South Sudan fails to commit on Ugandan traders’ $40m dues

What you need to know:

Payment has remained in limbo over failure to secure Juba’s undertaking on the debt.
Under the agreement, the money was to be paid in five instalments but Juba apparently paid only the first instalment of $15million.
The youngest country in the world has been plagued by conflict since it gained independence from Sudan in 2011.

The government of South Sudan has failed to commit to reimburse the government of Uganda for compensation of traders for losses incurred after the breakout of fighting in 2013.

While the Ugandan parliament approved the compensation of at least $40 million (Ush150 billion) to some ten companies that the government said had been verified, the payment has remained in limbo over failure to secure Juba’s undertaking on the debt.

The ten are mainly grain suppliers and transporters. Parliament was told in March and April, when the list was presented, that verification of other companies was still ongoing and the compensation claim was expected to rise to Ush450 billion ($120 million) or more.

Uganda’s Minister of State for Finance in charge planning, David Bahati who presented the list to Parliament early April says payment plans have been complicated by Juba’s failure to commit.

In March 2016, President Yoweri Museveni wrote justifying the payment; “the government can continue with its efforts to recover the money from South Sudan government. The fund should be run transparently so only people authenticated by the South Sudan government are to be paid.”

The 10 companies, under the Uganda South Sudan Grain Traders and Suppliers Association, supplied maize and sorghum to 10 South Sudan states under the Strategic Grain Reserve for $56m (Ush205 billion) between 2008 and 2010.

Agreement

Under the agreement, the money was to be paid in five instalments but Juba apparently paid only the first instalment of $15million.

The youngest country in the world has been plagued by conflict since it gained independence from Sudan in 2011.

The claims relate to supplies from as early as 2008, when the country enjoyed relative peace following the signing of a comprehensive peace agreement in 2005 that paved the way for a referendum in 2011 that resulted its birth as an independent country.

While the independence opened new opportunities for traders and exponentially grew Uganda’s trade with her new neighbour to the north, internal political disagreements soon scattered the gains especially the outbreak of civil war in December 2013 that sent Ugandan traders scampering for dear life.

Traders counted losses and soon turned to their home government in Kampala in a bid to recoup some of their losses.

The two main warring factions in South Sudan have over the last months signed a series of accords aimed at returning stability to the country.

President Salva Kiir and main nemesis former vice president Riek Marchar signed the latest a final peace deal in September.

The pact opened the way for Dr Machar’s return to Juba October 31 to participate in a peace ceremony after at least three years of self-imposed exile in South Africa.