Darfur Rally

Yesterday I wrote an article about a rally that will take place in front of Wall Street to try to raise awareness of the genocide in Darfur, Sudan. I was asked a very good question which, I'm embarassed to say, I did not have a very good answer. So I did the next best thing: I asked someone who knew!

Here is an e-mail I received today that was written last September. It has many facts and horrors. Please try to read it. It is a matter of life and death...literally.

A Divestment Campaign to Stop Genocide in Darfur
Posted by: ereeves on Dec 15, 2004 - 04:20 PM
News
How ordinary citizens can work together to bring pressure to bear on theNational Islamic Front regime in Khartoum, with the goal of halting genocide in Darfur and securing a completed a peace agreement with southern Sudan.

Eric Reeves
September 13, 2004
[see www.divestsudan.org]

Darfur, Southern Sudan, and the Moral Imperative of (Equity) Divestment:
Which companies and nations are propping up the Khartoum regime?

The National Islamic Front regime in Khartoum seized power by military coup in 1989, deposing an elected government in order to abort the most promising peace process since Sudan’s independence in 1956. Since the 1989 coup, the regime has ruled by means of tyranny, a ruthlessly efficient network of security services, and a brutal domestic policy that includes serial genocide. This illegitimate cabal of genocidaires, largely unchanged since 1989, could not survive long without the economic and personal financial benefits that derive directly from foreign investment.

Consequently, as genocide continues to unfold in Darfur, and a final peace agreement between Khartoum and southern Sudan remains in diplomatic limbo, a number of observers have begun to argue that there can be no moral justification for holding equity investments in the many European and Asian companies that are now propping up the Khartoum regime by means of large commercial investments and capital projects.

Perhaps surprisingly to many Americans, a number of these European and Asian companies list their shares on the New York Stock Exchange and are held in many mutual funds and pension funds. Others list on the London Stock Exchange or exchanges in other countries. Still others seek to enter the US bond market (debt market) in order to raise American capital to support their enterprises in Khartoum and northern Sudan.

How many companies are investing in Sudan in ways that provide the NIF regime with essential commercial and economic support? The list includes a good many more companies than those that have chosen to invest in the oil development sector recently high lighted by US Secretary of State Colin Powell. But all of these companies have chosen to accept payment in the form of Khartoum’s petro dollars---revenues raised from oil development projects located almost exclusively in southern Sudan, though presently used for purposes that in no way contribute to southern development.

Indeed, Khartoum’s extensive military purchases, especially over the last half dozen years, have been made possible by virtue of realized and anticipated oil revenues. These purchases include many of the helicopter gunships that have been deployed to such deadly effect against civiliansin both southern Sudan and Darfur. A measure of the profligacy of Khartoum’s military purchases can be seen in the recent completion of a deal with Russia for 10 MiG-29s---one of the most advanced fighter aircraft in the world.

A PRELIMINARY ROSTER OF COMPANIES SUPPORTING KHARTOUM
Good examples of especially culpable commercial presence in northern Sudan include Germany’s Siemens AG (listed on the New York Stock Exchange), presently building outside Khartoum the world’s largest diesel-powered electrical generating plan; Switzerland’s ABB Ltd (also listed on the New York Stock Exchange), now engaged in a huge project to upgrade the electrical grid for Khartoum and the surrounding urban areas, as well as in automation work for the major oil production consortium in Sudan, the Greater Nile Petroleum Operating Company; France’s Alcatel, a telecommunications giant, is yet another company that both lists on the New York Stock Exchange and offers commercial telecommunications support that benefits Khartoum, and the immediate environs of Khartoum; nothing benefits the rest of Africa’s largest country.

A successful divestment campaign against these companies, and their ethically myopic investments, would bring real, unsustainable economic pressure to bear on Khartoum. For its single goal would be to force a commitment by such companies to suspend all commercial activities pending the end of genocidal destruction in Darfur and completion of a final peace agreement with the people of the south.

There are other divestment targets as well, and bipartisan legislation recently introduced in the House of Representative (sponsored by Congressmen Franks, Lantos, Payne, Pitts, Tancredo) would legally require disclosure of “the identity of all entities that are engaged in commercial activity in Sudan” (Section 5 [a] of H.R. 5061, “To provide assistance for the current crisis in the Darfur region of Sudan and to facilitate a comprehensive peace in Sudan”; see below).

But some of these companies are especially conspicuous in their activities even now. Russia’s Tatneft is an important participant in Sudan’s oil sector (and also lists on the New York Stock Exchange).China’s contrived corporate entity “PetroChina” is essentially a capital market surrogate for China National Petroleum Corporation (CNPC), the dominant and most ruthless international player in Sudan’s oil sector. After Goldman Sachs failed in 2000 to secure a $10 billion Initial Public Offering for CNPC, the Wall Street firm created a so-called financial “cut-out,” which became the new entity “PetroChina”: it is PetroChina, wholly controlled and 90%-owned by CNPC, that lists on the New York Stock Exchange.

THE LOGIC OF A DIVESTMENT CAMPAIGN: IF WORLD LEADERS WON’T ACT, ORDINARY CITIZENS MUST
Why a divestment campaign? Why a relentless effort to ensure that hundreds of billions of dollars of stock (equity), held in various US pension funds, endowments, and mutual funds, are sold? There are two answers.

First, it is immoral to own shares in companies that now willingly engage in commerce with a regime that is guilty of ongoing genocide. Such investment is no different in character from investment in German industry during World War II and the Holocaust. However high the threshold might be for divestment---what will inevitably be labeled the“politicization of investment decisions”---genocide must surely cross it.

Secondly, there are precious few ways in which to bring meaningful pressure to bear on this brutal and intransigent regime. The UN Security Council gives no sign of imposing sanctions on Khartoum, and China has already made explicit threats to use its veto to ensure that no effective sanctions are contained in any resolution. China will have ample diplomatic support from Russia, Pakistan, Algeria, and perhaps others. The Arab League and the Organization of Islamic Conference have also made clear their opposition to any UN pressures on Khartoum. The US, despite Secretary of State Powell’s genocide determination last week, is already in the process of weakening a new Security Council resolution, accordingto Powell’s chief deputy, Richard Armitage (Agence France-Presse,September 13, 2004).

For despite a number of references by Powell during his September 9, 2004 Senate testimony to unspecified “measures” against Khartoum’s “petroleum sector,” he did nothing to suggest how these measures might actually be effected. Similarly, the European Union has spoken of sanctions, including an “oil embargo,” but with no clear indication of how the latter could be enforced. And indeed, with Sudanese crude refined mainly domestically and in East Asia, and completely without “Sudanese identity” once refined, it is not at all clear what intelligibility the notion of an “oil embargo” has. Moreover, the dominant players in Sudan’s oil development and production are the state-owned oil companies of China, Malaysia, and India, with a growing Russian presence. These countries are among the least likely to participate in an “oil embargo.”

In China’s case, we may be certain that there is no willingness to have any international pressure brought to bear on what Powell referred to as Sudan’s “petroleum sector.” China is now a net importer of oil, and petroleum consumption grows by over 10 percent per year (and China’s economy is especially sensitive to oil “price shock”); Sudan is China’s premier off-shore source of oil. There are simply no human rights concerns---even massive genocidal destruction---that will lead the Chinese regime to accept an embargo or any other threat to its production and development activities in Sudan.

But even Europe, despite apparently tough talk in some quarters, is still far from prepared to jeopardize its own economic interests. Germany is a case in point. German Development Minister Heidemarie Wieczorek-Zeul is reported today (September 13, 2004) as saying she “favours tough sanctions against Sudan.” ---

“The German minister said that contradictory promises from the Sudanese leadership had not help improve security in Sudan's troubled Darfur region where Arab militias are accused of carrying out a campaign of genocide. Wieczorek-Zeul recommended an arms and oil embargo along with the freezing of Sudan's assets.” (Deutsche Welle, September 13, 2004)

But notably, Wieczorek-Zeul says nothing about the German commercial presence in Khartoum, of the sort emblematized by giant Siemens AG: it is this presence that does so much to sustain the National Islamic Front and convince the regime that ultimately petro dollars speak louder than the cries of death and suffering in Darfur.

Moreover, there is again no discussion of how an oil embargo could be mounted, or what the point of a fig-leaf “arms embargo” is so long as Russia and China, as well as Ukraine, Bulgaria, Yemen, and a number of other countries are more than prepared to supply Khartoum all the weapons it can purchase with its exclusive control over Sudan’s oil revenues (exceeding $1 million per day).

Jan Pronk of the Netherlands, Kofi Annan’s special representative to Sudan, suggests in a different fashion just how far Europe is from responding meaningfully, and with a unified voice, to Darfur’s crisis. Pronk accurately declares of the Khartoum regime:

"‘I see a government here that just doesn't seem to be interested in its own people,’ Mr Pronk says in his hotel room in Khartoum.” (Radio Netherlands, September 13, 2004)

Even so, Pronk goes on to say that the failure of his report to generate any UN momentum for sanctions against Khartoum is of no real concern (of course this professed lack of concern works to support the political position of Kofi Annan, who is unable to guide the UN Security Council toward meaningful action):

“‘I'm not a great proponent of sanctions because I invariably see them as a sign of weakness. Sanctions are punitive measures, and you only punish people if their behaviour can no longer be influenced.’ In addition, China and Russia are likely to block any UN resolution authorising the dispatch of international peacekeepers to Darfur against the will of the Sudanese government. It's another reason why Mr Pronk feels that alternative avenues should be explored to up the pressure on Khartoum.” (Radio Netherlands, September 13, 2004)

These words have a specious plausibility, but mask a blunt truth: Pronk and Annan have no ideas about how to “influence” Khartoum’s behavior in any way commensurate with the urgency of genocidal destruction in Darfur. It is now almost two and a half months since Kofi Annan signed a “Joint Communiqué” in Khartoum (July 3, 2004), in which Khartoum committed to“immediately start to disarm the Janjaweed” and to “ensure that no militias are present in all areas surrounding Internally Displaced Camps.” Despite these and other security-related commitments, nothing has improved in the security situation in Darfur, the essential issue for terrified and displaced civilians, and for any possible political settlement. Pronk speaks of “alternative avenues [that] should be explored to up the pressure on Khartoum”---but of course he does nothing to spell out these “alternative avenues,” and the genocide continues.

(Perhaps it is worth recalling that the Dutch corporation Trafigura Beheer BV participated from the beginning in the sale and promotion of oil from Sudan’s major producing consortium in southern Sudan, the Greater Nile Petroleum Operating Company [see “The Netherlands to Ship Genocidal Oil” by this writer in Trouw, (The Netherlands), September 4,1999; English translation available upon request].)

Khartoum may not be happy with current world attention, but has yet to hear a clearly articulated threat---one that will change its behavior fundamentally. The regime seems to be banking on an eventual drifting of international attention, both away from the catastrophe in Darfur (which will become simply a chronic “humanitarian problem”), and from the unfinished business necessary to finalize a north-south peace agreement, including a comprehensive cease-fire with robust peacekeeping. In order to disabuse Khartoum of this notion, international pressure on the regime clearly must include both near- and long-term economic pressure and punishment, and a vigorous divestment campaign offers one means of achieving this.

DIVESMENT STATISTICS AND MECHANICS
US public pension plans alone own over $91 billion dollars of equity (shares) in companies like Siemens AG, Alcatel SA, ABB Ltd, Tatneft, PetroChina and a number of others. These pension plans include, for example, California Public Employees Retirement System, California Public Employees Retirement System, Colorado Public Employees Retirement Association, District of Columbia Retirement Board (DCRB), Florida State Board of Administration (FSBA), Maryland State Retirement & Pension Systems, State of Hawaii Employees’ Retirement System, Illinois State Teachers’ Retirement System (ISTRS), Pennsylvania State Employees Retirement System, The Retirement Systems of Alabama (RSA), New York State Common Retirement Fund, Vermont Municipal Employees’ Retirement System, State of Connecticut Trust Funds (SCTF), Ohio Police & Fire Pension Fund (OPFPF), State of Wisconsin Investment Board (SWIB)---andmany, many more.

Private US pension plans own many additional tens of billions of dollars of equity in companies that now work to support a regime engaged in genocide. And private US mutual funds have even greater equity exposure to these companies. Finally, college and university endowment investments will in most cases have substantial shareholdings, directly or through mutual funds, in a number of these companies.

While it is not presently possible to know with full accuracy which pension funds and mutual funds own which shares, and in which of these companies, it is certainly the right of every pension investor and mutual fund investor to make inquiries today. Much of the information is available in on-line prospectuses, and in other public sources.

Those with discretion over their investments (e.g., a choice of pension plans, a choice of mutual fund investments) should make clear a blunt demand: “divest, at a minimum, from all shares of Siemens AG, Alcatel SA, ABB Ltd, Tatneft, and PetroChina---or I will invest my money in a fund that does not hold shares that are ultimately a form of complicity in genocide.” Strong concern should be registered over the possibility that other foreign equities might reflect investments in Sudan

Here it should be borne in mind that because of comprehensive US sanctions against Khartoum, imposed in 1997, no American companies operate in Sudan.

For those in public pensions plans, and no option for alternative retirement investment, the message to pension managers should be clear and forceful: “I am extremely unhappy that my hard-earned dollars are being used to purchase shares in companies operating in Sudan and propping up a genocidal regime. I will register this unhappiness with public officials in this state (or organizational body), and with the news media, and with all who are in a position to force reconsideration of this investment.”

College and university students have a particular opportunity: to force institutional endowments to divest from all holdings (including through mutual funds) of Siemens AG, Alcatel SA, ABB Ltd, Tatneft, and PetroChina. During the apartheid era in South Africa, college and university students were an immensely powerful force in breaking down this hateful system of racial discrimination. Students now have an even more urgent task: to ensure that endowment monies are not invested in companies complicit in genocide---the deliberate, ethnically/racially-driven destruction of the African populations of Darfur.

Shares of these companies are also owned within the TIAA-CREF retirement funds (TIAA-CREF is the retirement investment vehicle for American higher education and is the largest private pension plan in the world). College and university faculty and administrators should vigorously lobby the management of TIAA-CREF to divest all shares of these companies, from all funds (for example, TIAA-CREF’s “Global Equities Fund” has shares in ABB Ltd, in Siemens AG [over 2 million shares], and in Alcatel SA [over 3.5 million shares]).

DIVESTMENT GOALS
Again, the central purpose of the divestment campaign must be to force these complicit companies to suspend all business and commercial activities in Khartoum until the genocide in Darfur ends and a final peace agreement with the people of southern Sudan is signed and implemented. If the UN, the US, and the European Union are unwilling or unable to bring serious pressure to bear on the Khartoum regime, then it is time to “take foreign policy private.”

URGENCY
The Abuja (Nigeria) peace negotiations have stalemated, with Khartoum holding out for disarmament and “cantonment” of the insurgency groups. The Sudan Liberation Movement and the Justice and Equality Movement, for obvious reasons, refuse to countenance disarmament and geographical confinement prior to a political settlement, or at the very least deployment of a very large international peacekeeping force with a robust mandate. To do otherwise is simply to make themselves defenseless targets of extermination attacks by the Janjaweed and Khartoum’s regular military forces.

Certainly genocidal violence and displacement continue, and have recently accelerated. Oxfam reports today (September 13, 2004) that very recent violence in South Darfur has led to tens of thousands of newly displaced persons:

“In recent days Greda camp has been overwhelmed by fresh arrivals fleeing renewed violence. On August 26 [2004] the camp housed approximately 10,000 displaced people, by September 7 the camp had boomed to over 40,000 people. People are still arriving every day at the camp. ‘Literally tens of thousands of people have poured into the camp in recent days and the flow still hasn’t stopped. A quadrupling of numbers puts a massive strain on resources and infrastructure.’” (Oxfam Press release, September 13, 2004)

And this is just one camp.

According to numerous UN reports and reports from humanitarian organizations on the ground, displaced women and girls continue to be raped in brutal, systematic patterns in and around the camps. Men cannot venture from the camps without the risk of beatings or execution by the Janjaweed.

Cholera and dysentery outbreaks continue to loom threateningly over these massively overcrowded camps, with explosive mortality a clear possibility. Clean water and adequate sanitary conditions are nowhere near adequate in many camps; some camps have no humanitarian presence whatsoever. Diarrhea, malaria, Hepatitis E, and growing malnutrition are taking ever greater numbers. The UN’s World Food Program was able to reach fewer than 1 million people in August; the target figure for September (another very rainy month) is 2 million---and this still understates global need in Darfur. Several rich European nations, including France and Italy, along with Japan and oil-rich Arab countries,have done pitifully little by way of responding to critically urgent funding needs for humanitarian assistance in Darfur.

Agricultural production has come to a halt, food reserves have been destroyed or exhausted, and the killing season has begun in earnest. And still Khartoum shows no signs of responding to any of the purported “pressure” by the international community. In particular, the regime adamantly continues to deny an appropriate mandate to the small African Union force desperately in need of massive augmentation. Such an expanded force, with a robust peacekeeping mandate, holds out the only near-term prospect for improved security in Darfur.

The time has come for ordinary citizens to make it impossible for this intransigently genocidal regime to enjoy the economic benefits of European and Asian commercial and economic support. Divestment from the equity (shares) of the most culpably guilty of these transnational companies is a moral imperative.

Eric Reeves
Smith College
Northampton, MA 01063
413-585-
e-mail Eric

This is why I continue to fight. These people have no voice. Please, give them yours. Call the White House at (202) 456-1111. Call the House and Senate at toll free (877) 762-8762. If you are a student, try to get an organization formed. You could name it Students Against Durfur's Genocide (SAD G) Thank you.