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Cablegate: Splm/Ncp Jointly Confront Corruption Through Political

VZCZCXRO9937
OO RUEHROV
DE RUEHKH #1603/01 3051018
ZNR UUUUU ZZH
O 311018Z OCT 08
FM AMEMBASSY KHARTOUM
TO RUEHC/SECSTATE WASHDC IMMEDIATE 2208
INFO RUCNIAD/IGAD COLLECTIVE
RUEHRN/USMISSION UN ROME
RHMFISS/CJTF HOA

UNCLAS SECTION 01 OF 03 KHARTOUM 001603

DEPT FOR AF A/S FRAZER, SE WILLIAMSON, AF/SPG
NSC FOR PITTMAN, HUDSON, PMARCHAM, AND MMAGAN
DEPT PLS PASS USAID FOR AFR/SUDAN, DCHA SUDAN
NAIROBI FOR USAID/DCHA/OFDA, USAID/REDSO, AND SFO
GENEVA FOR NKYLOH
USUN FOR DMERCADO
BRUSSELS FOR JADDLETON
USMISSION UN ROME FOR RNEWBERG, HSPANOS
ADDIS ABABA ALSO FOR USAU

AIDAC
SIPDIS

E.O. 12958: N/A
TAGS: PREL PGOV PREF EAID ASEC KPKO UNSC SU
SUBJECT: SPLM/NCP JOINTLY CONFRONT CORRUPTION THROUGH POLITICAL
INSTITUTIONS IN SOUTHERN KORDOFAN

REFS: A) KHARTOUM 1460
B) KHARTOUM 1455
C) KHARTOUM 1435
D) KHARTOUM 1427
E) KHARTOUM 1309

KHARTOUM 00001603 001.2 OF 003


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SUMMARY
- - - -

1. (U) Recent events in Southern Kordofan state serve as a reminder
of the divided, partisan nature of the state administration and the
continued potential for widespread conflict to erupt. Tensions
between the Sudan People's Liberation Movement (SPLM) Minister of
Finance, who is pursuing financial reform, and the National Congress
Party (NCP) state Governor, who opposes these measures, came to a
head on September 27 when the Governor dismissed the Minister
without consulting the SPLM Deputy Governor. Public reaction was
immediate, with protests and road blocks reported, as well as rumors
that the Deputy Governor had placed Sudan People's Liberation Army
(SPLA) units at Lake Abiad on standby. However, the situation
reportedly is now contained. State SPLM leaders are conferring with
party leaders in Juba, trying to confirm whether First Vice
President Salva Kiir approved the Governor's action. End sumary.

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STATE MINISTER EMBARKS ON FINANCIAL REFORM WITH PARLIAMENT'S SUPPORT

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2. (U) Dr. Ahmed, Southern Kordofan's SPLM State Minister of
Finance, said he embarked on a reform program within the ministry
after assuming office in early 2008. The state's financial
practices had already come under scrutiny by the NCP in mid-2007,
when Second Vice President Ali Osman Taha noted "financial
irregularities" during a visit and called for an official
investigation into the state's financial practices. However, in Dr.
Ahmed's view, the inquiry was poorly conducted, and its findings
were inconclusive. Following the signing of the Comprehensive Peace
Agreement (CPA), the Department of Economics and Planning was
separated from the State Ministry of Finance to form its own
ministry. The SPLM took the ministerial position for Economics and
Planning, while the NCP continued to hold the ministerial post for
Finance in 2005. Upon the CPA-mandated government rotation in late
2007, the SPLM took over the position of Minister of Finance; the
NCP the Minister of Economics and Planning. At this point, the NCP
Governor issued a decree channeling all development funds through
the Economics Ministry, leaving the Finance Ministry in charge of
the state's operational expenses and salaries. A new bank account,
to which the Governor has access, was established to receive state
development funds.

3. (U) Dr. Ahmed claims that after he took office, the state
legislative assembly gave him bipartisan support to introduce more
formal and transparent processes to manage the state's finances.
According to Dr. Ahmed, his review of the ministry's systems
revealed financial irregularities, as well as the state Governor's
direct intervention in operations. For example, he noted that the
ministry was paying salaries directly to state employees instead of
receiving budgets from the ministries. The latter system would
ensure budgets are approved by the state assembly with funds then
transferred to individual ministries to pay their staff. Dr. Ahmed
believes the system being used bypasses ministerial planning and
legislative approval processes, allowing for ad hoc payment
decisions, and making it difficult to catch "ghost employees"
remaining on the payrolls. By decentralizing budgetary
decision-making and allowing for legislative oversight, Dr. Ahmed
hoped to make the process more transparent and less open to
interference.

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REFORM MEASURES - CLEANING HOUSE OR PERSONAL ATTACK
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4. (U) Dr. Ahmed indicated that the ministerial review uncovered a
number of financial irregularities. Many were related to the NCP
Director General's (DG) issuance of payments at the direction of the
Governor - without adhering to procedures or to legislatively
approved state budgets. Dr. Ahmed first relieved the DG of certain

KHARTOUM 00001603 002.2 OF 003


responsibilities, then, as he began introducing more formal
processes for allocating funds, dismissed him from his post.
According to Dr. Ahmed, the Governor saw these moves as an
investigation of the Governor himself, although Dr. Ahmed assured
him that he was concerned only with reforming the ministry to spend
state funds more responsibly and effectively, not with the
Governor's actions.

5. (U) The Governor reappointed the DG without consulting Dr.
Ahmed. In turn, Dr. Ahmed refused to allow the former DG to resume
his duties, reiterating to the Governor his commitment to correcting
financial irregularities within his Ministry. Ahmed also informed
the Governor that any such decision must be taken in consultation
with the Minister. The Governor requested that the DG be allowed to
resume his duties for a period of a few months, which Dr. Ahmed
rejected.

6. (U) State Secretary General Abdalla Toum gives a contradictory
version of events. (Note: While Toum claims to be politically
independent, his positions on issues line up with those of the NCP
and the NCP Governor who appointed him to his position. End note.)
Toum told USAIDoff on October 6 that Dr. Ahmed was dismissed for
having replaced the ministry's DG with a corrupt official, Kamis
Ahmed Suliman. The Governor opposed Suliman's appointment because
he had been previously fired by the state Internal Auditor for
corruption. According to Toum, the Minister then created chaos in
the ministry by reshuffling his staff, putting junior members in
positions supervising more senior staff. The Governor consequently
wrote to Salva Kiir, explaining the situation and reportedly
obtained the First Vice President's approval to dismiss Dr. Ahmed.

- - - - - - - - - - - - - - - - - - - - - - - - - ---
INITIAL REACTION TO THE GOVERNOR'S MOVE RAISES TENSIONS IN THE
STATE
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7. (U) According to a number of SPLM sources, word initially spread
that the Deputy State Governor Daniel Kodi put SPLA units at nearby
Lake Abiad on alert. These sources indicated tensions around the
state were high, with protests against the Minister's dismissal, and
the Deputy Governor and citizens threatening to block roads if Dr.
Ahmed was not reinstated. SPLM leaders and members of the Deputy
Governor's advisory committee, including the SPLM co-chair of the
Presidential Assessment and Evaluation Commission, the SPLM
Secretary of the state and the SPLM Deputy Chairman of the state
legislature, dismissed reports that the Deputy Governor had
officially called for the SPLA to be on standby, while confirming
reports of a protest in Dilling town and threats to close roads.
Despite some unrest, they felt the situation would remain calm.
According to the SPLM Secretary, the SPLM was informing the public
of the Governor's unconstitutional management of Southern Kordofan.
All SPLM sources state that the SPLM is prepared to freeze its
participation in the state government if Dr. Ahmed is not
reinstated.

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SPLM TAKES MATTER TO JUBA TO SEEK POLITICAL RESOLUTION
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8. (U) Immediately after Minister Ahmed's dismissal, SPLM members
in Rashad reported to USAIDoff that Salva Kiir had called the Deputy
Governor to deny that he had approved the action. On October 6,
USAIDoff spoke with the Southern Kordofan SPLM Secretary, who was in
Juba for meetings on the issue. He had explained the situation to
GoSS Presidential Affairs Minister and Kiir-confidant Luka Biong
Deng and scheduled a follow-on meeting with party leaders Ann Itto
and Pagan Amum, who are expected to arrange another meeting with
Salva Kiir. State SPLM Secretary Arnu was still waiting for
confirmation that Salva Kiir did not approve of the minister's
dismissal. Arnu confirmed Dr. Ahmed's version of the chain of
events leading to his dismissal.

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STATE PARLIAMENT DRAWS BIPARTISAN SUPPORT AGAINST CONSTITUTIONAL
ABUSES
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9. (U) According to Southern Kordofan SPLM leaders, including the
Finance Minister and SPLM State Parliament Deputy Chair, the state

KHARTOUM 00001603 003.2 OF 003


parliament has drafted ten resolutions, six directives and 12
recommendations opposing the Governor's corrupt practices, which
they plan to adopt when meetings resume on October 15. They
indicate that a number of NCP parliamentarians support these
measures, either officially or privately. According to the Finance
Minister and the Parliament Deputy Chair, a group of NCP
parliamentarians has been lobbying national NCP leaders, including
Presidential Advisor Nafie Ali Nafie, to dismiss the Governor. In
response, the Governor has attempted to dismiss a number of NCP
parliamentarians, all of whom cited the move as unconstitutional and
refused to leave office. In an October 6 conversation with
USAIDoff, NCP Chairman of the State Parliament Bellandia denied
reports of action by legislators, indicating that the issue did not
involve the parliament and that parliamentarians are not involved.

10. (U) Neither the NCP Chair nor the SPLM Deputy Chair believes the
executive knows how to administer the state, indicating that
partisan politics keep the administration divided and unable to
compromise and make decisions. Conversely, they see the state
legislature working in a more bipartisan manner, compromising and
collaborating on important issues. They attribute this success to a
USAID-supported SPLM/NCP joint training in Uganda, where
parliamentarians studied democratic institutions and processes, and
were able to meet with Ugandan opposition party leaders to learn how
parties can work together to serve constituents' interests.
Twenty-six parliamentarians acquired negotiation, debate and
administrative skills, allowing them to effectively run meetings,
debate, and compromise to arrive at decisions. The Chair and Deputy
Chair maintain that the state executive must also understand how a
decentralized democracy works - including how the executive
interacts with the legislature - if the state government is to
function.

- - - -
COMMENT
- - - -

11. (U) This recent drama is a reminder of the very tenuous state
of affairs in Southern Kordofan state, currently the most volatile
of the "three areas" given special status under the CPA. If it is
determined that Salva Kiir did in fact approve the Minister's
dismissal, then the Nuba SPLM are likely to feel further alienated
from the national SPLM party. If Kiir did not approve the dismissal,
then a line drawn in the sand between the two parties could lead to
a crisis, with the SPLM freezing participation in state government.
Given the highly militarized nature of the state, any major
political confrontation risks boiling over into confused, widespread
conflict. (Note: previous reports of an arms build-up among
Misseriya Popular Defense Forces (PDF) have been confirmed by Ahmed
Gour, the SPLM Misseriya member of the Presidential Assessment and
Evaluation Commission. In a discussion with USAIDoff on October 1,
Gour expressed concern over the Sudan Armed Forces' SAF channeling
of arms to the PDF through the Babanosa and Kailak Commissioners in
preparation for a potential retaliation by the SPLA Nuer over last
year's fighting in Kharasana (REF A). End note.)

12. (U) Electoral politics no doubt play a role in the hardening of
both sides' positions, as each side attempts to convince the public
that the other party is corrupt. However, detailed financial reform
plans provided to USAIDoff by the Finance Minister over the past six
months, along with the Governor's repeated requests that donors
"give him their money in a sack" because he has trusted contractors
that can "get the work done," lends legitimacy to the Minister's
version of the events that led to his dismissal.

13. (U) Both SPLM and NCP Southern Kordofan state officials believe
that the involvement of national-level officials is needed to
resolve this issue. Last time, Presidential Affairs Minister Bakri
Salih, a Bashir crony, and SPLM Governor of next-door Blue Nile
state, Malik Agar, were able to defuse tensions. The recurrent need
for national officials to intervene to resolve political stalemates
at the state level reflects the sad state of affairs in Southern
Kordofan and the state government's inability to function
effectively. USAID's Democracy and Governance office is initiating
a program to provide technical support and training to select state
ministries and the legislature to improve management capacities for
administering state affairs.

FERNANDEZ

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