In 2005, a historic peace agreement brought an end to Africa’s longest-running civil war – the 22-year conflict between north and south Sudan. Tensions over the distribution of the country’s vast oil wealth had exacerbated the conflict, but oil was also a key component of its resolution.
The 2005 Comprehensive Peace Agreement (CPA) was underpinned by a deal to split the revenues from southern oil evenly between the north and south. Rather than driving conflict, oil became a basis for peaceful cooperation.
However, a lack of transparency and independent verification of the deal’s implementation fuelled mistrust between the two sides and repeatedly threatened the fragile peace. The CPA’s oil deal ended with South Sudan’s independence last year and a new one is yet to be struck.
Without an agreed basis for exporting South Sudan’s crude oil via Sudan’s pipelines and port, tensions have escalated dramatically. Earlier this year, Sudan began confiscating South Sudanese crude in lieu of transit fees believed owed since independence. South Sudan responded by shutting down oil production. Though this prevented Sudan from accessing the oil, it also cut off more than 98% of South Sudan’s income.
With both economies in crisis as a result of the loss of oil revenues, the need for a new oil agreement is greater than ever. A new deal would provide a tangible, economic incentive for peace and help pave the way for future political and economic cooperation. But in order for any new agreement to be sustainable in the long term, it must be implemented transparently and monitored independently so that the countries and their citizens can trust it is being managed fairly.
In South Sudan---the world’s newest and most oil-dependent country---it is vital that the government follows through on commitments to managing its natural resources transparently and in the best interests of the wider population. Implementing the public reporting and auditing mechanisms already enshrined in law will be central to development and stability, combating corruption, and attracting responsible investment.