- The Washington Times - Tuesday, August 24, 2004

KHARTOUM, Sudan — China, India, Malaysia and some European countries are dramatically expanding business ties with Sudan, taking advantage of U.S. sanctions that bar American companies from operating here, local officials and foreign diplomats say.

Companies from those countries — some of which are at least partially state-owned — are investing billions of dollars and working closely with the Khartoum government with little concern about its role in recent mass killings in Sudan’s Darfur region, Western diplomats say.

“They couldn’t care less how many people are dying in Darfur — that’s not how they conduct their policies,” one senior diplomat said. “Everyone has an agenda here. Sudan has oil, gold and a major port on the Red Sea.”

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These companies also are replacing old American technology sold before the sanctions, which were imposed unilaterally by Washington in stages during the 1990s to punish Khartoum for its support of terrorism and human rights abuses, the diplomats say.

“Most of the cotton-gin machinery here is American, but they can’t get spare parts. So Chinese companies provide inferior — but nevertheless suitable — replacement parts,” another senior Western diplomat said.

“They are also starting to replace those machines. They are signing contracts for $20 million — and it’s not only the sales, but the subsequent business of supplying parts for the machines,” he said. “So the Chinese are beginning to take this piece of the market away from the Americans.”

Chinese companies also are building oil refineries, pipelines and production facilities. Officials in Beijing have boasted that they helped Sudan change from an importer to exporter of oil.

U.S. companies traditionally had been among the most active foreign investors in Sudan. Their fortunes, however, worsened when relations between the two countries began to deteriorate after the 1991 Gulf war, during which a fundamentalist Islamic government in Khartoum supported Iraqi dictator Saddam Hussein.

In the early- and mid-1990s, Sudan provided refuge to some of the world’s most-wanted terrorists and criminals, including Osama bin Laden, Carlos the Jackal and Abu Nidal. Because of its support for those and other extremists, it was blacklisted by the State Department as a state sponsor of terrorism in 1993.

In 1996, the U.S. Embassy in Khartoum was closed, and a year later, Washington imposed economic, trade and financial sanctions. The embassy reopened last year, but with only a skeleton staff.

The United States succeeded on July 30 in passing a U.N. Security Council resolution giving Sudan 30 days to rein in and start disarming the Janjaweed Arab militias responsible for tens of thousands of deaths and millions of refugees in Darfur.

At the end of that period, U.N. Secretary-General Kofi Annan is to report to the council on the government’s actions. A negative report will open to door to measures against Khartoum, such as diplomatic, economic and travel sanctions.

But hardly anyone expects those actions to come close to the severity of the U.S. sanctions, which means they will have no effect on most of the foreign companies’ business. An oil embargo is the only punishment that would make a real difference, diplomats say.

“Unless it is credibly threatened with painful sanctions, such as an oil embargo, the Sudanese government will make no serious attempt to ease the plight of its black African citizens,” Britain’s Economist magazine wrote earlier this month.

China, a permanent Security Council member, is not likely to vote for an oil embargo or any other meaningful sanctions, council diplomats said.

“The best we can hope for from the Chinese is an abstention,” one diplomat said.

Chinese officials, when accused by the West of turning a blind eye to Sudan’s human rights abuses, say, unlike the United States, they separate politics from business.

However, that rule seems not to apply to countries that recognize Taiwan’s independence, Western diplomats point out. Beijing considers the island part of China and turns its back on states that differ.

In addition, Beijing, whose own human rights record often is criticized, maintains that punishing Sudan economically would be interfering in its internal affairs.

China is Sudan’s largest trading partner, according to the CIA World Factbook, followed by Japan, Saudi Arabia, India, Britain and Germany.

Although the Europeans are more likely to support the United States, they have been slow to respond to the Darfur crisis with any specific and credible threats. Several European airlines have regular flights to Sudan, and European companies are investing in a variety of sectors.

A German businessman, whose company hopes to build a new airport in Sudan, said during a recent Lufthansa flight from Frankfurt that shortage of money has never been an issue.

The Sudanese “may be slow in doing almost everything, but they are always on time when it comes to paying their bills,” he said.

U.S. trade sanctions have given trademark regulations in Sudan a whole new meaning. The leading hotel in Khartoum uses the Hilton name and logo even though it is not part of the well-known chain.

A little more creativity has been used to exploit the popularity of American food brands. Fast-food restaurants with the McDonald’s golden arches in front bear the name Lucky Meal. Pizza Hut has been replaced by Pizza Hot.

The Sudanese are not likely to experience the real thing again anytime soon, as a change of U.S. policy is nowhere in sight.

“Sudan is a state sponsor of terrorism, and Congress has mandated that there should be sanctions,” a senior State Department official said.

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