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Transitional government attempts to revive economy, while challenges remain over opposition cohesion, military consolidation – Sudan Analysis

Executive Summary

The transitional government is likely to focus on reviving the crippled Sudanese economy, with PM Abdullah Hamdok likely looking to realign the budget, rerouting funds from military expenditure towards social welfare programs. However, these military budget cuts retain the potential for increased tensions between the security establishment and the civilian authority in the government.

Another major challenge for PM Hamdok will be the ability to keep the political opposition united given the disparate groups that form the Declaration of Freedom and Change (DFC). The military is likely to focus on the divisions between the various groups within the DFC in an attempt to break the coalition and thereby consolidate power in the coming months.

That said, there will remain latent tensions within the military establishment over relations between General Abdel-Fattah al-Burhan of the Sudanese Armed Forces (SAF) and Rapid Support Forces (RSF) leader Mohammed Hamdan “Hemetti” especially over the latter’s control of lucrative gold mines in the outlying regions, which leave the RSF in a better position to fund and pay its troops in coming months.

Current Situation

An eleven-member Sovereign Council was formed on August 20, to be led by General Abdel-Fattah al-Burhan for the next 21 months. On September 8, an 18-member cabinet led by PM Abdalla Hamdok was sworn in.

On September 9, the Sovereign Council and the Sudanese Revolutionary Front (SRF) agreed to start peace talks in October with a final peace agreement slated to be signed by the end of the year.  Meanwhile, Abdel Wahid al-Nur, leader of (SPLM-N) stated that he did not recognize the transitional government, and withdrew from ongoing negotiations with Khartoum on September 10.

Severe bread and fuel shortages were reported in various parts of the country on September 14, resulting in repeated protests in Kassala, South Darfur, and Khartoum states over the subsequent days and weeks.

On September 14, the acting governor of South Kordofan ordered an immediate stop to all gold mining activities in the state as reported on September 14 following multiple protests against Rapid Support Forces (RSF) owned mines over chemical polluting the local environment.

In the first joint meeting of the Sovereign Council and the cabinet, the two bodies amended Transitional Constitutional Document that allows the appointment of the Attorney General and the Chief Justice on October 2.

The US Assistant Secretary of State said on October 2 that Sudan’s removal from the State Sponsors of Terror list is “a process, not an event”. Following this, the Sudanese pound’s exchange rate hit a new low against foreign currencies.

PM Hamdok continued to warn of disastrous consequences for Sudan if the world did not negotiate in getting the country removed from the US list of state sponsors of terrorism on October 3. In connection, the World Bank on October 4 stated that Sudan needed to meet minimum criteria before it could be given foreign debt relief.

Assessments & Forecast

Transitional government likely to focus heavily on reviving economy, though attempts to realign budget likely to face military pushback

On September 28, new Prime Minister Abdalla Hamdok urged the US to remove Sudan from its list of “state sponsors of terrorism”, framing it as punishing Sudan for the acts of the former government. Hamdok’s focus on getting Sudan removed from that list is indicative of the crippling effects that the sanctions, which makes the country ineligible for much-needed debt relief and funding from international institutions, as well as limits potential foreign investment. In this context, there remains considerable doubt over the new Sudanese government’s ability to revive its stagnant economy, a priority given that protests against the former President Omar al-Bashir’s government started in December 2018 over the rise in prices of essential commodities amid skyrocketing inflation.

That said, in the short term the government will likely look to prioritize fiscal reforms, as well as measures to contain inflationary pressures and boost productivity in critical sectors. In this endeavor, the transitional government will likely look to leverage the legitimacy and trust gained from the successful implementation of the first stage of the power-sharing agreement to reform the budget and cut spending. Previous budgets have focused on the security apparatus, state transfers, and subsidies, which together make up 70 percent of the official budget. FORECAST: To better highlight its credentials as a civilian government, the PM will likely look to realign the budget to give greater priority to health, education, and social welfare, which together are currently allocated less than 10 percent of budgetary expenses. In this context, in the near term, there remains a heightened possibility that anti-government protests will begin recurring in the coming months if the government does not take immediate steps to reduce high of bread, while also alleviating chronic fuel shortages. Given the security forces disposition towards forcibly suppressing protests, makes it likely that any renewed protests will likely be met with force.

Additionally, given that security sector wages account for approximately 60 percent of all government salaries, reducing military personnel and costs will likely prove to be a politically sensitive and difficult process requiring support from the armed forces and its leaders in the transitional administration. In this context, realigning the budget will likely prove to be a major flashpoint and source of tensions between the PM and the Sovereign Council, which is led by senior military figures such as General Abdel-Fattah al-Burhan and Rapid Support Forces (RSF) leader Mohammed Hamdan ‘Hemetti’. The military establishment will likely not countenance any cuts to the budgets, which could lead to a reduction in salaries for the armed forces, especially given their long-established practice of keeping the security forces well stocked and thereby relatively reliable even in times of nationwide upheaval as witnessed during the most recent nationwide protests. FORECAST: In this scenario, any attempts by the government to trim the security budget is likely to lead to consternation by the security establishment, as they will likely perceive the move to be the civilian authority under PM Hamdok attempting to curb the military’s influence on crucial revenue streams, thereby heightening the potential for civil-military unrest in the coming months, however this unrest is remains unlikely to devolve into large-scale violence at this time.

Furthermore, over the coming months, the biggest obstacles to the government in reforming the economy will be to dismantle the entrenched patronage networks that continue to hold control all institutions and key sectors of the economy. One of the sectors where this reform is most crucial is the gold mining industry, a sector which has taken on additional significance following the loss of nearly 70 percent of oil production after South Sudan seceded in 2011. Sudan is Africa’s third-largest producer of gold, with production in 2018 officially stated to be 93 tons which is equivalent to approximately 4 billion USD, with gold also now being Sudan’s main source of hard currency. That said, the al-Bashir government used the gold sector for patronage and to secure loyalties, often leading to huge inefficiencies and leaving companies tied to political interests and the security services. Such practices are best exemplified in South Kordofan where multiple gold mines are controlled by the RSF and Hemetti, who often uses the revenue from the mines to enrich himself and to assure the loyalty of his forces. FORECAST: In this context, any efforts to open up the mining sector to private investment will likely directly lead to tensions with elements of the security establishment, who may perceive that privatization of hitherto public assets would lead to them losing control of a major revenue stream.

PM Hamdok faces challenge of balancing competing factions within DFC, delivering on expectations of justice

One of the major defining traits of the protests that forced the military coup that finally toppled al-Bashir and then eventually led to the signing of a power-sharing agreement between the TMC and the Declaration of Freedom and Change (DFC) was the cohesiveness of the political opposition. The SPA’s role in circulating information about resistance activities meant that the movement was able to sustain its momentum and regularly stage demonstrations. The cohesiveness of the protest movement also proved vital in the talks concerning the transitional rule too, as it helped the military and the mediators identify counterparts within the DFC that, while not directly representing various opposition groups, enjoyed a relative degree of credibility as representatives of the political opposition.

The DFC also consists of parties such as the umbrella group of Darfuri armed groups known as the Sudan Revolutionary Front (SRF), who have consistently petitioned for positions within the transitional government. However, following the signing of the power-sharing deal, the SRF currently holds no position in the Sovereign Council, which is likely suggestive of the DFC’s reticence in allowing the SRF back into the mainstream political space. In this context, the SRF continues to lobby for amendments to the Constitutional Declaration drafted and signed by the DFC and TMC. The SRF contends that they represent marginalized areas in the country, such as Darfur. That said, in the unlikely event of the government acquiescing to the SRF demands, it is notable that the SRF body is composed of myriad armed groups who have often clashed with each other during the long conflict against the government. This means that while the SRF appears to be united in the short term, any government rapprochement towards the group is likely to heighten internal tensions with the SRF, as the various leaders of the armed groups jostle for superiority and the chance to be presented with a lucrative cabinet position in Khartoum. FORECAST: Ultimately, the government is likely to continue negotiating with the SRF, to maintain the appearance of the administration wanting to facilitate pan-Sudan representation within the government while continuing to block the entrance of such volatile entities into the already delicate power-sharing agreement between the opposition and the military.

FORECAST: In this context, the SRF demands for constitutional amendments would inevitably slow down the process of establishing independent institutions in Sudan including a free judiciary along with the Legislative Council, whose vote is necessary to even initiate any legal action against Sovereign Council members such as Hemetti and other military leaders who the vast majority of the political opposition hold responsible for atrocities against protesters during the revolution to depose al-Bashir. In the event that the government ceded to the SRF demands of amendments to the constitutional agreement, the decision would then raise tensions within the political opposition, including the SPA, who using their neighborhood committees have already held mass protests in Khartoum and other urban centers reiterating the demand that governmental reforms be sped up. These protests were then dispersed by the security forces who likely considered the gatherings as a threat to national security.

While PM Hamdok has consistently stated the need for Sudan to build truly independent institutions including the judiciary, there remains a tension between the kind of justice that friction between the armed rebel movements and the DFC leadership, caused by diverging priorities concerning the emerging political order in Sudan. While the protesters led by the SPA strive to establish a civil rights-based rule, the parts of the DFC from the outlying areas of Sudan prioritize achieving peace and security and ending regional marginalization. The SRF initially rejected the Constitutional Declaration on the basis that it inadequately addresses the question of peace in conflict areas such as Darfur, Blue Nile and South Kordofan. FORECAST: Following the signing of the peace agreement, Darfur has witnessed a relative increase in violence against civilians by paramilitary forces including the RSF. This development and local actors’ disappointment at the way the Constitutional Declaration addresses the conflict situations puts the armed groups at odds with the emerging regime. While the agreement over the peace roadmap is a promising sign, frustration at the lack of progress in the peace processes will heighten the potential for increased violence in the outlying areas of Sudan over the coming months.

Military likely to seek to exploit opposition fragmentation in bid to consolidate power, though threat of internal split remains

Despite the positive development of power-sharing agreement between the military and the political opposition, security establishment backlash and consolidation of the military rule remains a real possibility. Sudan has a history of authoritarian backsliding, following similar successful non-violent uprisings in 1964 and 1985. Both movements were followed by a military takeover after a few years of tenuous and unstable multi-party rule. In this sense, the deep roots of military autocratic rule in Sudan are unlikely to dissipate easily. Generals such as Burhan and Hemetti are accustomed to exercising power and likely view themselves as cornerstones and essential elements for political and security stability. In this context, a full transition to civilian rule would likely lead to weakening in their powers, which would then expose them to possible legal retribution for alleged crimes against the population over the past two decades.

In contrast, the leadership in the DFC remains relatively inexperienced in ruling the state, as even PM Hamdok while a respected figure has resided and worked for much of his life outside of Sudan. However, given the protesters, relative success in indirectly leading to the deposition of al-Bashir, and forcing the TMC into agreeing to sign a power-sharing agreement with a commitment to eventually transitioning to a civilian government raises expectations to a high level. FORECAST: In this context, the military will likely aim to exploit differences within the DFC by negotiating deals with parties such as the SRF and the National Ummah Party (NUP), which have criticized the constitutional agreement for its failure to appoint SRF or NUP leaders to positions of influence within the cabinet. Furthermore, the military is likely to use the differences within the DFC to deepen existing fissures within the DFC, all the while using opposition disunity to consolidate power.

FORECAST: While the military is likely to use divisions within the DFC as a method to consolidate control of the country, there remains an underlying yet persistent possibility of splits within the security establishment itself. While General Burhan of the Sudanese Armed Forces (SAF) and Hemetti are both parts of the Sovereign Council as President and Vice President, there have been persistent tensions between the two groups over control of assets and resources. That said, the constitutional declaration shows an effort to simultaneously control the military by placing the RSF under the authority of the SAF, there remains doubt over whether this hierarchy can be maintained.

The position of the RSF is particularly precarious position with regard to the transition, as its involvement in the transitional bodies is unpopular as the force is perceived to be responsible for the June 3 crackdown on protesters in Khartoum, which is thought to have killed over 100 people. However, Hemetti’s position as Vice President of the Sovereign Council makes it exceedingly difficult for the political opposition to exclude the group. FORECAST: While Burhan and Hemetti have thus far resolved to work together within the transitional government framework, fragmentation within the DFC could lead to both leaders jostling to consolidate power within the government, which could then further exacerbate existing tensions between the two generals. Ultimately, the political and security environment in Sudan is expected to remains tense for the foreseeable future.

Recommendations

Those operating or residing in Khartoum, as well as other urban centers across Sudan, are advised to avoid the vicinity of all gatherings and protests given the continued risks of violence.

We advise against all travel to the Darfur region as well as South Kordofan and Blue Nile states given the volatile security situation caused by ongoing violence between the government and armed rebel groups as well as inter-communal clashes.

Those in Sudan are advised to maintain contingency and evacuation plans due to the continued risks of operating in the country during the political transition.

For any further questions or consultation, please contact us at [email protected] or +44 203 540 0434.