On Saturday the world’s newest nation exuberantly celebrated its first independence day. The Republic of South Sudan, an area the size of Texas that is home to eight million people, has finally fulfilled its long-sought goal of freedom and self-determination. Independence however, is just the beginning.
CGD Policy Blogs
This is a joint post with Wren Elhai.
What everyone was expecting is now official. On July 9th, South Sudan will become the world’s newest country. But while the date is certain, there are still plenty of details to be worked out. There is no deal as of yet on sharing Sudan’s oil wealth, or on its nearly $40 billion in external debt. Successful resolution of the debt issue acceptable to both north and south and the international community is crucial to the success of the new nation and to avoiding a resumption of the long and bloody civil war.
Twelve months after the devastating earthquake, some of the fresh ideas CGD policy experts proposed to help Haiti through non-aid channels have gained traction, while others remain relevant, but have yet to be tried. The anniversary is a time to revisit progress and shine a light on untapped opportunities to assist Haitians in their reconstruction efforts through U.S. policies on trade, debt, migration, and more:
This is a joint post with Ross Thuotte.
Sudan’s crippling debt burden can be compared to an enormous onion – the story gets more and more complex as you begin peeling back the various layers. Yesterday, we wrote about Sudan’s two largest creditors – Kuwait and Saudi Arabia. But, there are countless other surprises beneath the surface. Here are three more: Austria, Denmark, and Belgium. These are not countries that one would automatically associate with Sudan. But, they are some of its largest creditors – collectively holding roughly $4.5 billion in claims.
This is a joint post with Ross Thuotte.
Two countries alone hold over 25 percent of Sudan’s crippling $35 billion debt burden. I’ll give you three guesses at who they might be. China? United States? France? All would be reasonable choices. But, they also would be wrong. In fact, Sudan’s two largest creditors are Kuwait and Saudi Arabia. Sudan owes the Kuwaiti government roughly $6 billion and the Saudi Government over $3 billion. Despite a flurry of recent loans, China is only number five on the list. These rankings represent more than monetary values owed – rather, they illustrate who will have the most important voices around the debt workout table when the time comes.
A 2011 referendum in Southern Sudan will determine the sub-nation’s independence – and it’s just one month away. Ahead of the South’s possible secession, Sudanese leaders are scrambling to find solutions to a host of questions, a critical one being: What should be done with Sudan’s crushing $35 billion external debt burden?
This post also appeared on the Huffington Post.
Next week, President Obama, UN Secretary General Ban Ki-moon, and other global leaders will meet with Sudanese leadership to discuss the upcoming referendum. The stakes are huge. In January, southern Sudanese will vote on whether to secede and launch a new, independent country. It’s hard to imagine them not supporting the breakaway vote given their decades’ long fight for independence. Roughly 2 million people died in that struggle. The multi-million dollar question is – what will Khartoum do? Will they let the referendum happen? Will it be fair and transparent? If so, will they respect the results? The meeting next week will grapple with these critical issues.
Clearly, Khartoum has a lot of lose.
This week, Liberians celebrated in the streets – faces painted, drums blaring, and dancing with abandon. They’re not rejoicing over some recent triumph by the Liberian soccer team or a local festival. The streets of Monrovia were overflowing because of debt relief. That’s right, debt relief. On Tuesday, Liberia secured nearly $5 billion in irrevocable debt relief from the World Bank, IMF, African Development Bank, and bilateral creditors. It’s a massive sum
Following the devastating earthquake in January, CGD experts offered fresh ideas on how the U.S. and the international community could help Haiti rebuild, particularly through non-aid channels. Several recent developments in the U.S. legislative branch reflect or build upon these ideas:
When I was writing about third world debt a decade ago, I watched Jubilee 2000 and other debt cancellation campaigners pound their way to victory with simplistic claims about the importance of debt cancellation, such as that principal and interest payments were diverting enough government revenue from poor countries' health budgets to kill 19,000 children per day. I wondered: are they naive or am I?