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US granted sanctions exemption to Sudan sugar factory: report

July 23, 2012 (WASHINGTON) – The inauguration of a major sugar plant in Sudan this month was made possible because of a decision by the US administration to grant a one-time exemption from the sanctions it imposed on the East African nation more than a decade ago, according to a newspaper report.

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A general view of the White Nile Sugar Co sugar plant in Al-Diwaim opned by Sudanese President Omer Hassan al-Bashir on July 11, 2012. (Rueters)

Last April, the Sudanese government was placed in humiliating situation when it was forced to cancel the highly publicised opening of the White Nile Sugar Factory at the eleventh hour due to the refusal of the company providing the plant’s software to release it citing compliance with US sanctions.

Sudanese officials and managers overseeing the project at the time were unaware that the company was recently bought out by another US corporation, forcing the abrupt move.

“They didn’t tell us, we just found out when we pushed the button,” Fareed Omer Medani, a senior executive with state-backed entity Kenana Sugar Company told the Financial Times newspaper.

Kenana has a 30% share in the $1 billion White Nile Sugar Company. Other owners include the Arab Authority for Agriculture Investment and Development, National Social Insurance Fund and Central Bank of Sudan.

President Omer Hassan al-Bashir ordered an investigation into the circumstances surrounding the incident and refused to accept the resignation of the industry minister Abdel-Wahab Mohammed Osman who held himself responsible for the delay.

The committee probing the event already transmitted its findings to Bashir but its contents have yet to be released.

This is not the first time the White Nile Factory’s opening was suspended after missing prior deadlines in November 2009 and November 2010 under two former industry ministers Jalal al-Digair and Awad al-Jaz.

The crucial software allows the factory to utilise satellite technology that engages machinery from thousands of miles away.

Ali al-Sayed Mokhtar, the managing director of the sugar plant, told state news agency (SUNA) this month that they got help from "free nations" to break the software’s code and even introduce enhancements to it.

But the Financial Times newspaper reported that a sanctions waiver license was granted to the software company after which the White Nile Factory was able to begin production. It gave no further details.

At the inauguration ceremony on July 11th president Bashir said the plant, which targets initial annual output of 150,000 tonnes, would help turn Sudan into one of the biggest sugar exporters.

"Sudan will be one of the more significant sugar-exporting countries" in the Arab and African region, he was quoted as saying.

Increased exports of sugar form part of the government’s plan to recoup revenue lost when South Sudan separated last year, taking with it about 75% of oil production.

The Sudanese leader also vowed that his country would stop doing business with "companies from nations hostile to Sudan". He added that Sudan has friends who can help and who share mutual interests.

"Our directives that no contract with companies of states boycotting Sudan because they seek to undermine our economy" Bashir said.

"Why do we allow countries boycotting us to make benefits?" he posed the question.

Sudan has been under US economic sanctions since 1997 and remains on the US list of state sponsors of terror. At the time, Khartoum harboured Al-Qaeda’s late chief Osama bin Laden.

After 2003 sanctions were tightened over the conflict in the Darfur region and human rights violations in other parts of the country.

(ST)