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Cablegate: Governance, Capacity and Infrastructure Challenges In

VZCZCXRO3232
PP RUEHROV
DE RUEHKH #0693/01 1221309
ZNR UUUUU ZZH
P 021309Z MAY 07
FM AMEMBASSY KHARTOUM
TO RUEHC/SECSTATE WASHDC PRIORITY 7083
INFO RUCNIAD/IGAD COLLECTIVE

UNCLAS SECTION 01 OF 02 KHARTOUM 000693

SIPDIS

SIPDIS
SENSITIVE

E.O. 12958: N/A
TAGS: PGOV PINR PREF ECON EAID KDEM SU
SUBJECT: Governance, Capacity and Infrastructure Challenges in
Southern Sudan Two years After CPA

Ref: a.) Khartoum 613, b.) Khartoum 591

1. (SBU) Summary: ConGen Juba staff visits to key Southern Sudan
cities reveal weak but emerging local governments trying to fill the
void of undelivered services from the central government. Capacity
is limited, with most decision-making concentrated in a few people
trained in the Diaspora. Infrastructure remains almost as limited
as before the Comprehensive Peace Agreement (CPA) was signed.
Nevertheless, returnees keep coming back, but are increasingly
frustrated and impatient with the state of the "peace dividends."
Blame for the lack of development is shared between Khartoum's
perceived efforts at destabilization of the South and the Government
of Southern Sudan's (GOSS) mismanagement, financial limitations, and
corruption. The majority of people appear to support separation in
the 2011 referendum. End Summary.

2. (U) In a series of visits over the last few months to key cities
in several states, specifically, Yei (Central Equatoria), Yambio
(West Equatoria), Torit (East Equatoria), Maluol Kan (North Bahr el
Ghazal,) Wau (West Bahr el Ghazal), Rumbek (Lakes), Malakal and Renk
(Upper Nile), Bor (Jonglei) and Bentiu (Unity), ConGen staff have
called on local leaders, NGO partners, UN officials, Sudan People's
Liberation Movement (SPLM) and Sudan People's Liberation Army (SPLA)
representatives to assess the state of social, economic, security
and political conditions. The GOSS generally gets a failing grade
on service delivery and local governments are struggling to provide
the basic necessities without much support from the center.

3. (U) Many state and local civil servants are not being paid
regularly because of the lack of funds at those levels. Local
officials note that key GOSS ministries, including health, education
and roads, failed to spend their fiscal year 2006 budgets, leaving
the local governments holding the bag on salaries and service
delivery. Local governments are also spending beyond their budgets
or taking out loans for their planned activities.

4. (U) In addition, the GOSS Ministry of Finance and Economic
Planning has reportedly failed to disburse funds to the states which
were allocated under the Southern Sudan January 2007 budget. GOSS
Ministers assert that the now suspended former Minister of Finance,
Arthur Akuien Chol, had refused to release their funds when
requested. Moreover, the 2007 budget provides for "block grants" in
the areas of health, education and agriculture, with the same amount
for each state regardless of size and population. Consequently,
even when the funds are released many states will still find
themselves unable to provide critical services.

Bloated Payrolls and Unskilled Workers
--------------------------------------

5. (U) An additional issue is the inequity in employee salaries,
when they are paid, and the levels of incompetence in the civil
service, resulting from the merger of employment systems with
different "ideologies," as one interlocutor described it. Southern
Sudan continues to carry pre-CPA employees from the Civil Authority
of New Sudan (CANS) system, who work alongside the newly hired GOSS
and local government employees, as well as staff originally employed
by the government in Khartoum. In some cases the GOSS and post-CPA
employees, who tend to be better educated, are paid and the CANS
workers are not. The South's payrolls are swollen with redundant,
aged, and ghost workers who are a holdover from the CANS system,
many of whom remain on the rolls as SPLM/A loyalists. The GOSS
admits that seventy percent of its budget, almost USD 50 million a
month, is used for salaries and state transfers and operating costs,
leaving little for development. The Yei Commissioner told ConGen
staff that he has over 2,000 civil servants in Yei of whom about 450
are from the GOSS. The CANS employees, who generally do not get
paid but receive an "incentive" only, lack a strong work ethic, the
Commissioner asserted.

6. (U) The GOSS Acting Minister of Finance Gabriel (Changson) Chang
has publicly criticized the gap between revenue and spending at the
central level and has proposed to establish a cash management
committee to limit government spending. Changson has also called
for a hiring freeze and wants to substantially pare down the
payrolls. At the local level this is nearly impossible to do,
according to the Chairperson of the Anti-Corruption Commission, who
notes that local officials fear political retribution if they purge
the rolls.

Services Not Delivered
----------------------

7. (U) There is generally little evidence of any public
infrastructure "peace dividend" in the rural areas or major towns
outside of Juba. What projects there are have been provided by
international donors, private organizations and religious groups.
There are very few new health facilities, primary schools, or water
sources established by the GOSS. Donors are under enormous pressure
to support the development plans of GOSS Ministries but face rising
costs, challenging logistics and lack of upkeep of newly built

KHARTOUM 00000693 002 OF 002


facilities.

8. (U) The schools that exist are primarily simple mud and thatch
buildings with little or no furniture, minimal supplies, if any, and
often containing over a hundred children to a class. Local
officials acknowledge that there is not much education going on in
such settings, but stress that people want their children to be in
some kind of school no matter how ill-equipped. The Yei
Commissioner complained that his county was overrun by parents
seeking to enroll their children in his schools because they were
perceived as better than the even more austere structures in the
surrounding countryside. Likewise, in Rumbek we witnessed dozens of
people at a hospital despite an almost total lack of drugs or
trained medical personnel.

But Lights on in Yei
--------------------

9. (U) A good news story ConGen staff observed is USG-funded
electrification in Yei town provided by the National Rural
Electrification Cooperative Association (NRECA). NRECA is part of
the Southern Sudan Rural Electrification Program funded by USAID to
improve security and economic opportunities for local industry and
commerce through the increased availability of electric power. Yei
is the first and only city in Southern Sudan to have consistent
lights restored. There is an impressive economic boom in Yei town
evident in the pedestrian traffic at night and the new businesses
that have sprung up and expanded. NRECA is concerned, however,
because the local authorities have not paid their bills for months,
putting in jeopardy the sustainability of a commercial power system.
Local officials harped about not getting funds from the GOSS, but
promised to enter into a dialogue with NRECA to address the arrears
and keep the lights on.

And Still they Come
-------------------

10. (U) Despite the harsh conditions and lack of services in many of
the rural areas and small towns, the reports on numbers of returnees
is impressive. UNHCR continues to repatriate Sudanese from Uganda,
Kenya, Ethiopia, Egypt, Libya, the Central African Republic, and the
Democratic Republic of the Congo, assisting over 50,000 refugees
since 2005. Approximately 300,000 remain in neighboring countries
and UNHCR plans to assist over 100,000 in 2007. These returnees
are, however, overwhelming the schools, hospitals and other services
in some communities, particularly urban towns, and are an increasing
source of land disputes. Yei has reportedly grown from a little
over 90,000 people last year to an estimated 212,000 this year.
Nevertheless, while land disputes are a source of concern they have
not reached alarming proportions, but raise issues which local
authorities and some international organizations are working to
manage.

Who is to Blame?
----------------

11. (SBU) There is growing anger that some in the GOSS are getting
fat while the local communities go hungry. One government official
in Yei showed ConGen staff the well-built house of a former GOSS
Finance Ministry official in the midst of extreme poverty. Others
openly criticize GOSS officials for neglecting the poor and for
supplying themselves with cars, offices, frequent travel, as well as
foreign schools and medical care for their families. These critics
are equally harsh in condemning what they describe as Khartoum's
efforts to support militias and maintain Sudan Armed Forces in the
South to destabilize the area. The SPLA, as well as local and GOSS
officials, continue to assert that Khartoum is supporting "Other
Armed Groups" and the Lord's Resistance Army in the South
(reftels).

Separation the Goal
-------------------

12. (SBU) In response to questions on efforts in support of the
census, 2009 elections and the subsequent referendum, local
officials and average people speak little of the first two, but
anxiously await a chance to "vote for separation." These people
acknowledge a disconnect between the rhetoric of their SPLM leaders
who publicly espouse a unity strategy, but who say they will be
guided by the people, and the sentiments of the people who at this
moment want separation from the North. There is little support
among the average Southern Sudanese we meet for co-existence under a
unified state. The distrust of the North and the desire to be free
of Khartoum's influence remains strong. The apparent lack of more
"peace dividends" is both the cause and effect of this sentiment in
many Southerners' view.

POWERS

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