United Nations — UN experts say South Sudan is close to securing a $13 billion loan from a company in the United Arab Emirates, despite struggling to manage debt from its oil reserves.
The deal with the company’s Hamad Bin Khalifa Project Unit would be South Sudan’s largest ever oil-backed loan, according to loan documents seen by the panel of experts in a report to the United Nations Security Council.
“Repaying these loans will tie up the majority of South Sudan’s revenue from oil for years,” experts monitoring the arms embargo on South Sudan said in the oil section of a report obtained by The Associated Press this week. price.”
The Hamad Bin Khalifa Project Unit registered in Dubai does not have a registered phone number and its website is not working. The email address associated with your company bounced. The UAE’s mission to the United Nations declined to comment, saying Hamad was a private company.
South Sudan gained independence from Sudan in 2011 after a decades-long civil war that killed millions, and oil is the backbone of the young nation’s economy.
South Sudan waged a civil war from 2013 to 2018 shortly after independence, and rivals President Salva Kiir and Vice President Riek Machar signed a power-sharing agreement and formed a coalition government. South Sudan is under pressure from the United States and other countries to more quickly implement a 2018 peace deal that ended the civil war and prepares for elections.
South Sudan produced an average of about 149,000 barrels of liquid fuel per day in 2023, according to the latest update from the U.S. Energy Information Administration. The landlocked country of South Sudan uses Sudan’s pipelines to transport oil to Port Sudan for shipment to global markets. The Sudanese government collects $23 per barrel for transportation costs for oil exports.
South Sudan’s Information Minister Michael Makuei Lueth told reporters in February that external factors, including Sudan’s civil war, had hurt the country’s oil exports. He also said the wells, which were waterlogged due to heavy flooding during the last monsoon season, are not yet fully operational.
The oil section of the expert report shows that the loan was split into tranches, according to the UAE company’s loan documents signed by South Sudan’s finance minister between December and February.
About 70% of the loan will be allocated to infrastructure projects, according to the document, with the first payment exceeding $5 billion, the panel said. After the three-year grace period, “the loan will be guaranteed for delivery of crude oil for up to 17 years.”
The expert panel raised serious questions about South Sudan’s oil-based debt.
South Sudan lost a case at the International Investment Dispute Settlement Center regarding a $700 million loan it received from Qatar National Bank in 2012.
As the panel wrote its report, the tribunal had not reached a decision on how much the government should pay, but the Sudan Tribune reported on Sunday that South Sudan had been ordered to pay more than $1 billion.
The expert panel said it also found the government owed $151.97 million to the Eastern and Southern African Trade and Development Bank for previous oil-related deals.
South Sudan was scheduled to hold elections before February 2023, but the schedule was postponed to December 2024 in August last year.
UN experts say South Sudan will get $13 billion in funding. (12″>South Sudan’s president warns lawmakers “not to cling to power.” His former rival proposed postponing the election just weeks after becoming deputy speaker.
The expert panel said it would be a “significant milestone” and warned that time was running out for the country’s leaders “to ensure that divergent expectations do not cause further tensions and conflict.”
Experts also pointed out the humanitarian crisis in South Sudan. According to the United Nations, about 9 million of the country’s 12.5 million people are in need of protection and humanitarian assistance. Additionally, the number of refugees fleeing war in neighboring Sudan has increased, making humanitarian assistance to affected people in South Korea more complex. Internal conflict in Sudan.
