Khartoum orders fuel cuts to support army

Sudanese soldiers Khartoum – Abed Algayom Ashmeag The Sudanese Parliament yesterday, endorsed a bill to counter South Sudan aggression. The session, chaired by Speaker of the House, Ahmed Ibrahim Al-Tahir, endorsed in principle a bill known as “Repulsion of Aggression and Accountability of Aggressor Act, 2012” which provides for taking of stringent measures to stop atrocities and hostilities.
The Act aims at stopping aggression of the Government of South Sudan, its army and the suspicious states and organizations which support them.
Article “4” of the Bill provides for discontinuation of all form of negotiations and dialogue with the Government of South Sudan and that South Sudan would be held fully responsible for the aggression.
Article “5” of the Bill prohibits transit or exportation of any goods or commodities to the aggressor whose property on Sudanese territories will also be confiscated and Sudan’s investments in the aggressor country will be withdrawn.
The article also prohibits provision of assistance to the aggressor, movement of its diplomats would be restricted and diplomatic representation reduced.
The Bill, which was endorsed after intensive debate by the MPs, will be approved in its final form at a session of the House next week.
The government of both South and East Darfur states started to implement the directives of the Sudanese Parliament, entailing the prevention of exporting goods and commodities to the state of the South.
Khartoum is expected to submit its response to the African Union Peace and Security Council (AUPSC) to its issued decision regarding the situation between Khartoum and Juba on Thursday. However, Khartoum stressed that it does not mind the deployment of international troops on the joint borders.
The spokesman of South Darfur government Ahmed al-Tayeb announced that formal guidance have been issued to all merchants and citizens in the states, especially those who cross the borders to the South territories.
He also added that the state authorities will take strict formal penalties against whoever violates this guidance. He pointed that these procedures came in response to Juba's attacks against Heglig.
The foreign minister of Sudan, Ali Karti said that negotiation with the South restricted to the security file, asking the African Union Peace and Security Council (AUPSC) to put more pressures on the government of the South.
Several government agencies in Sudan have been ordered to slash their use of petrol and civil servants have been ordered to donate two days of their salaries to support the army in the fight against South Sudan.
Following weeks of border clashes, finance minister Ali Mahmud al-Rasul, instructed state institutions and companies to set aside a portion of their budget to the war effort reported late Wednesday.
The official news agency added that “state employees must contribute two days' salary, and the funds would be transferred to "the account of the Campaign for Repulsion of Aggression."
SUNA also reported that "the minister of finance also decided on decreasing the weekly fuel quota for government vehicles by 50 percent".
The oil-processing facility and export pipeline in Sudan's main oil region of Heglig were burned and damaged during a 10-day occupation by South Sudanese troops. Both sides have blamed the other for the damage.
A manager at the facility said there has been no production since the start of the South's occupation on April 10 and it was unclear when the facility would reopen.
The manager also stated that the Heglig-area output was 50,000-55,000 barrels a day, accounting for about half the nation's crude production.
The Southern occupation of Heglig followed earlier clashes between the two nations late last month and has raised fears of a wider war.
Last Friday, Sudan declared that its army had forced Southern soldiers out of Heglig. South Sudanese President Salva Kiir had already announced his troops would leave under "an orderly withdrawal", which they completed on Sunday.
Several analysts believe essentially all of that was used for domestic consumption.
Several economists have also said that the loss of Heglig would worsen an economy already in crisis after South Sudan separated last July, taking with it about 75 percent of the formerly united Sudan's oil production and billions of dollars in revenues.
Before the South split in a referendum last year, Southern oil represented more than a third of Khartoum's revenues and its largest source of hard currency, leaving the government struggling for alternatives since then.
There has also been the issue of inflation, which has risen month after month, exceeding 20 percent, as well as Sudan's currency plunging in value. On the black market, one US dollar sells for roughly double the official rate of about 2.7 pounds per dollar.
The occupation of Heglig prompted an outburst of nationalist feeling in Sudan, where consumers and market traders struggling to cope with rising prices had earlier this year warned of social unrest over deteriorating living standards.
Under an emergency three-year programme announced last June and in response to the split with the South, Khartoum plans to cut spending and widen the tax base.
Economists say both targets are difficult to achieve, partly because the military's pre-Heglig share of the budget was estimated at up to 75 percent.
Khartoum has also lost out on potential fees from South Sudan for use of its pipeline and port.
In a key dispute, the two sides were unable to agree on how much the South should pay, leading the Juba government in January to shut its production after Khartoum began seizing the oil in lieu of payment.
The Sudanese president Omar al-Bashir said last Friday that his country no longer wanted southern oil fees and would not reopen its pipeline to Juba's oil.
The budget deficit is projected to reach about $8 billion between 2011 and 2015, according to an international economist.
Roughly $38 billion in foreign debt, along with US economic sanctions, limits Sudan's access to external financing.
Several analysts have said that the bankrupt nation could turn to Arab and Muslim nations for financial help in light of the crisis aggravated by fighting with South Sudan.
The International Monetary Fund has forecast Sudan's real gross domestic product to decline by 7.3 percent this year, while consumer prices are seen rising 23.2 percent.