VZCZCXRO9796
PP RUEHGI RUEHMA RUEHROV
DE RUEHKH #0100/01 0240940
ZNR UUUUU ZZH
P 240940Z JAN 08
FM AMEMBASSY KHARTOUM
TO RUEHC/SECSTATE WASHDC PRIORITY 9771
INFO RUCNFUR/DARFUR COLLECTIVE PRIORITY
RUEHRN/USMISSION UN ROME

UNCLAS SECTION 01 OF 02 KHARTOUM 000100 
 
SIPDIS 
 
AIDAC 
SIPDIS 
SENSITIVE 
 
STATE FOR AF/SPG, PRM, AND ALSO PASS USAID/W 
USAID FOR DCHA SUDAN TEAM, AFR/SP 
NAIROBI FOR USAID/DCHA/OFDA, USAID/REDSO, AND FAS 
GENEVA FOR NKYLOH 
NAIROBI FOR SFO 
NSC FOR PMARCHAM, MMAGAN, AND BPITTMAN 
ADDIS ABABA FOR USAU 
USUN FOR FSHANKS 
BRUSSELS FOR PBROWN 
 
E.O. 12958:  N/A 
TAGS: EAID PREF PGOV PHUM SOCI UN SU
SUBJECT: USAID-FUNDED TRANSITION PARTNER ACCUSED OF VIOLATING 
SUDANESE NGO LAW 
 
KHARTOUM 00000100  001.2 OF 002 
 
 
KHARTOUM 91 
 
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SUMMARY 
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¶1.  (SBU) Development Alternatives, Inc. (DAI), a USAID assistance 
partner, will close out its program in Sudan on January 31, 2008. 
After a week of negotiations with the Government of National Unity 
(GNU) Humanitarian Affairs Commission (HAC) over disposition of 
assets, DAI was told by HAC that it was in violation of Article 7 of 
the Organization of Humanitarian and Voluntary Work Act and will be 
prosecuted.  According to DAI, HAC reportedly told DAI it is also 
gathering evidence against USAID with the aim of closing down 
USAID's programs in Sudan. End Summary. 
 
--------------------------------------------- ---- 
BACKGROUND OF DAI CLOSE-OUT AND SEIZURE OF ASSETS 
--------------------------------------------- ---- 
 
¶2. (SBU) Development Alternatives, Inc. (DAI), an assistance partner 
under USAID's Office of Transition Initiatives' (OTI), was 
contracted to implement a small grants program in Sudan to help 
create space for peaceful political change and for longer-term 
development activities.  Due to contractual issues, DAI is closing 
out its offices and scheduled to leave Sudan on January 31, 2008. 
Another assistance partner has been awarded a contract to carry out 
OTI's mandate in Sudan. 
 
¶3. (SBU) For more than a week, USAID and DAI have been in 
negotiations with the HAC over disposition of DAI's assets, 
including vehicles and equipment. (Note: This issue has been a 
thorny one for NGOS throughout 2007 when closing out projects or 
programs).  In 2007, HAC pressured NGOs operating in Darfur to 
include new language in technical agreements signed between the NGO 
and the government to turn over all assets to HAC at the close of a 
project.  NGOs then sought donor advice, and USAID and other 
international donors coordinated their approaches in responding to 
this issue. End Note.)  This marks the first time that a USAID 
implementing partner has had to deal with the HAC on asset 
disposition.  Through these negotiations, USAID has sought to ensure 
that DAI's assets can be transferred to USAID's other implementing 
partners to continue USG-funded work as allowed by Sudanese law. 
However, the Sudanese government has held that it has the right to 
determine which organizations or government offices receive DAI's 
assets. 
 
¶4. (SBU) On January 17, HAC in El Fasher refused to grant exit visas 
to DAI staff until DAI relinquished all of their assets in El Fasher 
to HAC officials. (Note: Exit visas are required to leave the 
country. End Note.)  In order to get the remaining staff person 
safely out of Darfur, USAID authorized DAI to turn over all 
equipment.  Assets are now with HAC in El Fasher. 
 
¶5. (SBU) On January 19, HAC officials in Nyala entered the DAI 
residential and office compound, where USAID field staff reside and 
work, and informed USAID that it had been ordered to take DAI's 
assets in Nyala as well.  Upon hearing that DAI in Nyala had already 
left the region, HAC officials said that they would wait for further 
orders from Khartoum. 
 
¶6. On January 21, USAID/Sudan Mission Director Patrick Fleuret had a 
positive meeting with the HAC Commissioner in Khartoum, Hassabo 
Abdel Rahman, to agree on steps to avoid such an incident as in El 
Fasher in the future.  On January 22, CDA Fernandez made the same 
points to the new Minister of Humanitarian Affairs and Hassabo 
(reftel). Although no agreement was reached on the disposition of 
the assets seized in El Fasher, the two sides agreed to send a team 
with representatives from both HAC and USAID to El Fasher and Nyala 
to survey the situation there.  Hassabo also expressed his desire to 
enter into a technical agreement with USAID.  USAID participants 
responded that they would be open to discussing a technical 
agreement, but urged that the current matter of the equipment seized 
from DAI would need to be resolved first. 
 
------------------------------------------ 
MEETING BETWEEN HAC's NGO DIRECTOR AND DAI 
------------------------------------------ 
 
 
KHARTOUM 00000100  002.2 OF 002 
 
 
¶7. (SBU) On January 22, DAI's Chief of Party, who is head of DAI in 
Sudan, was called into the HAC offices in Khartoum to discuss final 
close-out of activities with the HAC NGO Director, Moutassim 
Abulgassim (GOS Sources told Charge on January 23 that Abulgassim is 
a NISS official placed at the HAC).  According to DAI, Abulgassim 
communicated three points: 1) DAI is in violation of Article 7 of 
Sudan's humanitarian law.  This is based on the allegations that DAI 
has been providing large sums of money to non-governmental 
organizations (NGOs) without consulting HAC or establishing 
technical agreements (Note: Article 7 provides:  "Donation and 
fundraising for the organization's programmes shall be undertaken 
though a project document to be approved by the Commission, as may 
be prescribed by the Regulations." End Note.); 2) the Sudanese 
government has "every right" to assume that DAI is supporting 
opposition activities aimed at destabilizing the government, as well 
as directing activities against the internal security of the state; 
and 3) DAI, as the implementer of these activities, can and will be 
prosecuted to the fullest extent of the law, including imprisonment. 
 
 
¶8. (SBU) According to DAI, the HAC Commissioner requested that 
within 48 hours DAI resolve a labor dispute over severance packages 
to outgoing staff, provide proof of procurements of commodities for 
in-kind grants, write an official statement from DAI to USAID 
reporting that DAI has been informed that it has violated Article 7 
of Sudan's humanitarian law, and that DAI be prepared to send staff 
to El Fasher and Nyala for handover of assets, if required to do so 
by the HAC Commissioner.  HAC communicated to DAI that if these 
conditions were satisfied, then DAI would obtain exit permits from 
Sudan. 
 
¶9. (SBU) DAI further reports that Abulgassim stated, at the 
conclusion of the meeting, that the Sudanese government is gathering 
evidence to support its allegation that USAID is illegally meddling 
in the internal affairs of the country with the intention to close 
down USAID programs in Sudan.  Abulgassim reportedly also stated 
that the government was preparing a media campaign to that effect. 
CDA will raise these allegations with the next senior Sudanese 
official he meets. 
 
-------------------- 
ONGOING DAI RESPONSE 
-------------------- 
 
¶10. (SBU) DAI is working to comply with all HAC requests within the 
48-hour time period.  DAI has a country agreement signed with HAC to 
implement its activities.  As a matter of routine, DAI requires all 
of its grantees to obtain HAC approval, which is documented in its 
agreement with the grantee, of all events and activities that it 
supports. As of January 23, DAI has only handed over assets in El 
Fasher. 
 
¶11. (SBU) Comment: We are very concerned over this escalation of the 
asset disposition issue and administrative close-out of the DAI 
program, and are working to ensure that the issue is resolved 
quickly.  Although the HAC reportedly just extended the moratorium 
easing restrictions to humanitarian access (according to media 
reports) for Darfur, we expect that the struggle over access to 
Darfur will only escalate as UNAMID deploys more fully and western 
NGOs seek to assist with census and elections preparations.  As is 
often the case in Sudan, the questions will be: how orchestrated is 
this campaign of petty harassment, how far will they go and how 
enshrined is it as Sudanese state policy? 
 
FERNANDEZ