VZCZCXRO0063
PP RUEHROV
DE RUEHKH #0720/01 1291348
ZNR UUUUU ZZH
P 091348Z MAY 07
FM AMEMBASSY KHARTOUM
TO RUEHC/SECSTATE WASHDC PRIORITY 7126
INFO RUCNIAD/IGAD COLLECTIVE

UNCLAS SECTION 01 OF 02 KHARTOUM 000720 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
E.O. 12958:  N/A 
TAGS: PGOV PINR PREF ECON EAID KDEM SU
SUBJECT: GOSS Governor's Forum Focuses Tackles State Budgets and 
Security 
 
REF: A) Khartoum 0693 B) Khartoum 0591 C) Khartoum 0211 
 
¶1.  (U) Summary:  The Government of Southern Sudan's (GOSS) Fourth 
Governors' Forum (the Forum) has brought into sharp focus the budget 
crises in the ten southern states.  GOSS President Salva Kiir 
admonished the governors to put in place good governance practices, 
downsize their civil services, promote the census, remain focused on 
security, seek non-oil revenue sources, and implement affirmative 
action measures to ensure 35 percent participation by women in state 
and local government.  End Summary. 
 
¶2.  (U) The Forum was held in Juba May 4-6, with the participation 
of the governors or deputy governors of all ten southern states, 
along with GOSS ministers and commissioners, representatives from 
the UN agencies, the World Bank Multi-Donor Trust Fund, and 
diplomatic and donor communities.  The Forum, held under the theme 
"State Planning, Budgeting, Employment in States, and DDR" also 
included the state Ministers of Finance.  The goal of the Forum is 
to facilitate a meeting every three months with the governors and 
the president, key ministers and the international community. 
 
From Security to Economic Focus 
------------------------------- 
 
¶3.  (U) Kiir addressed the Forum noting that the gathering had moved 
from its first preoccupations with security issues, including the 
Lord's Resistance Army, Other Armed Groups, and continuing Sudan 
Armed Forces' presence in Unity and Upper Nile States, to the 
pressing economic issues crippling the states' ability to meet 
payrolls, run operations, or implement development programs.  While 
Kiir noted that there were still security concerns in some states, 
he focused his remarks on the need for greater attention to good 
governance, accountability and transparency and strengthening the 
private sector.  He criticized states for misusing public funds and 
maintaining bloated payrolls with ghost workers, many inherited from 
the war years (reftels).  Kiir stressed that oil revenues had been 
declining substantially since January and that the inability to meet 
the GOSS payroll was extremely serious.  Cutting the payroll does 
not mean denying people their rights, but was a hard decision that 
had to be made and fully explained to the people, Kiir added. 
 
¶4. (U) Acting Finance Minister Gabriel Changson Chang elaborated 
that while Southern oil revenues had been between USD $38 to $40 
million a month, the GOSS payroll was USD $60 million a month. 
Changson also reported that he had just returned from Khartoum where 
he attempted to borrow from the Bank of Sudan to meet the Southern 
budget shortfalls and was turned down.  He stated that there was 
disagreement with Khartoum over whether the GOSS could borrow money 
from international sources under the CPA.  Changson said that April 
salaries would be delayed, but eventually paid. 
 
Support the CPA 
---------------- 
 
¶5. (U) Kiir warned the governors against dealing directly with the 
Government of National Unity (GNU) and said that was the main reason 
the former governor of Warrap State had been removed recently.  Kiir 
also urged the governors to help implement the CPA by promoting the 
upcoming census.  He called for the establishment of State 
Population Committees and stressed that "without the census we can't 
run a meaningful election or referendum."  Some states expressed 
concerns that the November census date would not be met because of 
the lack of roads and the presence of landmines and ongoing 
insecurity. 
 
¶6. (U) The GOSS President reiterated the need to address the 
non-implementation of the Abyei Protocol, and indicated that an 
agreement with Khartoum on an Interim Administration to provide 
essential services was likely to be reached. 
 
¶7. (U) Gender inequities must be addressed Kiir warned.  He 
reiterated the SPLM's commitment to ensure 35 percent representation 
in all levels of government by women, above the 25 percent called 
for in the CPA.  He reminded the governors that it was a violation 
of the CPA to not strive to meet this target goal. 
 
Shifting From the Central to the State Governments 
--------------------------------------------- ----- 
 
¶8. (U) The overall message of the Forum was that the governors had 
to seek creative ways to deal with the economic crises in the states 
and that there would be no room for excuses.  Governors were 
directed to:  1) address ethnic conflicts and submit reports on 
their actions to the President; 2) create non-oil sources of 
revenue; 3) accelerate the return and resettlement of refugees and 
internally displaced people; 3) purge the payrolls of ghost workers 
and excessive numbers of civil servants and fight corruption (this 
was listed as among the highest priorities); and 4) prepare their 
state budgets in time for them to be integrated into the GOSS 
budget. 
 
KHARTOUM 00000720  002 OF 002 
 
 
 
¶9. (SBU) Comment: The Forum has become a more structured and serious 
venue for coordination between the different levels of government in 
the South, reflecting the challenges and successes of 
democratization since the signing of the CPA.  The states are being 
told that they must shoulder a larger share of revenue generation 
and clean up their houses to eliminate waste - the oil revenue 
cushion is no longer available.  Decentralized government, though 
struggling to take root, is on track, in Southern Sudan.  It will, 
however, need intense care and feeding to sustain it, but the 
process is moving forward. End comment. 
 
BERNSTEIN