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A COUNTRY WITHOUT A STATE

South Sudan is larger than Kenya, Rwanda and Burundi together, but with a population density one-tenth that of Uganda.1 It has enormous natural resources, but is one of the most underdeveloped areas in Africa, with virtually no infrastructure. The country comprises some 64 ethnic communities, and more than 80 languages.2 Its ethnic diversity is a source of great pride.

Different from many other African countries, whose history often have included large kingdoms and experiences of traditional statehood, the majority of Southern Sudanese are clan-based pastoralist or semi-pastoralist communities, posing special challenges to state- and nation-building. In other countries on the continent, liberation movements entered government offices of functional post-colonial institutions. This was not the case with Southern Sudan.

As one could expect, freedom fighters who had spent most of their lives in the struggle were not necessarily the ones best prepared for the task of taking over the semi-autonomous government of Southern Sudan in 2005. Although many had been governing liberated areas, these were still military administrations and not political governments based on at least some principles of the rule of law. In addition, corruption and nepotism soon prevented the building of stronger and more effective institutions.

Furthermore, assistance from the international community to support Southern Sudan in the right way, building the core functions of the state, proved to be partly patchy and uncoordinated, and partly non-existent. The latter was related to the CPA and the importance of not pre-judging the outcome of the referendum. Signals from Khartoum and the caution of donors and international stakeholders prevented institution building which could be interpreted as preparation for independence prior to the referendum in 2011. Although capacity building was happening, it was not done in the comprehensive and systematic way needed to build a functioning state.

Finally, and not least important, the CPA-scheduled time from the referendum in January 2011 to the declaration of independence in July was only six months, far too limited to make much progress in institution building at par with running an independent state. The timelines in the CPA were non-negotiable for the SPLM, out of fear of losing the referendum and independence altogether.

As we shall see in this chapter, all these challenges implied that South Sudan, come independence, in reality was a country without a state. Two years later its weak institutions were unable to provide a buffer against the implosion that followed the political crisis. It is against this background it is important to analyse what unfolded during the interim period.

The liberation curse: When the ‘rebels’ become the state

Juba, the capital in the South, had always been under government control. During the second civil war (1983–2005) it had deteriorated completely. When I visited the town in 1998 and later it was like a ghost town. The country’s only stretch of tarmac was so potholed that it was difficult to know where the road ended and the ditch began.

On 5 August 2005, only two days before John Garang’s funeral but after 21 years of struggle in the bush, Juba received the liberation hero and chairman of the SPLM/A in a way none had expected, in a coffin. The funeral brought thousands onto the dusty streets, but the atmosphere was tense. Dinka do not traditionally wail over the death of a hero or chief, so awesome silence prevailed.

Akol Maror, an elderly Apuk Dinka, expressed the general feeling: a rope had been pulling them across the river from loony (slavery), Arab domination and massacres. Garang had been holding the rope on the other side. Now he was gone.3 Without him, most thought that peace would not hold.

Immediately after the funeral, the guerrilla army – or liberation movement, as Southern Sudanese preferred to call the SPLM/A – took over Juba. While there had been discussions about a capital elsewhere,4 the leadership had decided to stick with the status quo. After Dr John’s death, and his burial in Juba, that decision became institutionalized.

Unlike elsewhere in Africa, at the onset of the interim period, the liberators inherited a host of problems with few functional institutions. Government entities were mere shells, with dilapidated buildings and a few people shuffling papers inside. Yet there were still thousands on the payroll, another legacy. Regular pay for doing little or nothing had kept some people from joining the ‘rebels’.

During the years of colonial rule and subsequent Khartoum regimes, services hardly existed. Development indicators were among the worst in the world, whether of health, infant mortality, maternal mortality, drinking water and sanitation, or food security. This construction of underdevelopment, to quote Edward Thomas,5 had a serious impact on Southern Sudanese. Such education, as the World Bank reported, had been a tool to coercively assimilate Southerners into Arab and Muslim culture.6

The SPLA quickly swapped their uniforms for dark suits, whether for government offices or the Legislative Assembly. Having spent most of their adult lives in the bush, fighting, however, many had become accustomed to one way of thinking and operating; Southern Sudan was a deeply militarized society. But it was now time for change. At least, that was what we all thought.

Liberation rule

Although the CPA was a result of painfully crafted compromises, not military victory, the SPLA won the credit. They were, in their own eyes, and in the eyes of many people, victors, liberators, heroes.

Unifying the country was a major challenge, as many communities had been isolated from each other and the outside world, uprooted and displaced, often multiple times, during decades of war. Traditional institutions and coping mechanisms had been weakened.

The transition of the SPLM/A from liberation movement to government of Southern Sudan would never be easy. Civilian administration would be merged with government structures of the past, whether in Khartoum or in areas already under SPLM/A control. The SPLA itself was supposed to become a conventional army, while the Movement (the SPLM) should evolve into a political party with a democratic role.

Christopher Clapham’s outline of legacies of liberation in African countries where liberators subsequently attained political power provides a useful template for analysis of South Sudan.7

Victorious movements inherit a powerful sense of legitimacy. As Clapham says,8 they comprise people prepared to sacrifice their lives for a cause, and who come to power with an abiding memory of martyrs. They believe that with independence they have earned the right to run the government. They find it hard to recognize others’ right to govern, instead imbuing their own sacrifices with a virtually permanent and exclusive claim on state power. With this sense of legitimacy, actual performance in government becomes less important, and might even be irrelevant. In some cases, when the hegemony of the liberators is threatened, repression as a means of maintaining power may even be legitimized, relying on state power.

Liberation movements are seldom monolithic. A common feature is the contest for ‘movement hegemony’, frequently with fighting between rivals or factions. This has been the case also during the SPLM’s history, as we have seen. These splits may affect governance after the liberators take over the state, since they may reflect differences, for example on the basis of ethnicity, that could be interpreted as bringing one group to power over others. What from the viewpoint of the winners is presented as ‘national’ liberation may not look that way from the viewpoint of other elements in the population.9 Also here there are parallels to the SPLM, with a competition for power and hegemony which would prove so disastrous in later years.

Furthermore, to be able to manage the difficult transition to government, Clapham points out that self-transformation is necessary. A liberation war has a single clear goal that calls for unity, commitment, discipline and a hierarchal structure of command; running a government is a complicated exercise with multiple and competing goals and requires consensus-building in setting agendas and identifying priorities. Indeed, demolishing a bridge is a lot easier than building one. In this regard, an effective bureaucracy is critical. In addition, differences among pragmatists, power seekers and ideologues, as well as rivalries between the ‘ins’, who have gained important positions, and the ‘outs’, who have not, greatly complicate necessary transformation.10 This was the case also for Southern Sudan.

Finally, liberators seldom recognize internal splits and domestic opposition as signals that they have outstayed their welcome, treating them instead as challenges to the rightful order. Yet credit for liberation is finite, and the moment inevitably arrives when a regime is judged not by its promises but by its performance. Luka Biong Deng, a senior SPLM politician and former minister in the GoSS, has applied these characteristics of the ‘curse’ of liberation.11 Many of them can be seen in successive governments controlled or dominated by the SPLM since the signing of the CPA. Old tensions were fuelling new divisions in the leadership, eventually leading to the crisis in 2013.

Guerrilla Government

Edward Thomas and Cherri Leonardi use the term ‘state capture’ when referring to the SPLM’s sense of entitlement to govern.12 The SPLM’s policy reforms of the late 1990s, described in Øystein Rolandsen’s book Guerrilla Government,13 and converging in the agenda for ‘Peace through Development’,14 were a start. But it was only with the SPLM Strategic Framework: For War-to-Peace Transition, published in August 2004, that the SPLM outlined this complex transition process.15 The document, clearly bearing the hallmark of Chairman John Garang, was particularly detailed on the governance arrangements of the transition and in outlining decentralized and community-oriented development plans, setting a different course from the legacies of liberation. But it was less specific on the transformation of the SPLA into a professional army.

The SPLM/A’s transformation programme committed to a ‘social contract’ defining relations between the people and their government as based on justice, accountability, inclusiveness, responsibility and openness.16 Government would have ‘working rules of collective action, where the institutions of Southern Sudan were seen as a summation of positive elements of social values, traditions and beliefs of all its peoples’.17 The SPLM/A thus departed from the notion that state-building starts ‘from scratch’. It envisioned a decentralized system:

The aim is a community-driven development paradigm that emphasizes and promotes the concept of taking towns and services to people in rural areas, where 98% of our people live, instead of the conventional development paradigm that results in attracting rural people to towns and trapping them in slums with consequent reduced quality of life. This will be an SPLM contribution to development economics.18

The SPLM/A did not want to replicate Khartoum’s marginalizing of peripheries. Righting the wrongs of the past would necessarily involve social transformation. At the same time, the experience of administering liberated areas during the civil war was not the same as running an inclusive government. Governance structures were entirely different; strong institutions, transparency and accountability, central to effective civilian government, were beyond the scope of a liberation movement.

While progress was uneven in institutional development, it was almost non-existent in healing a society broken from decades of civil war and underdevelopment. Southern Sudan’s would-be liberators were unable, in the course of their long struggle, to re-think relations between state and society. Military credentials and rank would often be more decisive than political competence and technical skills when allocating ministerial positions. Influence in decision making was often more determined by the prominence of the past than the competence of the present. And in the absence of alternatives, they ended up structuring relations between the state and the citizens more around traditional roles from the liberation struggle and ethnic representation.19

There is always a danger that former liberators will become complacent beneficiaries of state power.20 The clearest sign of this is the tendency to resort to ethnicity and patronage as the primary governing framework. This can sow the seeds of ethnic divisions going forward. In the Southern Sudanese case the sense of entitlement also led to monopolization of economic benefits through corruption. A decade after the CPA we note that the SPLM’s ambitious transformation programmes were never implemented. It was not easy to shed the uniform. In what follows we will provide some of the reasons.

Tangible benefits and services for the people, particularly in the first year or so after a conflict, are among the most important factors for sustaining peace.21 In 2005 I repeatedly reminded Dr John himself, other SPLM/A leaders, and donors about this. It was important to get it right from the outset. Aware of the challenges, I had proposed establishment – several months before the signing of the CPA – of a trust fund. The Capacity Building Trust Fund (CBTF) was meant to assist in transforming the SPLM/A into a civilian administration, establishing the nascent government of Southern Sudan, assisting with some recurrent costs in the ‘pre-interim’ period, and funding early peace dividends. The CBTF would thus be an interim financing mechanism until the Multi-Donor Trust Fund (MDTF) administered by the World Bank started to disburse funds.

UNICEF had been in charge of the main aid operation, Operation Lifeline Sudan, during the civil war, and was the organization best positioned to host the trust fund during the transition. A few donors put money in, but not much, and certainly not enough. The Trust Fund was therefore not used as intended to help address critical start-up problems. That it became essential in dealing with payroll and other problems in service-delivery ministries later showed that it could have been used in a much better way from the outset.

The World Bank’s MDTF, which received a major part of donor funds in the absence of governmental financial-management capacity, did not help matters. The World Bank’s rules and regulations are not adapted to fragile states, leading to apparent paralysis of the MDTF. Between 2005 and 2008, the MDTF spent only $264 million, mostly towards the end of this period. In other words, it failed to function for several years.22 This made even more critical the assistance of bilateral donors and the UN, which, however, were also dilatory. Bilateral donors came late, and with programmes operated largely by contractors or inexperienced short-term contracted staff. UN agencies’ programmes were inadequately funded and skewed towards humanitarian assistance. Donors’ priorities were now in Darfur and elsewhere.

In April 2005 I had hosted an international donors’ conference in Oslo, at which $4.6 billion was committed. The international community did not deliver as promised. The consequence of the delay was that basic services the population had received in the past – food, health services, education – were cut back rather than increased with the advent of peace.23 As late as 2009, in Juba, when one mentioned ‘the road’, everyone knew what was meant because only one was paved. Observers, me included, who witnessed the missed opportunity of providing early peace dividends, feared that this failure would contribute to rapid destabilization. Two or three years was too long to wait for visible progress.

‘It is our turn to eat’24

At first, there were delays in transferring oil income, and disputes between the Government of National Unity in Khartoum and the Southerners. Disagreements over amounts and transfer arrangements were sorted out over time, and eventually payments came regularly, in the correct amounts and in US dollars.

But the Juba Government had no financial institutions to speak of. During the ‘pre-interim’ period of early 2005, cash was shipped in boxes, and not to the government, which had not been established yet, but to the SPLM offices in Juba. I visited party headquarters at this time, a dilapidated building with no sign that anyone was in charge. This was the SPLM Secretariat of Finance. When oil transfers began there was only a nominal Ministry of Finance there.

The Central Bank, a national institution headquartered in Khartoum, had only a small office in Juba. There were no credible commercial banks beyond those operating in dinars and Islamic banks under Khartoum’s auspices. The first bank branches were established with the help of UNMIS.25 With credit cards unusable, most of the economy was cash-driven throughout the interim period and even after independence.

It was this situation that the CBTF had been established to address. But a transfer from Khartoum, reportedly of $60 million, intended to help the SPLM/A to establish a government, went missing. No investigation was ever conducted.26

The World Bank reported two years later that the:

former SPLM Secretariat of Finance, which managed resources of around $100,000, has transformed itself into a Ministry responsible for managing over one and a half billion dollars annually, including significant external financing.27

The report went on to aver that the government had committed to establishing sound and transparent financial management systems and to combating corruption; some progress had been made, but government finances were still characterized by weak management and lack of accountability. It is surprising that the World Bank, the IMF – and bilateral donors for that matter – raised no alarms. There was no way the former liberators could be capable of managing such amounts at this juncture. And there were other options, as we shall see later.28

But capacity gaps proved to be secondary constraints. The more important factor, it appeared, was absence of political will.29 The oil money was seen not only as a blessing but also as an entitlement. The liberators had been cheated by Khartoum of what they regarded as Southern oil resources for all these years. It was time to be rewarded.

Norway had experienced SPLM/A cadres’ lack of fiscal discipline, having witnessed mismanagement and corruption in a project supposedly supervised by the Movement. Interestingly, characters charged with the accounts and books of the SPLM/A, operating in secrecy, and with little disclosure about what went where and to whom, would later become finance ministers. As one senior SPLM member put it: ‘When leopards are assigned the responsibilities of shepherds, the flock stands no chance.’30

In mid February 2005, I raised this issue with John Garang. I had just come from Rumbek having met the deputy chairman, Salva Kiir, and the rest of the SPLM/A leadership, and I now proceeded to see the boss, who was at the location New Site, where the SPLM/A had one of their headquarters, on other business. I pointed to other African countries where petroleum had become a curse rather than a blessing, and where corruption had become a cancer undermining development and destroying fragile institutions. The SPLM/A and its leaders were at great risk of developing the same habits, I told the chairman, unless the process was checked at the outset. It was critical to establish mechanisms of control and oversight, making corruption more difficult; otherwise it would destroy everything they had fought for.

I had sensitive information to share with Dr John. Norway, an important oil producer, always followed developments in the petroleum business, and we knew that individuals in the SPLM/A had done deals with oil companies without the chairman’s knowledge. How significant these were we did not know, but the documentary evidence we had contained licences in blocks that were meant for new Southern Sudanese companies. Later it appeared that still others had engaged in telecom deals, and other contracts, pending the signing of the CPA.

The chairman expressed no surprise. He said he knew something was going on. Though concerned, he said that deals undertaken during the pre-interim period, prior to establishment of the government of Southern Sudan, would be illegal the minute legislation was passed. In the event, however, it took many years to enact the necessary laws, probably because the very cadres who had made the underhanded deals did their utmost to procrastinate.

Bad habits die hard

This was hardly the chairman’s first encounter with corruption. Peter Adwok Nyaba, an SPLM minister in the Government of National Unity and in South Sudan, had in 1996 published an account of how food rations during the early days of the struggle were misappropriated and sold in Ethiopia, contributing to deaths by disease and starvation.31

During the civil war, unpaid soldiers had to rely on help from local people, scrounging food in the bush, looting, and when in trouble, stealing and finding other ways to support operations and feed their families. Looting food aid was an aspect of military strategy during the 1990s, when SPLM/A factions were fighting each other.32 SPLA bases were sited near refugee camps or where humanitarian operations distributed food.33 Some cadres managed to get their hands on other resources. Bad habits had thus already developed among the liberators.34

Corruption was a hot topic at the famous commanders’ meeting at Rumbek in late November 2004, when Salva Kiir opposed Garang:

Corruption, as a result of the lack of structures, has created a lack of accountability which has reached a proportion that will be difficult to eradicate.35

Reverting to this issue later in the discussion, he said:

I would also like to say something about rampant corruption in the Movement. At the moment some members of the Movement have formed private companies, bought houses and have huge bank accounts in foreign countries. I wonder what kind of system are we going to establish in South Sudan considering ourselves indulged in this respect?36

Dr John did not comment on these allegations directly, and others present criticized complacency in this regard. And corruption was but one of 13 problems Cdr James Wani Igga listed:

Problem 8: Corruption which remains rampant in the Movement. Corruption must be fought […] some years back the Chairman in a meeting informed us that Cdr. Deng Alor brought some money from Nigeria, but how that money was spent had never been explained to us again. I ask the question where is the transparency and accountability we talked about?37

And interestingly, he added: ‘Let’s avoid “Kitchen Cabinets” and combat corruption.’38

Dr John did not dispute some of these charges in his conversations with me. He agreed that it was very important to establish robust systems of financial control, particularly for the petroleum sector, contracts and financial transfers. I proposed a series of measures, based on best practice internationally, to combat the problem.

One creative idea was to establish a mechanism to hold back some oil income until adequate financial institutions and controls were in place. Access to funds would happen with special permission and through periodic transfers, with transparency and necessary controls. International accounting companies could host such funds ad interim. Dr John was open to such ideas. We agreed to explore them further, when he would be in Khartoum in July for his inauguration. But before it was possible to get any further, he died.

That the CPA did not address this explicitly was the responsibility of the parties. Early on the SPLM/A raised the issue of an ‘offshore account’ under the custody of international experts to ensure that both parties got their fair shares of the oil income. Sudan rejected the idea outright on the basis of national sovereignty. Bilateral offers to the SPLM/A on revenue management in 2002 were not taken up. While there was pressure in the wealth-sharing talks to ensure best practice in financial management, the World Bank was slow in establishing advisory capacity in Juba. Although constrained by the fact that Southern Sudan was not yet a shareholder, the IMF and World Bank could have done more. Donors could also have put more pressure on the Southerners to establish a transitional financial mechanism in 2005. Whether there would ever have been political will was a question never answered.

After my political party in Norway lost elections in September 2005, I left office as minister for international development. Before my departure, I mentioned the importance of pursuing this issue with SPLM/A leaders. While several countries and institutions funded advisers to the ministries of finance and petroleum during this period, management of the oil revenues itself needed a stronger and separate mechanism.

The Southern Sudanese inherited mismanagement and corruption from the pre-CPA system – Khartoum’s and the SPLM/A’s. That system had resulted from the war and its political economy, and from the tendency to use access to state resources to accumulate private wealth, a habit in Sudan that carried over into the Southern Government. With no institutions, financial management in Southern Sudan relied on personal honesty, clearly an unsustainable basis in a post-conflict situation. The international community therefore shares responsibility for the problems that ensued.

Many in the Movement regarded the CPA as only a ceasefire. They believed that Khartoum would never allow self-determination, and that they would be going back to the bush to continue the fight. The death of the chairman probably strengthened this expectation. Meanwhile they might as well take what they could get before fighting resumed.

A story that President Museveni told me about the mentality of liberation movements illustrates the point. When you go hunting, he said, and make a catch, you skin the animal, gather around the fire, and wait for the meat. One cannot tell the hunter to go home hungry. Expecting them to leave office before eating the meal was naive.

In a number of languages, including Swahili and Arabic, the term for stealing or corruption is ‘eating’, not only in relation to money, but also in reference to land and other resources. Alfred Lokuji of Juba University puts it this way: ‘only the SPLM/A leaders appear to have full rights to the dividends of peace.’39

Salva Kiir, taking over after the death of Garang, soon discovered that running a government was different from administering SPLM/A-controlled areas in ‘New Sudan’. Southern Sudanese had often joked about the corruption in Khartoum, claiming that they would not make the same mistakes. However, once in office they soon found their fingers deep in the same coffers. Salva Kiir now had to address the corruption he had long complained about.

Nascent state-building

At the same time, the interim-period Government of Southern Sudan started off with a significant financial burden. Khartoum had paid for salaries, but not for much else. Many people on the government payroll sat around doing nothing, constituting a financial burden and political ‘hot potato’. Payroll clean-up was thus controversial, not only from the perspective of old beneficiaries, but soon also for government officials quickly recruiting their own people, whose salaries lubricated patronage networks.40 The Government’s budget in 2005 was $14.5 million; in 2006 it budgeted $1.34 billion and spent $1.56 billion.

Southern Sudan during the interim period had more income than most post-conflict countries, owing to its oil revenue. Its share was 50 per cent of net revenue from oil wells located in Southern Sudan. A significant shortfall was recorded – according to audits, about $430 million between 2005 and 200841 – but subsequently the GoSS regularly received its share. Southern Sudan was entirely oil-dependent, however, with some 98 per cent of its income from oil, and little effort was made to develop non-oil revenue. What was missing was a functioning government.

Donors supported capacity-development programmes and some did well in selected sectors. Despite elaborate plans in some ministries, however, such assistance was not provided in the systematic and coherent way needed to establish a strong foundation of the state. Aid continued to be dominated by humanitarian assistance even until the onset of the crisis of 2013, when 43 per cent went for emergency assistance. Even for countries such as Afghanistan, the Central African Republic and Iraq, much more aid was for longer-term development assistance.42 Whether this was related to the long history of humanitarian operations in Southern Sudan or a matter of donor priorities is not easy to tell.

Another challenge was that some important capacity-building programmes had to wait, because of the CPA requirement to ‘make unity attractive’. The outcome of the referendum could not be taken for granted. Government institutions in such fields as the Central Bank, immigration, customs and border control, civil aviation and intelligence could not be established before it was clear that Southern Sudan would become independent.

Between 2005 and the referendum in January 2011, United Nations agencies, funds and programmes, and its peacekeeping mission, UNMIS, as well as bilateral donors worried about seeming to pre-judge the outcome. Khartoum, and especially the ruling party, the NCP, deplored anything resembling support for sovereign institutions, and would immediately react when programmes could be interpreted as providing it. They were cautious.

Most donors supported capacity building programmes with consultants, either embedded in ministries or flying in and out, in public financial management, decentralization and the like. But there was no comprehensive programme covering the core functions of the state. Many countries in the region provided courses in foreign affairs, security and other areas, mostly focusing on individual training. We knew this would not add up to what was needed. Courses seldom teach the ‘trade’ of running a government and a civil service, which is best done on site and through embedded experts. Institution-building requires a different approach and it takes a long time.

Without a bureaucracy to translate policies and plans into action, massive investment was needed to build government capacity. Early on, when in the African Development Bank, I tried to convince the Southern Sudanese to take on a large-scale secondment programme on the model of post-conflict Mozambique. That country had benefited from a large number of foreign experts from Lusophone countries imbedded in ministries under national leadership. The successful programme had lasted for more than ten years and seemed a possible way forward now.43 But scepticism about ‘foreigners’ working alongside Southern Sudanese counterparts precluded such a step. Some members of the GoSS and SPLM leadership seemed to think they could manage on their own, traits we would see more of after independence. More importantly, foreigners could see too much and interfere with dubious practices.

Neighbouring countries did offer to send experts, and second teams of experts,44 and to assist with reforms. Delegations were sent to Juba again and again, and agreements were reached during visits to the respective countries. But little happened. I met frustrated heads of governments and ministers of a number of countries in Africa who had had several meetings with Southern Sudanese counterparts about this, and such contacts continued after independence. They told me that the Southern Sudanese leaders always agreed, but hardly ever followed up. In the end, they gave up.

An IGAD programme that did move forward, however, with experts seconded to various government offices, was an exception proving the rule. Administered by the UNDP, not the government, and externally funded, by Norway, even this won cabinet approval only with difficulty, as sceptical ministers did not want foreigners in their offices: they would handle capacity-building themselves. The President had to intervene before the programme could go forward.45

One does not know what one does not know, and particularly if one has never been part of a functional government. If one has not worked in institutions with well-established legal and regulatory frameworks and civil servants implementing policies according to instructions, rules and regulations, budgets, mandates, and in a transparent way, one cannot know how big the gaps are in one’s own institutions. And if the only point of comparison was Khartoum, or liberated areas administered through the SPLM/A’s Civil Authority of New Sudan during the war, there were big gaps indeed.46 But as one senior SPLM official said with a big grin, some people do not want to be shown what they do not know.47

Liberators are not peace-builders

Christopher Clapham points out tensions that often build up between an old bureaucracy and the liberators, when the latter want to run the show. In Southern Sudan, this pitted Southerners who had been civil servants in the North, some of them very competent, against cadres from the SPLM/A. But that alone does not account for lack of follow-through with African countries’ or donors’ offers of help. There were other reasons. Pride was a trait outsiders often interpreted as arrogance. This was even more prominent after independence. I suspected also that an international presence within ministries, even during the interim period, would have made nepotism, patronage and corruption more difficult to conceal.

After three or four years, in any case, some physical and organizational infrastructure was finally in place at the GoSS level and, to a lesser degree, at the state level. The central Government at Juba worked somehow, with planning and budgeting systems facilitating decision making processes, but without essential legislation and policy frameworks in key areas. Bureaucratic systems and processes were set up, but were ineffective and faulty; management of financial resources was the worst. The Ministry of Finance and Economic Planning (MOFEP) was characterized by very weak capacity and undeveloped structures, with directors formally appointed only in July 2006. As in most ministries, there were no appointments below the Assistant Director level: staff were paid but not formally appointed.48

Five years into the interim period, in 2010, half of the statutory positions in the ministries of the GoSS remained unfilled. Whether this was related to lack of qualified personnel or lack of recruitment capacity, is not clear. Only 5 per cent of employees had a graduate degree. Fifty per cent had only primary education, with a significant number literate primarily in Arabic, and not English – even though the latter for political reasons had been chosen as the national language of the South and the official language of the government.49

Lack of infrastructure, information systems and equipment made matters worse. Government structures were largely absent outside Juba, and despite rhetoric about decentralization, not much was done to empower the second and third tiers. As in Khartoum, resources and decision making were concentrated in the capital, with limited powers delegated below, little capacity built, and few services delivered.

As James Copnall points out,50 the weakness of the ten states’ governments today is structural, replicating that of the national government: just as the latter’s revenue comes almost entirely from oil, the states’ is from Juba. Such transfers were unreliable.

Lessons learned by other liberation movements were not applied. John Garang’s vision of ‘bringing the towns to the people’ (in ideological opposition to Khartoum’s centralization) was never realized. Nor was his other vision to invest massively in agriculture in a country where 90 per cent of the land is arable, benefiting the largely rural population.51

Although capacity was built in a number of areas, much more would have been achieved if a strategic, systematic approach had been adopted and resources had been controlled and wisely spent. Both donors and liberators must account for the absence of comprehensive development of the core functions of the state during the interim period. Once the referendum was held and independence was only six months away, there was too little time to complete the job. In hindsight, more should probably have been done to convince Southern Sudanese of the need for time for preparations during that phase. It could have prepared them better.

In key areas, legislation was not passed and institutions were kept weak for political reasons, making transparency and accountability more difficult. One area was financial management, where institutional gaps, legislation and regulatory frameworks remained unaddressed. Almost any attempt at tightening financial controls was delayed or shelved. While foreign donors and international financial institutions could have made a decisive coordinated effort to establish robust management, the complacency and delays of the Southern Sudanese seemed quite deliberate. Financial institutions and contractual arrangements that were weak and opaque made it easier to misappropriate funds.

Throughout the interim period the GoSS operated without statutory guidelines in public financial management, revenue management, including management of oil income, audit, procurement and the public service. Without legislation and basic regulations, there was basically a free-for-all. Even adherence to the Appropriations Act of 2007 was problematic; there was no multi-year expenditure framework. Before independence, there was not even a functioning auditor-general’s office: audits for the interim period were issued only after independence.

The only experience any minister had of government institutions and their financial operations was in Khartoum. While in bureaucratic procedures and government decision making those systems were not bad, institutions were weak and operations questionable.52 In Khartoum a tiny elite made political decisions behind closed doors.53 This experience and the SPLM/A tradition of administration in liberated areas were not a basis for good governance.

With no credible institutions and systems of governance, and when productive systems failed to provide sustainable livelihoods, what remained were handouts, at multiple levels. Ethnicity became the organizing principle. To cater for patronage responsibilities, transparency and accountability were not priorities. And in Southern Sudan there was money to grab from the oil revenue, which to uninformed comrades, seemed likely to last forever.

The oil curse: Entitlement in dollars

The oil curse has afflicted most oil-producing countries, creating both a culture of corruption and a culture of overspending, often leading to the so-called Dutch disease (an overheated economy with major macro-economic imbalances). However, one important point must be made at the outset; without oil production and the income expected from it, South Sudan would not have been seen as a viable state. Prospects of international support for self-determination (and subsequently independence) might have been dim. A viable economy is generally considered a precondition for self-government. For the SPLM/A and Southern Sudanese, therefore, oil was initially a real blessing. When analysing the ‘curse’, this needs to be acknowledged.

Corruption manifested itself in several ways. We have already seen how the SPLM’s Secretariat of Finance was handling an exponential increase in revenue.54 It is no wonder that there were problems; the liberators could happily reap the fruits of their struggle, without any controls or accountability. Secondly, in a heavily militarized society the lion’s share of the budget went to security. Salaries and contracts were most corruption-prone. Under the radar, SPLA commanders influenced the economy through an informal network of closely held companies and contracts. The flawed procurement system was never fixed; legislation and regulatory procedures were stalled, allowing massive corruption in connection with contracts. Suppliers associated with the liberators and elites won contracts without any competition. Some contracts involved leasing large areas of land to foreign companies.55

Infrastructure is prone to corrupt practices worldwide, not only in airports, but also roads, electricity, water and other construction projects. The same goes for the defence and petroleum sectors. Kickbacks and ‘cuts’ are often easy to arrange when contracts are negotiated. Southern Sudan was no exception.

President Kiir knew what was going on, and soon encountered major problems. Overspending was rampant during the first years, with a total lack of fiscal discipline. Planned investments in roads, schools, clinics and so on were squeezed out by the burgeoning payroll.56 There was already an exponential increase in organized forces (SPLA, police, prison guards, wildlife wardens and war veterans), constituting about 80 per cent of government personnel.57 Kiir dismissed his first minister of finance and a number of officials on corruption charges after only a year, disciplined several ministers, and tried with international help to establish a more robust financial system. It soon became clear that most in the leadership of the government in Juba, the army, and the SPLM itself expected to ‘eat’, one way or another. Kiir seemed to fear that rocking the boat would threaten the unity of Southerners before the all-important referendum.

For Southern Sudanese appointed to the Government of National Unity in Khartoum it was more difficult to engage in corruption because they were under scrutiny by Northern counterparts. But some there, notably in the Ministry of Petroleum or in positions related to national security had easy access to substantial amounts of cash58 and to money-making opportunities connected to state contracts.59

One area involved telecom companies. Some cadres got involved very early in mobile-phone licensing, and some acquired significant holdings in companies. The first mobile phone company in the South was Gemtel, which registered in 2004 and began operations (without Khartoum’s approval) in 2005. The main reason for its establishment was to avoid Khartoum’s monitoring of Southerners’ communications. The shareholders included leading commanders in the SPLM/A and a Ugandan investor, who put up most of the capital. Gemtel soon became profitable, and was sold, controversially, to Libyan interests in 2006. Speculation about the sale price, the beneficial shareholders (one of whom, a prominent SPLM politician, was rumoured to have got the biggest share of the massive profits) and kickbacks has continued with deleterious effect until today.60

Vivacell, another Southern Sudanese mobile-phone company, resulted from an agreement between a Lebanese investor, with a 75 per cent share, and SPLM cadres (with a 25 per cent share paid from unknown sources) through a party-owned company called Wawad Ltd. The party was also rumoured to be involved, presumably to generate profits. But Wawad also had shares in Imatong Gas, which operated in the oil industry, New Insurance Company, and other enterprises.61 Both Gemtel and Vivacell were granted tax exemptions not extended to competitors.62

If, as rumoured, the SPLM put up some of the Vivacell’s initial capital, shareholder dividends should have appeared in the party accounts. The company is reported to have generated monthly revenue of $90–180 million;63 even the lower figure translating to more than $200 million in profits in a year. Sources with access to the books state that nothing of the kind appeared in the government’s or SPLM’s accounts. This issue was included in investigations into the party coffers in 2013.64 Some money from Vivacell allegedly still continues to go to a senior party official.65

Such practices were hardly alien to the national Sudanese scene, where corruption was a significant long-term problem. Institutions still functioned somehow in Khartoum; economic mismanagement and total lack of financial controls, as evidenced in numerous audits, had a much more serious impact in the south.66 Building state institutions while their financial basis is being eaten away and their staff are involved in illicit activities is extremely difficult. As late as 2010, observers waiting for a meeting with a senior official at the President’s Office in Juba saw big cardboard boxes, stacked with bundles of US dollars, being delivered.67 Even making allowances for a cash-based economy, the absence of a paper trail make it very likely that this money was never properly booked.

Doling out large amounts of cash was a practice in Khartoum, too, where high-level government officials regularly did so from their offices.68 Stories circulated widely of money changing hands between staff at the presidency and visitors. Well-wishers’ leaving cash at the President’s Office in Juba was likewise not uncommon.69

During the interim period, one minister of finance, on his last day in office, was observed in the VIP lounge of Juba airport with seven black brief cases as hand luggage, waiting for a flight.70 One could only guess the contents.

From the horse’s mouth: South Sudan’s audits

During the period 2005–11, some $12 billion in oil revenue was reportedly transferred to Southern Sudan.71 Detailed monthly oil reports indicated some level of transparency. A similar picture of expenditure has not been available. As we shall see, President Kiir estimated the gap between income and expenditure at $4 billion, a figure Copnall considers possibly too low.72 Clearly a huge amount of money was unaccounted for. This does not mean it was all stolen. There is no doubt, however, that vast sums were misappropriated one way or another.

The best source for studying this development is the Audit Chamber. Under the professional and courageous leadership of Auditor General Stephen Wondu the chamber produced impressive, transparent and straightforward reports. In statements for the fiscal years 2005–8,73 procedural mishaps, massive overspending, gaping holes in accounting and amazing misappropriation were revealed. Hundreds of millions of dollars were unaccounted for. For 2005–6, for example, oil revenue transfers were reported as over $580 million, while the financial statement recognized receipt of $704 million.74

What many regard as the first major case of GoSS corruption involved the Aweil-Miriam road project in Northern Bahr el Ghazal. Some $12 million was paid out for construction, while another $68 million was ‘earmarked for road construction’ and loans of $288 million were reportedly guaranteed for road works in the same state.75 The Legislative Assembly authorized no such extra-budgetary appropriation, and the Minister of Roads and Transport denies all knowledge of the project.76 Whatever the case may be, to date no one has seen the road.

In the same fiscal year 2005–6, more than $120 million was spent on purchases of vehicles, with absolutely no records. Fifteen government institutions, accounting for more than 80 per cent (or $440 million) of total payroll, could not present any records of their staff.77

The Auditor General actually dared to suggest what such sums meant to his poor country. More than $114 million missing from the GoSS financial statements for 2007 would have been enough to import 3,800 heavy tractors, significantly reducing or even eliminating dependence on imported food, alleviating rural poverty and generating additional revenue for local and state governments.78 The Ministry of Education, for its part, granted itself a novel ‘weekend allowance’ that could have paid the salaries of 855 teachers.79

Even the detailed monthly oil reports were subject, in the Audit Chamber’s terms, to ‘creative’ accounting.80 The chamber complained that accounts and records on oil production and revenue were inaccessible, making it impossible to report on the credibility of records upstream, or the sales downstream, including invoicing and payment details.81 In what was to be a repetitive complaint, the Audit found no evidence that the Ministry of Finance and Economic Planning based its release of funds on approved budget lines. There was indeed no way to affirm that the financial affairs of the country were conducted in accordance with the Appropriations Act of 2007, one of the few pieces of legislation passed during the interim period.82

The Ministry of Finance received particular attention from the Audit Chamber. In 2006–7 that Ministry could provide documentation for only one-third of its (alleged) employees. Not to be outdone, in 2007–8 the Ministry of Legal Affairs tripled its payroll expenditure every month for four months in a row.83 No explanation was given to auditors. The same thing happened in other ministries, as I later ascertained from relevant documents.84

Accountants elsewhere might be surprised that the Ministry of Finance and Economic Planning was one of the GoSS’s biggest spenders, in 2008 exceeding almost all of its own budget by as much as 400 per cent.85 The Ministry’s purchase of 400 Land Cruisers, without tender,86 was one of the first corruption scandals of the era, and led eventually to the Finance Minister’s demise. As the Audit Chamber points out in numerous damning reports, single sourcing was systematically used in public contracts throughout the interim period.

It was also in 2008 that the so-called Dura Scandal erupted. The Audit of 2008 notes contracts to purchase some $2.3 billion worth of dura (sorghum). Companies unregistered or incapable of delivering the grain were nonetheless awarded contracts.87 Several investigation committees were set up, but not much happened. When international investigations were launched several years later, it became clear that although contracts had been signed, in the majority of cases money had not been transferred. In the end some $250 million had been subject to fraudulent transactions.88

As in 2005/6 and 2007, every report for 2008 issued by the Audit Chamber ends with a telling sentence:

Without the benefit of the review of oil revenue documents (97.5%) of total revenue, without review of substantial records of SPLA pay roll expenditure for the year, and in light of the discrepancies found in the sample tests in my opinion, the financial statements of the Government of Southern Sudan for the year ended 31st December 2008 do not present a true and fair financial position.

It is worth noting that an Anti-Corruption Commission had been toothless from its inception. Attempts to strengthen itself during the interim period, or after independence, whether legislatively or through greater capacity, proved unsuccessful. Whatever the Commission tried, others prevented. Its independent prosecuting authority was actually set out in the Transitional Constitution.89 The Ministry of Justice nevertheless hobbled it, for what reasons we can only speculate. Despite the President’s strong rhetoric, the Commission clearly did not get the teeth necessary to do its job.90

Broken social contract

In 2009 the drop in the world price of oil had serious repercussions in Southern Sudan. When the government tried to mobilize emergency financial assistance from donors, they held back. Most aid was in the form of projects or funds administered by others, and not the Southern Sudanese;91 now the government wanted assistance directly. A so-called Compact between the government and donors was eventually reached, based on mutual accountability, and covering a range of issues.92 By this time, June 2009, as the Dura Scandal hit the headlines, no donors would help without a strong commitment to accountability.

The Government failed to fulfil its promises.93 Several years passed before the necessary legislation was enacted, and even the Dura saga was not dealt with until 2012, when Kosti Manibe Ngai was minister of finance and won the help of the World Bank and UN Office on Drugs and Crime. They investigated, clarified financial implications, and identified the fraud. To date (2015), however, none of the individuals involved have been charged or taken to court.

From the donors’ point of view there were still grave problems within the financial institutions themselves. The sub-office, not a proper Central Bank, managed billions of dollars of oil revenue. With a weak institution and limited transparency, there was a danger that millions could get ‘lost’. Stories circulated privately about Central Bank officials engaging in dubious practices.

Networks within the Ministry of Finance were corrupt, and linked up with accounts sections or payments units in other ministries. People knew whom to approach to get a signature to release funds, or for approval of contracts that were inflated or included kickbacks.94 The security ministries lacked normal accounting procedures and record keeping, avoided transparent registration of personnel (‘the parade’), and had massively inflated payrolls, as we shall see. Some ministers, trying to clean things up, showed me documents indicating the enormity of what was going on.95 Copnall tells us that:

A foreign consultant witnessed a senior official at a ministry receive a brown envelope, count the wedge of cash around three inches thick, and then tell the person who had handed him the envelope ‘That’s fine, you will get the contract on Monday.’96

More recently, in 2014, the South Sudanese presidency threatened punitive action against finance ministry officials who extorted bribes from companies seeking contracts. The media reported alarm at the extent of bribery at the ministry, allegations of widespread delays in payments, kickbacks, and nepotism.97 I had received the same information from confidential sources.

Some suggest that Kosti Manibe’s attempt to break these networks – through switching people in or out of key positions, and moving payment officers from one department to another, led to his suspension as minister of finance in April 2013 on charges of corruption. Others deny this, highlighting his failure to stop a dubious transfer of money by a ministerial colleague as the reason.98

Corruption behind closed doors is one thing. What people observe in town is another. One could see cars worth $150,000 or more – one SPLM leader has at least five. There were watches on display that cost $25,000 or more – one liberator had a $75,000 watch. They showed off smartphones costing hundreds of dollars, and were drinking the most expensive whisky and finest champagne. During the interim period, citizens could not fail to note construction of multi-storey buildings, and residential areas populated by SPLA generals and government officials with their own houses or even with two or three. Some ministers stayed in hotels, at government expense, while renting out their houses.99 Houses rented for outrageous amounts, often as much as $25,000 a month.

Despite Juba’s terrible roads at this time, it probably had more expensive four-wheel or luxury cars than almost anywhere else in East Africa. Flashy cars lined up at the airport, row upon row, including Hummers and the like. The old freedom fighter, Edward Lino, has published a recent example of the South Sudanese elite’s new habits:

I encountered a teenager […] who appeared to belong to one of the newly ‘privileged classes’ driving an elegant leather seated 2012 V8 Balloon (i.e: a Porsche racing car). I heard him asking some of his colleagues about the availability of a 2013 Model to change his ‘outdated’ wind-dropped Balloon.100

Beyond the parking lot the airport itself was a different story. Its rundown buildings were scheduled years ago for replacement by a new international terminal that stands half-finished next to it. Contracts worth some $30–50 million (at conservative estimates) were awarded by the first minister of roads and transport, with successors funding first South African, then Ugandan contractors. But the work was never completed.101 A $158 million loan from a Chinese bank is now supposedly intended to complete the terminal, incurring even more debt for the government.102 A parliamentary enquiry has been launched.

The ring road around Juba is another example. When finally completed, it cost three or four times more per kilometre than the advanced tarmac road constructed by USAID from Uganda to Juba.103 The same company got a number of infrastructure contracts around the capital, reportedly in the order of around $160 million.104 Considering all the money spent across the country over the years, and such meagre results, I used to call the senior official in charge the ‘Minister of No Roads and No Bridges’. As a very senior SPLM member from the early days put it: ‘They built a system like a buffet. Anybody could come and take their dish and go.’105

Patronage expected from people in office should not be underestimated. Transparency International has observed this phenomenon in South Sudan.106 It is true that a ‘big man’ in a ‘big office’ is expected to deliver a lot for his (or – much less often – her) community. Ethnic and clan affiliation leads to expectations of handouts, favours, jobs, contracts, and the rest. Several ministers told me about the pressures. They could set up ‘camp’ outside their office. Also at home 20–30 people would be living in their house at any point in time, expecting cash in hand. There was ‘inflation’ in expectations related to contributions of cattle for bride-wealth and communal events.

While it is expected that a leader should have more than others, and should assist, excessive wealth on display goes way beyond popular imagination. A ‘big man’ does not need $27,000,000 to subsidize his relatives and wider patronage network, but that is how much one SPLM leader held in his Kampala accounts; others reportedly have much more.107 Indeed, credible sources also report that liberators have individual bank accounts or holdings abroad of over $10 million and some up to $100 million or more.108 These fortunes are kept mostly in Kenya and Uganda, but a lot also in London, the US, South Africa, Australia and Switzerland. In Nairobi and Kampala there are many houses owned by South Sudanese in rich neighbourhoods; some look like palaces.109

Unless all of these characters were planning to run for president, and needed to fund election campaigns, they have stolen and salted away much more than any ‘big men’ would need. Alex de Waal has summarized the situation succinctly:

South Sudan obtained independence in July 2011 as a kleptocracy – a militarized, corrupt neo-patrimonial system of governance. By the time of independence, the South Sudanese ‘political marketplace’ was so expensive that the country’s comparatively copious revenue was consumed by the military-political patronage system, with almost nothing left for public services, development and institution building.110

From liberators to big spenders

So while some became fabulously rich, and did nothing to hide it, the results were meagre for ordinary citizens. Peace did not give them food on the table, clinics for their sick, or schools for their children.

As they awaited the ‘peace dividend’, the GoSS budget surged, almost doubling between 2006 and the end of the interim period. At independence, South Sudan had become the biggest spender in the African neighbourhood, close to $350 per capita – three times what Kenya spent, and more than four times as much as Uganda. In 2011 South Sudan overspent its budget by 50 per cent.111

By the time of independence in 2011 the appalling state of budgetary management revealed by the Auditor General should have improved. As the price of oil rebounded after the 2008–9 financial crisis, and despite increased capacity and support, actual budgetary management remained very poor. The World Bank, for example, characterized payroll management and personal accounts as being ‘grossly mismanaged’.112

A major part of the budget was still allocated to the security sector, and most of the expenditure in the ministries went to salaries rather than services. Programmes for the suffering people, whether in education, health or rural livelihood support, were few and largely implemented by external donors, faith-based organizations, or NGOs. By independence not a single inter-state trunk road had been completed. Only 5,000 km of dirt roads had been constructed, and a lot of that by the World Food Programme.113

For the more than 80 per cent of Southern Sudanese who lived in rural areas, what mattered most was security, food, schools, clinics and roads. In numerous speeches, President Kiir claimed that these were among his highest priorities. But numbers alone show the opposite. The budget for the entire education sector was constant throughout the interim period, at about five per cent of the total, with around half going to primary education. This was among the lowest allocations in the world; the average for East Africa was 20 per cent.114 While the number of children enrolled in primary school almost doubled during the first years, this was mostly owed to international support, and from 2009 transfers to education declined and most indicators deteriorated.115 More than half of the children in South Sudan were still out of school, and illiteracy rates were still astoundingly high. Only one-third of the adult population could read and write; in Kenya the number is over 85 per cent.116

In the health sector the situation was worse. After 2006 the amount budgeted actually declined, and since 2010, at 2.1 per cent of the budget, has been among the lowest in the world.117 Donors have funded 70 per cent of the services in the health sector, which was probably the main factor in reducing infant mortality between 2006 and 2010.118 But only one person in ten had access to health services, and the maternal mortality rate was the highest in the world.119 Even now, it is more likely that a teenage girl will die in childbirth than that she will enter grade eight at school, 13–15 years old.120 At independence, almost half the population had no access to clean water and one in five to sanitation.121 Hardly any investment was made in agriculture and livestock, key areas of livelihood and economic development in Southern Sudan.

It seemed clear that SPLM leaders had not delivered on their many promises. Rather than bringing towns and services to the people, ever-more resources were concentrated at the centre.

Illustrative of the challenges was a comment from an ordinary citizen, a driver. I asked how Juba had changed since the CPA. His response was surprising:

Actually, it was better under the Arabs. At least they left us alone – unless we got ourselves into trouble. But the Dinkas, they don’t respect us, they abuse us, use rude language, and take our land.

To him the Dinka appeared foreigners too, not Southern Sudanese brothers. He was not alone. Similar language would be used against Equatorians; Juba was alien territory even for many SPLM and SPLA cadres and government officials of Nilotic origin, many of whom never felt welcome in their own capital. Such feelings, on both sides, would later fuel ethnic tensions.

The Sudanese state had been a disturbing element extracting resources from the peripheries rather than providing services. A Nuer description of government is ‘a group of people who have decided to come together to eat on behalf of the people’.122 But the liberators appeared to continue in the footsteps of Khartoum. Instead of changing the political order, the new centre, Juba, monopolized financial resources and the towns got most of the services.123 Figures from the interim period suggest that South Sudan compared unfavourably even with Sudan when it came to concentration of national wealth.124

South Sudan became a highly centralized state, an unintended consequence of greed, short-sightedness, inexperience in government, and lack of commitment to build the capacity necessary to do better. According to Thomas, under SPLM’s leadership:

the national capital [in many respects] relates to rural South Sudan in a manner that many ordinary people compare to Khartoum.125

The new contract between state and citizen reflected in the SPLM’s transition strategy126 was never implemented.

Independence: Time for delivery

Frustrated SPLM cadres counted on independence to set a new course. To prepare for independence, in 2010 the government started the GOSS Priority Core Functions programme focusing on the main areas of state responsibility regardless of the referendum’s outcome. After consultations across ministries, and coordinated by a competent team at the undersecretary level, 6 priority areas and 19 core functions were identified as most urgent. The priority areas were executive leadership, the security sector, rule of law and rule enforcement, fiduciary management, public administration and management of natural resources.

An Action Plan was launched in September 2010 and presented to donors at a high-level meeting in Brussels.127 Together with the UN, World Bank and other donors, bilateral and multilateral, support programmes were identified and committed to. Some were already under way, others commenced, to build institutional capacity prior to independence.

The plan was intended to make sure that the process was completed in a timely manner. After the result of the referendum was clear, there would be only six months left before independence. The GoSS would have to focus on the most urgent short-term priorities, which were identified as ‘executive peer learning’, legislation (linked to independence), police training, customs, currency, the oil sector and oil revenue. Work had started in these areas, but time was short.

The whole process was managed by the Southern Sudan 2011 Task Force chaired by Vice President Riek Machar, which would oversee the building of institutions for state ‘take-off’ and preparations for Independence Day celebrations, as well as supervise negotiations over secession. It met weekly and almost became a parallel cabinet, and in doing so epitomized the widening rift between the two most senior SPLM figures Salva Kiir and Riek Machar.

The Core Functions programme was to be followed by a grandiose South Sudan Development Plan (2011–13), supported by a revised GoSS Aid Strategy. These were intended to address medium-term needs in the post-independence period, and involved elaborate programmes developed by the different ‘pillars’ (clusters of sectors) of the Government of South Sudan, with consultations in all ten states as well as with the Legislative Assembly.

The South Sudan Development Plan was a massive 400 pages.128 Main priorities were identified as improving governance, achieving rapid rural transformation, improving and expanding education and health services, and deepening peace-building and improving security. The plan had baselines, targets, indicators per sector, and a monitoring framework. It would involve a herculean effort. But with the limited capacity of the Southern Sudanese administration and no cost estimates or public expenditure framework, a major question was whether the plan was at all realistic.

Observers might be surprised that the GoSS decided to conduct a self-assessment during the interim period. This was a SPLM initiative, entirely homegrown, funded from government coffers, conducted by Southern Sudanese researchers, and led by a ministerial committee collaborating with relevant local networks, think tanks and academics. Substantial resources were devoted to this effort, and the results were impressive.

The in-depth evaluation highlighted gaps that most of us long-term observers had noted, and identified dysfunction and deficiencies critically in need of correction. It addressed weaknesses in the executive, including the presidency, the ministries and directorates. It highlighted problems at the national, state and county levels, and the National Legislature. It provided a number of bold recommendations, even including restructuring the cabinet and presidency.

This truly unique product, completed only in the first quarter of 2012 (with the help of Priscilla Nyandeng Kuch, a deputy minister), was duly circulated, with strict confidentiality, to key SPLM leaders. As SRSG I was briefed, and I repeatedly pushed for the report to be deliberated at the highest levels in the cabinet and the SPLM, suggesting that a retreat discuss the findings. The report was eventually ignored, in part because of increasing tensions within the leadership.

What were the perceptions of the people? More than 2,000 were interviewed in all parts of the country in 2011, prior to independence.129 Their responses were unsurprising. The top concern was hunger. Insecurity and health were seen as major problems, followed by education. Corruption was listed as a problem, but not in relation to mere survival. Stories of corruption had been rife on the streets of Juba, but people had given the SPLM the benefit of the doubt. They blamed Khartoum. And they still had hope that independence would change things.

Independence

When President Bashir visited Juba on 4 January 2011, five days before the referendum, and said he would respect the result, whatever the outcome, the Southern Sudanese finally believed that their dream would come true; 3,930,816 had been registered eligible to partake in the referendum, 51 per cent of them women.130 On 9 January, the long queues started at dawn and continued until dusk. Waiting was not a problem; it seldom is in Southern Sudan. Women lined up as much as men. Many places people were dancing in the queue, playing drums, singing and cheering. It was a blessing to wait for something so precious. More than anything, the referendum was a celebration; they would now take the final decision on where they belonged.

The referendum was conducted without incident. All international observers noted that it had been free and fair; the result was credible and legitimate. As we have seen, the outcome was an overwhelming majority for secession and an independent South Sudan. When the result of the vote was announced, with all members of the SPLM leadership and government seated in anticipation, even the toughest freedom fighters could not hold their tears back. Several SPLM leaders later told me that this moment was the most emotional of all. The vote was even more overwhelming than expected. The celebration that followed lasted for days.

With independence, people really expected change. Otherwise, there was a high risk that the credibility of the liberators would be at risk. After secession they could no longer blame Sudan. As one leading member of the SPLM says, ‘The scapegoat had escaped.’131

It appeared that a country had been born, largely without a state. While the former peacekeeping mission for obvious reasons had a limited mandate in relation to building capacity, and was focused on monitoring implementation of the CPA, this role changed with establishment of the United Nations Mission in South Sudan the day before independence. UNMISS had a more ambitious state-building and peace-building mandate than was normal in similar missions elsewhere, with capacity development a priority.

In addition to the mandated tasks of building capacity in areas such as rule of law, police and law enforcement, extension of state authority, and support for democratic governance, the Mission was tasked with developing and coordinating one of the first Peace Building Support Plans in the UN’s history. Peace consolidation, peace- and nation-building were thus at the heart of the mission’s mandate.

Political capital had all been invested in getting the referendum and independence; underneath the euphoria of newly won freedom was a lingering question: what now? The SPLM had not developed a vision for building their new nation, a strategy to heal broken relationships and weld diverse pieces into one. At the same time, the leadership was swamped in crisis management, unable to focus attention on the long term. This in itself might have contributed to exacerbating the impending crisis.

A major problem for all state-building efforts, a concern of donors, national and international stakeholders alike, was entrenched corruption. South Sudan entered Transparency International’s index as an independent country in 2011 with the following description:

Corruption permeates all sectors of the economy and all levels of the state apparatus and manifests itself through various forms, including grand corruption and clientelistic [sic] networks along tribal lines.132

Kiir’s steps to curb corruption were timid, too little and too late. In his independence speech the President recognized as much:

Official corruption has been one of our major challenges during the interim period. In order to develop our country, and deliver on the important goals of our National Development Plan, it is critical that we fight corruption with dedication, rigour, and commitment. As president, I pledge to you to do all I can to remove this cancer. We will work closely with our development partners as we move forward.

But the Independence Day celebrations themselves had ludicrously been another opportunity for kickbacks, ‘cuts’ and backroom deals. At least several million dollars was reportedly misappropriated by companies and officials.133

Mismanagement was also illustrated by another scandal related to independence. Only after passports for the new Republic of South Sudan were produced in huge numbers and at a cost of millions was it realized that a printing mistake rendered them invalid. Yet, I hoped this was not an omen.

New country – new currency

Only two days after independence, the Government of South Sudan sent waves through the international community. It intended to adopt a new currency within a matter of days. Normally such a process takes a year, and at the very least six months. Less than that would entail significant macro-economic risk; the IMF’s advice was crystal clear. The reason for haste was a rumour that Khartoum was about to change its own currency, the Sudanese pound, and revert to the old dinar, presumably to render worthless the pounds held by the public and the Central Bank in South Sudan.

The leadership claimed solid evidence of Khartoum’s plans, and crisis meetings were held. The IMF and World Bank communicated their concern to the Ministry of Finance and the Central Bank. No country had ever done what the government contemplated.

When a new currency is launched it must either be pegged to another currency or floated on the open market to determine its exchange value. Pegging could be dangerous because it would commit the government to supporting an official rate of exchange without the reserves needed to do so. And even a ‘managed float’ entailed the risk of immediate collapse when done in such a short time.

Although the cabinet before independence had agreed on a transition period of nine months during which South Sudan would continue to use the Sudanese pound,134 they now seemed to reject advice on the issue. Apparently, no IMF missions were granted meetings with senior government officials. When I met the President on 11 July about this and other issues, with technical advice in hand, he said that they had not reached a decision. He promised to contact the Minister of Finance and discuss the issue further.

During this same week Sudan and South Sudan were meeting in Addis Ababa. There had been no indication that Khartoum would change its currency. On Sunday 17 July, at about noon, my phone rang. My colleague Haile Menkerios, Special Envoy to the Sudan–South Sudan process, was calling from the Ethiopian capital. The talks had just finished. Sudan and South Sudan had disagreed on interim financial-transfer arrangements, and no solution seemed in sight.

That evening I met informally the cabinet’s Crisis Management committee to discuss the currency issue. They were all sure that Khartoum planned to withdraw the Sudanese pound, with almost immediate effect. I argued the opposing case. But when Kosti Manibe, normally the most pragmatic and least emotional of SPLM leaders, also advocated quick action, I knew I had lost. ‘We are in a currency war with Khartoum’, he said. ‘They will try to use this issue to create havoc in our economy.’135

The Government went ahead. The South Sudanese pound was launched on 19 July, ten days after independence. It was a popular move. The initial exchange value was set at 2.96 to the dollar. Instead of letting the market determine its value over a longer period the government chose a managed float, requiring support should the currency come under pressure.136 All Sudanese pounds on the Southern side of the border now had to be exchanged for South Sudanese pounds in one go. The fear was that their Sudanese pounds would otherwise be rendered worthless. That exchange rate was 1:1.137 The Central Bank needed hard currency and gold equivalent in value to all currency brought into circulation. This was estimated at $432.5 million.

On 24 July, a week later, we got another surprise. While Khartoum kept the same currency in name, they launched new banknotes.138 People in Sudan could exchange their notes, but Khartoum would not redeem old notes in circulation in South Sudan (i.e. exchange it for USD or gold). This violated the agreement allowing use of Sudanese pound for nine months. So although there was no change of currency as such, in the end the South Sudanese Government was right, and I – among others – had been wrong. Fortunately they had gone to Switzerland in time to design a new currency of their own. In the ‘currency race’ South Sudan had been quicker.

New country – new reform opportunities

The Government’s decision to introduce a new currency so soon after independence met with resounding applause at the Opening of the National Legislative Assembly a month later. On that occasion the President also launched a 100-day plan for early peace dividends, of which some 85 per cent was implemented on time, despite criticism.139 The President also went much further in detailing concrete plans to root out corruption. Using the rhetoric of the liberation wars, Kiir defined the corrupt as enemies of the people, and launched several initiatives that included long-awaited legislation on financial management and audit, and strengthening of the Anti-Corruption Commission and the Audit Chamber. He warned senior officials present:

We will take action on their findings […] and there will be no loopholes for people who are addicted to mishandling public resources. There will be no sacred cows this time around.140

This made some people nervous. Maybe this time the President really meant business. Would there be a crackdown on corruption? The President told me privately that he had had enough. He had tolerated the corruption of comrades and ministers up to independence. But now it had to stop.

As combating corruption was also very important for state-building, I discussed with Salva Kiir what we in the international community could do to help. As early as in August 2011 high-level foreign experts were identified for secondment to key financial institutions. They were lined up, awaiting word from the President’s Office to move forward. The Central Bank was a particular subject of concern. It would now be responsible for receiving all oil income through the Treasury Account.141 South Sudan produced 350,000 barrels of oil per day, which would return billions of dollars in annual income. After independence this would no longer be shared with Khartoum, except for any special provisions the parties agreed on. The sheer scale implied higher risk of corruption.

Getting high level foreign experts for the Central Bank, Ministry of Finance, Anti-Corruption Commission and Audit Chamber was a top priority. The intention was to help reform the systems, build stronger institutions, and provide mentorship from experienced practitioners from other African countries. UNMISS was also in a position to assist the presidency with expertise in coordinating this effort.142 Progress seemed possible; the political cost of taking action would only increase with time.

The new cabinet was appointed on 26 August 2011, after a long delay. Ironically the signatories on the new currency notes, the Minister of Finance and Governor of the Central Bank, were no longer in office. Many other ministers remained, however, and some new faces and a number of deputy ministers catered for ethnic and gender balances.

A few weeks later the new government created consternation among international stakeholders. On the very day that the Bank of South Sudan was established, in September, the newly appointed Governor, Kornelio Koryom, announced a decision to fix the exchange rate of the South Sudanese pound against the dollar.143 Under terms of the Central Bank Law the authorities had been expected to operate a managed float for a period of up to six months, beginning in July 2011, and subsequently to peg it at a sustainable level vis-à-vis the US dollar.144 The Bank argued that a fixed exchange rate was necessary to drive down the black market for the pound, which in mid October was at about 4 to the dollar. But the rate fixed by the Bank overvalued the pound.145 To maintain it the Bank would need more dollars to buy pounds. Since it lacked sufficient dollars to do so, parallel exchange rates were born, one official, the other on the black market.

In acting in the way it did, the government had adopted a policy very lucrative for dealers in foreign exchange, who included a number of well-connected members of the SPLM/A and the government. Although the Bank of South Sudan was legally independent, it still had no board of governors. The Governor and staff operated without oversight. In practice, moreover, the government continued to intervene.

For international players – donors, businesses, the IMF and World Bank – the currency decision became another corruption scandal. Donors and commercial enterprises operating at the official rate of exchange all lost, as indeed did the government eventually. Donors calculated a loss in development aid of as much as $145 million and from international investors as several times more.146 Calculating losses was difficult, however, as the true (if imperfect) value of the currency could be ascertained only on the black market.

The decision of September 2011 was also politically costly. It made many stakeholders question South Sudan’s capacity for macro-economic decision making. And it added to suspicions that the entrenched culture of corruption had found in South Sudan’s independence new ways to serve the elite.

Following the appointment of the new cabinet, and these discussions, there was therefore a real sense of stasis. But on 21 September, as he departed for the UN General Assembly, Salva Kiir released another strong statement listing far-reaching steps he would take to fight corruption.147 This time there were concrete measures. His legislative programme centred on five bills related to public financial management and accountability, procurement, internal auditing, and petroleum and oil revenue management. He also launched processes for investigating and prosecuting corruption cases; public declaration of officials’ income and assets;148 review of land sales during the transitional period; and facilitating the return, anonymously or through the intervention of foreign governments, of illegally diverted funds.149 Would he now act on his promise that ‘those who had eaten stolen food would vomit it’?150

It was my clear impression that we would finally see action, a view which was buttressed by the President’s statement to the General Assembly and his comments in bilateral meetings in New York.

South Sudan loses its innocence

In New York, however, we got a first hint of problems that would arise in relations between South Sudan and the international community. (A meeting with President Obama will be discussed in the next chapter.) The Troika countries’ elaborate dinner in collaboration with Secretary-General Ban Ki Moon in tribute to South Sudan’s independence, with President Salva Kiir as guest of honour, descended into farce. The President sent word that he was ‘not well’, leaving the Secretary-General and some 70 heads of government, ministers and ambassadors waiting for a long time, before his ministers finally turned up, oblivious to the gravity of their diplomatic faux-pas. The SPLM’s sense of entitlement seemed to include the international community.

Interestingly, a similar charade occurred in the margins of the General Assembly in 2014. Illustrative of the change that had taken place in South Sudan in only three years, this time the event was not a celebratory dinner but a fundraising event to alleviate the humanitarian crisis caused by the current civil war. Despite the great personal efforts of the UN Secretary-General to make the event a success, Kiir did not attend. Similar inexplicable absences from summits and bilateral meetings gave rise to questions about the South Sudanese President’s commitment and health.

Protocol was one thing; war was another. Rumours were rife that elements within the South Sudan security apparatus were supporting the newly established SPLM-North in the Nuba Mountains of Southern Kordofan, as well as in Sudan’s Southern Blue Nile region. When the CPA protocols for both areas went largely unimplemented, and tensions rose, South Kordofan and Blue Nile, just as Abyei before them, were soon engulfed in open warfare with Khartoum.

Just prior to independence, Abyei was again engulfed in violence.151 In May the Sudanese Armed Forces occupied the town, which was burnt to the ground, and 100,000 people were displaced,152 prompting the UN Security Council to establish a protective force.153

But now the focus was on the other two areas. I had warned the President, before his departure for New York, that alleged military support for the SPLM-N would be raised in New York. Several countries reportedly had evidence through their own sources; he needed to be prepared to respond in a way that inspired trust. To me he denied that any lethal support was being provided. As expected, the issue dominated discussions in the margins of the General Assembly, and it would continue to torment Sudan–South Sudan relations and the latter’s engagement with the international community for a long time. Severing links between comrades would never be easy, but the issue could have been managed better by the South Sudanese Government in diplomatic circles, thus retaining at least some credibility.

The handling of other issues was also puzzling. After the currency issue, the first act of the new cabinet was the decision to move the capital from Juba to a place called Ramciel, which few people had even heard of. I had to find it on a map – and with some difficulty, for it was a tiny village. The rationale for this decision appeared to be tensions between the central Government and Equatorian communities and authorities in Juba.154 I later learned that a ministerial committee had been engaged at the President’s request: consultants had been hired and some sketchy reports made. No one had done a proper feasibility study or any calculations of cost. It seemed clear that the new government had a long way to go.

Within two months of independence South Sudan’s Government had made several decisions that surprised most observers. But most international interlocutors continued to give the government the benefit of the doubt. They still thought that independence had given the South Sudanese a new opportunity to get things on the right track.

More worrying was the concern that such decisions might prove the norm rather than the exception, as the cabinet settled into a disappointing and ineffective modus operandi. We saw no plans for reforms or commitment to clean up the existing system. We saw no evidence that the Core Functions process was under way, or any desire to wage war against poverty. Ministers appeared more interested in protecting their positions than in moving the country forward. In discussions with me the President expressed serious concern, and a desire for change. But would he now deliver?

One of the experts we helped to recruit was John Githongo, the anti-corruption tsar from Kenya, whom I had known for many years. He met the President, and was convinced of a willingness to fight corruption. We organized a preliminary consultancy contract, pending other arrangements. Several top-notch foreign experts, all from the region, met the President, and a plan was adopted to deploy them to key sectors of financial management and monetary policy.155 But despite these commitments, nothing happened.

The political cost of moving on these issues should have been lower now than at almost any other time. Independence had been achieved. Elections need not be held for almost five years. It was time, one assumed, to fight corruption, clean up payrolls, be bolder in reforming the security sector, pass legislation that had been delayed for ages, and so forth. Yet there seemed to be little political will. The key was the President; would he show strong leadership on these issues? Without it not much would move.

The Security Council had requested UNMISS to develop the Peace-building Support Plan within four months, by 9 November 2011.156 The plan was meant to strengthen assistance and coordination in key peace-building areas such as conflict prevention and resolution, rule of law, security sector reform and socio-economic interventions. The process was delayed, however, as the cabinet first discussed the issue around this time.157 During the next quarter, there were consultations with all stakeholders and donors. While this could have been an opportunity to move critical reforms forward, the government had neither the appetite for this, nor the capacity for yet another plan, and the outcome was based on already agreed objectives.158

In any case, the new cabinet was engulfed in disputes with Khartoum over the terms of the secession, whether border demarcation, the status of Abyei, or the use of the oil pipeline. Indeed, an important reason for the delays and lack of attention to important issues was the tension with Sudan. Despite all the efforts and pressure exerted on both sides, independence had been declared against the backdrop of numerous unresolved issues, of which some were linked to fundamental national interests. The divorce from Sudan was incomplete. Most fundamentally, there was no agreement on the international boundary.

I had always thought that the two parties would ‘muddle through’, usually after all deadlines had passed and when they had peered over the edge of the abyss. This had been the case throughout the CPA negotiations, and was a traditionally Sudanese way of doing things.159 As Daly mentions in his book on Darfur, a word for delay in Arabic, tajil, had led to an Anglo-Sudanese coinage of ‘tajility’ as a method of getting one’s way by stalling.160 But now things had been delayed to the point of inanition.

Unresolved issues included the border; border security and trade; use of the oil pipeline to Port Sudan, including interim financial arrangements; management of water resources, including the Nile; division of assets and liabilities; citizenship and citizens’ rights; and cross-border migration.161

Opinion polls now showed mounting concern. That as many as 42 per cent thought the country was heading in the wrong direction in September 2011, just after independence, said a lot.162 In a representative focus-group study conducted across all ten states by the National Democratic Institute (NDI) in November 2011 found the same. A large majority said that South Sudan was headed in the wrong direction, a result ascribed to poor management, lack of development and services, and insecurity.163 The new ‘liberation war’, against poverty, ignorance and disease had not been waged; people were beginning to see that their leaders were responsible.

The ‘liberation curse’ prevailed. The leadership did not make the necessary transitions or implement essential reforms. It also allowed the ‘oil curse’ to skew priorities, delaying critical state-building and peace-building interventions. While some progress had been made in the transition from war to peace and from liberation movement to government, there was a very long way to go.

The transition from being part of a united Sudan to completing the secession as an independent country had reached its most difficult stage. The South Sudanese were consumed by numerous crises. But relations with Sudan trumped everything else, whether the country’s reform agenda, or growing tensions internally in the leadership. And as the tensions with Khartoum increased, the liberators were soon back in the trenches, united against Sudan.

The liberation struggle was not over.