- The Washington Times - Tuesday, September 11, 2001

A civil war has raged in Sudan since a 1989 military coup overthrew the democratically elected government. An estimated 2 million people have died in a conflict that has pitted the militant Islamic regime against Christians and other non-Muslims living in the southern parts of the country.

When President George W. Bush appointed former Sen. John Danforth as a special envoy to Sudan on Sept. 6, he said "The government has targeted civilians for violence and terror. It permits and encourages slavery."

But there is more behind Khartoum's ethnic cleansing than religious zealotry.

According to the U.S. State Department's 2000 human rights report on Sudan, "Government forces and allied militia pursued a scorched-earth policy aimed at removing populations from around the newly built oil pipeline and other oil production facilities."

The Sudanese government earns hundreds of millions of dollars from oil production made possible by foreign oil companies such as China National Petroleum Co. and Canada's Talisman Energy Inc. As one Sudanese Cabinet minister has said, "What prevents us from fighting while we possess the oil that supports us in this battle even if it lasts for a century?"

The oil companies have also been aiding the Sudanese regime in other ways.

In a letter to the Security and Exchange Commission last March, Rep. Frank Wolf, Virginia Republican, cited reports that a Chinese petroleum company has supplied the Khartoum regime with a radar system used to direct air attacks and that Talisman Energy allowed the regime to use one of its corporate airstrips for military operations.

There are also reports China has sent large numbers of security personal to Sudan, who do far more than just defend their oil facilities.

It is thus not surprising that those seeking to end the killing have focused attention on foreign oil interests in Sudan. Last June, the Sudan Peace Act (H.R. 2052) was amended by Rep. Spencer Bachus, Alabama Republican, to include a "Prohibition on Trading in U.S. Capital Markets."

This amendment targeted the trading in securities of foreign oil companies whose activities in Sudan are underwriting the regime's genocidal policies. It was accepted on a voice vote, and the bill then passed by an overwhelming 422-2 margin.

It will soon go to conference with the Senate version (S. 180 ) passed in July. The Senate version does not include any capital market restrictions on foreign oil companies despite the fact that among its findings is "the government of Sudan has repeatedly stated that it intends to use the expected proceeds from future oil sales to increase the tempo and lethality of the war."

The Senate bill also says "the United States should use all means of pressure available to facilitate a comprehensive solution to the war" but then leaves out the most potent means available.

Alarmed by the House vote, major business lobbies worked hard to block capital-market restrictions in the Senate. In an Aug. 21 letter to the U.S. Treasury Department, Bill Reinsch, president of the National Foreign Trade Council, also urged Mr. Bush administration opposition to the House bill because "the provisions can provide a serious disincentive for foreign firms to list on the U.S. securities exchanges would apply a different standard to foreign registrants than to U.S. companies, thus departing from the principle of national treatment … [and] sets a precedent that could result in similar capital-market exclusions being used as punitive measures aimed at other countries or to achieve other social or political objectives immaterial to the conventional investor assessment of the profitability and financial outlook of companies."

But are war risks "immaterial" to investors? Are the death of millions irrelevant to the "assessment of profitability?" Should U.S. foreign policy operate on the basis that all regimes and foreign entities should be treated alike; friend or foe, tyranny or democracy; war criminal or humanitarian? Of course not. Mr. Reinsch's argument is absurd on its face, not to mention immoral.

If portfolio managers took a broader account of risks, it would strengthen America's clout in world affairs. In an interview with the Toronto Globe and Mail, Talisman Energy president James Buckee said his company would leave Sudan under the threat of sanctions: "I don't think anybody could afford not to have access to the U.S. capital markets. No asset is worth that."

It's this very power of capital-market sanctions that has Wall Street upset. They don't want their lucrative fees and commissions as bagmen for the world's most odious and brutal regimes placed in jeopardy. Indeed, they squeal as if they were dependent on such blood money. Can't they find any respectable clients?

The American people expect their government to stand for higher principles. They should not expect to see their pension funds and savings syphoned off by unscrupulous brokers to finance genocide. The "cha-ching" of the cash register should not drown out the cries of agony in the Sudan. The next few days will reveal whether members of Congress prefer to listen to Wall Street or to their consciences.

William R. Hawkins is senior fellow at the U.S. Business and Industry Council.

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