that better future coordination between the various entities involved in this transaction could avoid similar problems. -------------- Election and Referendum Issues -------------- ¶4. (C) Deng said that he had spent the day discussing election and referendum issues with senior SPLM officials. There was growing SPLM concern that the NCP would block passage of the referendum law. Charge observed that some NCP officials had offered similar statements about the indifference of the SPLM on census and related election issues. Deng said that some SPLM insiders were moving toward parliamentary legislation that would deal with elections and the referendum in a single package. Deng reviewed possible political deals that could facilitate census and elections legislation, including the partnership option that the NCP strongly favors. Deng said that it would be difficult for SPLM to endorse the NCP presidential candidate, President Bashir, but that there was growing support for fielding no SPLM challenger. This would transform the executive election into a strictly northern affair. ¶5. (C) Deng repeated the usual SPLM position that the NCP would try to block the 2011 referendum from taking place, but admitted that there was room for compromise. He reviewed with Charge possibilities for allowing Southerners, as KHARTOUM 00001072 002 OF 002 defined by both parties, to vote in certain areas of the north and a list of six Western or neighboring African countries in which there are large Sudanese expatriate communities. He said that a "reasonable" quorum of registered (not eligible) Southern voters might be possible, and that ballot box and other unresolved issues were not insurmountable. The SPLM was also ready to discuss important post referendum issues such as wealth sharing, banking, borders and citizenship. He cautioned, however, that failure to pass a referendum act risked setting off a dangerous chain of events between the North and South. Deng said that he was open to future discussion on these vital issues. -------------- Comment -------------- ¶6. (C) The definition of "a very short time" in South Sudan is imprecise, but Deng clearly understands the need to resolve the issue of confiscated UN funds. Deng has not been one of the SPLM officials closely involved in Comprehensive Peace Agreement issues, but he is a respected insider who has held ministerial positions since the inception of the GoSS. While he does not have a full grasp of the details, his comments that the SPLM is looking for ways to resolve the impasse on the election and referendum were encouraging. WHITEHEAD