The next nine months are critical for Sudan. The 2005 Comprehensive Peace Agreement (CPA) sets January 9, 2011, as the date when southern Sudanese will vote on secession or unity, and the people of disputed Abeyei will vote on whether to be part of North or South Sudan. Between now and July 2011, when the provisions of the CPA come to an end, we could see the birth of the new country of South Sudan—or a return to a North-South war if the referendum is stalled, botched, or disputed. (Few currently expect that a unity vote will create the “New Sudan” envisioned by the late John Garang.)

Much remains unclear. The Referendum Commission for South Sudan is behind schedule and its work so far has been marred by disputes between members. Assuming the referendum does occur, while most commentators expect the vote to be for secession, it is not clear what will happen after the votes are counted.

Like Oil and Water

Since the summer, the National Congress Party (NCP) and Sudan People’s Liberation Movement (SPLM) working groups, with facilitation by the African Union, have been looking at key issues such as citizenship, security arrangements, international legal issues, and economic and natural resource issues, including oil, debts and assets, and water. However, no agreements have yet been reached.

The economies of North and South Sudan are entwined, particularly through oil, which is found predominantly (but not only) in the south. Oil is refined and exported from northern facilities in Khartoum and on the Red Sea. If South Sudan secedes, arrangements allowing for the free movement of people, goods—including oil—and capital between the two new states could create a “win–win” outcome for all.

In addition, if the referendum is credible and peaceful, both countries would enjoy considerable opportunities to increase the size of the shared “economic pie,” through new private-sector investment, particularly in oil, minerals, and large-scale agriculture.

Sudan is only beginning to tap its mineral and hydrocarbon reserves. Given the limited exploration to date, no one knows how big a producer of oil and minerals it will become, making the troubled state potentially an important strategic player for the global East as much as the West.

Sudan’s largest foreign investor, China, has provided diplomatic support to Khartoum and military aid, but although the PRC has gone on record as being in favor of a united Sudan, I question whether they would be willing to risk the tremendous amount of infrastructure investments they have made in another shooting war. In the last months, China has opened up a consulate in Juba and extended its contacts in the South.

What Comes Next?

Given the potential impact of instability on the troubled Great Lakes region to the south and the Horn of Africa to the east, the international community is anxiously awaiting the referendum, in hopes that it will go a long way towards stabilizing one of the world’s most troubled hotspots, instead of plunging it back into conflict.

No one knows if the political leaders, and the people of North and South, will take the bold actions needed to make this happen. Key developments that will indicate progress towards a peaceful solution include:

• Are voter rolls, polling arrangements, and election monitoring being put into place? Will there be external support to ensure the referendum goes well?
• Are the leaders of the NCP and the SPLM making joint (or at least matching) statements committing to a free and fair referendum and to good-faith implementation of its outcome?
• Are politicians publicly supporting the referendum process, and explaining what the referendum will mean for them and their communities?
• Are leaders from South Sudan making their public aware that even after secession, friendly and constructive relations with the North will be necessary and desirable?
• Are politicians from North Sudan providing their public with a road map for a changed country after the referendum, whatever the results?
• Is the international community – including the United States, China, and the other key states – singing from the same song sheet, loudly and often, publicly and privately, to encourage Sudan’s politicians to hold the referendum, run it fairly and implement the results in a collaborative and constructive way?
• Are framework agreements being reached on oil, citizenship, debts and assets, and other key issues?
• Are the remaining border issues being resolved?
• Are the two governments and the oil companies (which generate most of Sudan’s government revenues and export earnings), working together to ensure that oil production and export – and hence government revenues – continue unabated through the referendum period?

Indicators of a “lose-lose” outcome include not only negative answers to the questions above, but also:

• Increased militarization of the border;
• Increased border skirmishes;
• A racheting-up of hostile rhetoric from leaders and in the media;
• Fissures in the international community that weaken pressure on the parties to complete CPA implementation through a full referendum process; and/or
• Loss of political control by either the NCP or the SPLM (or both).

So what can the international community do?

• Keep focus on the issue: Build a noisy and active consensus around the importance of a free and fair referendum and full implementation of the outcome, whatever it is.
• Offer incentives and make credible threats to both parties to encourage this final step in implementing the CPA.
• Work on a “Plan B” that includes contingencies for a return to war, a humanitarian emergency (such as a mass movement of people south, or even repudiation of the CPA altogether.

Although in the end it will of course be the Sudanese who decide if and how a referendum is implemented, eyes are on China to see what role Khartoum’s most powerful investor will play in the coming months. More broadly it remains to be seen if the United States and China can come together over the shared interest of peace and stability in Sudan and whether that can be reflected in mutually reinforcing pressures from both powers.