VZCZCXRO8048
RR RUEHROV
DE RUEHKH #0721/01 0811358
ZNR UUUUU ZZH
R 221358Z MAR 06
FM AMEMBASSY KHARTOUM
TO RUEHC/SECSTATE WASHDC 1982
INFO RUCNIAD/IGAD COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 0012
RUEHNE/AMEMBASSY NEW DELHI 0004
RUEHKL/AMEMBASSY KUALA LUMPUR 0001

UNCLAS SECTION 01 OF 02 KHARTOUM 000721 
 
SIPDIS 
 
SIPDIS, SENSITIVE 
 
E.O. 12958: N/A 
TAGS: EINV ECON EPET PGOV SU
SUBJECT:  PARTICIPANTS GIVE SOUTHERN SUDAN INVESTMENT AND 
DEVELOPMENT CONFERENCE LOW MARKS 
 
 
¶1. (SBU) Summary:  A putative Southern Sudan investment 
conference in Nairobi March 14-16 scored well on 
quantity, but missed the qualitative mark.  Most 
participants outside of the petroleum sector were there 
in search of contracts, not to invest, and those who had 
come to network with the top echelons of the Government 
of Southern Sudan (GoSS) were disappointed when the 
senior leadership did not show.  GoSS presentations on 
investment possibilities were vague and full of 
unanswered questions about regulatory codes and 
requirements for Sudanese equity partnership.  End 
Summary. 
 
-------------------------- 
No Shows and Few Investors 
-------------------------- 
 
¶2. (SBU) The Investment/Development Conference attracted 
nearly 300 paying participants, who each paid a fee of 
USD 2,200 to attend.  CWC Associates Ltd., the conference 
organizers, had advertised the following headliners from 
Sudan:  GoSS President Salva Kiir, Government of National 
Unity (GNU) Energy Minister Al Jaz, GNU Minister of 
Investment Malik Agar, GoSS Vice President Riek Machar, 
and GNU State Minister for Energy Angelina Teny.  None of 
them showed.  In fact, no one from the GNU attended, 
North or South.  GoSS speakers included lesser luminaries 
such as Energy, Mines and Industry Minister Albion Akol 
Akol, Agriculture and Forestry Minister Martin Elia, 
Minister of Commerce Trade and Supply Anthony Lino, GoSS 
Minister of Finance Chol, and Minister of Culture and 
Youth John Luk Jok, one of five GoSS members on the 
National Petroleum Commissi%n. 
 
¶3. (SBU) The paid participants for the most part were 
construction, logistics, aviation, and oilfield service 
contractors looking for business opportunities.  There 
were a handful of legitimate investors from Khartoum 
looking for possibilities, and a few representatives of 
the banking/financial sector, but the vast majority of 
serious investors were from the petroleum sector, and 
most represented companies already involved in Sudan: 
India's Reliance, Total, White Nile Ltd., Equator, 
Malaysia's Petronas, H Oil and Minerals Ltd., and South 
Africa's PetroSA.  Chinese petroleum companies were 
notoriously absent, or at least low profile. 
 
------------- 
Who Said What 
------------- 
 
¶4. (SBU) There were a number of speakers from the EU, 
DFID, the UN, the IBRD, and various NGOs and expert 
consultants.  For the most part, the presentations were 
informational and academic in nature, more geared to 
development than investment.  The need for transparency 
and a proper regulatory environment were underlying 
themes. 
 
¶5. (SBU) The GoSS speakers fared less well.  Jok was the 
most cogent in addressing the key area of interest -- 
petroleum -- but he publicly took the line that Super 
Block B contested between Total and White Nile Ltd. 
should be partitioned into smaller concessions. 
Ministers Lino and Makana called for investment in 
agriculture, forestry, and mining as well as petroleum, 
but none could offer specifics, including what the 
regulatory environment would look like.  Makana said that 
there was a draft investment code ready for ratification 
by the Southern Legislative Assembly that required 
Sudanese participation in foreign investment schemes, 
although he could provide no details. 
 
----------------- 
No One Left Happy 
----------------- 
 
¶6. (SBU) Paying participants who had come to make high- 
level contacts expressed displeasure with the 
proceedings, and some demanded their money back.  Total, 
which (unlike White Nile Ltd.) had agreed to provide 
conference funding and an elaborate dinner for the 
participants, was reportedly put out that it gained no 
access to high-level GoSS officials to plead Total's 
case.  Smaller participants, including a Dubai freight 
forwarder who paid USD 3,000 for a booth and was given a 
small folding table outside the front door (and demanded 
a refund), were also unhappy.  Another participant said 
that Makana's statement that foreigners would need local 
 
KHARTOUM 00000721  002 OF 002 
 
 
partners to help them move things through the GoSS 
bureaucracy was tantamount to saying that the investment 
climate was poor. 
 
------------------------------------ 
Shoddy Organization and Money Making 
------------------------------------ 
 
¶7. (SBU) A senior official of the Southern Sudan Chamber 
of Commerce and Industry (SSCCI) blamed the organizers 
for the outcome.  He said that Al Badr International 
Development Co. out of Kuwait was the chief culprit.  In 
2005, this company invited Riek Machar, Taban Ding, and 
two other senior GoSS members to Kuwait for a visit.  Al 
Badr representatives had subsequently visited Juba, 
bestowing generous gifts on a number of prominent 
southerners, although to date no investments had 
followed.  Al Badr had hired CWC Associate Ltd. to stage 
the conference, and Prime Resource Ltd., a consultant 
firm, to identify speakers.  Neither the SSCCI nor most 
line ministers had been consulted - SSCCI suspected that 
invitations had gone to senior officials and their names 
used to advertise the conference before confirmation of 
attendance was received. 
 
¶8. (SBU) The SSCCI official pointed out that the 
conference had been a significant money-spinner for CWC. 
In addition to participation and display fees, CWC had 
convinced various companies to fund representational 
events and had organized, for a fee, one on one meetings 
between GoSS officials and conference participants, 
although for the most part the latter did not show.  He 
added that -- while it had not been announced -- the 
investment code would require foreign investors to take 
on southern Sudanese partners to the tune of 51 percent 
equity shares. 
 
------- 
Comment 
------- 
 
¶9. (SBU) The conference missed the mark as far as 
investment was concerned.  There were few serious 
investors around, few of the top GoSS officials, limited 
flirtation between the two sides, and certainly no 
consummation of deals.  Networking was minimal.  It was 
abundantly clear that until mining, forestry, and 
investment codes are in place, the GoSS will not able to 
showcase what it has to offer.  If the investment code 
does indeed cede to investors the majority of the risk in 
joint ventures, but only a minority voice in ownership, 
the utility of future conferences of this nature remains 
in doubt. 
 
STEINFELD