"Rolls-Royce exit drives pressure against Sudan"

Rolls-Royce exit drives pressure against Sudan
By Louise Watt
ASSOCIATED PRESS
Published May 3, 2007

LONDON
For groups hoping to stop the violence in Darfur with econo- mic
pressure, Rolls-Royce's announce-ment that it will withdraw from Sudan
was a milestone. Rolls-Royce PLC was high on a hit list drawn up by
activists who think foreign money is fueling a crisis that has killed
more than 200,000 people and driven 2.5 million from their homes. The
company, which supplies diesel engines to the oil and gas industry in
Sudan, announced last month that it was starting a gradual pullout.
Armed with the kinds of tactics that helped end apartheid in South
Africa a generation ago, the Sudan divestment campaigners think they
will succeed where politicians have failed. It is part of a growing
movement to bring citizen pressure to bear that fueled protests around
the world Sunday.
The campaign, focusing on the lucrative oil industry, is
pressuring certain companies to leave Sudan, where the government is
accused of arming Janjaweed militia blamed for widespread rapes and
killings of Darfur civilians. Campaigners also are encouraging
investors around the globe, from banks to retired teachers with
pension funds invested in companies doing business in Sudan, to take
their business elsewhere.
'Divest for Darfur'
In the United States, officials with the Save Darfur Coalition
announced the Divest for Darfur campaign on Tuesday, urging Fidelity
Investments and Berkshire Hathaway Corp. to cut off their
relationships with PetroChina Co., China's No. 1 oil producer and
known to be a major investor in government-owned oil exploration in
Sudan.
Anoushka Marashlian of Global Insight, an independent market
analysis firm, said Rolls-Royce's decision shows that companies are
worried about the negative publicity of conducting business in Sudan.
"I think at a private level [Sudanese government officials] are
worried this could produce a ripple effect and deter others from
Sudan," she said. "It doesn't necessarily mean they are going to amend
their conduct."
The U.S.-based Sudan Divestment Task Force began its campaign in
2005. The idea has been raised more recently in Europe. The new global
edge, activists say, has helped give it powerful momentum.
Four years of strife
"It is four years since the beginning of the Darfur crisis," said
Nick Donovan, head of policy and research at the United Kingdom-based
Aegis Trust, an independent organization that campaigns against
genocide. But the international community's approach of peacekeeping
and prosecutions in the International Criminal Court has failed to
stop the violence, he said.
"The government of Khartoum has never felt under sufficient
pressure," Mr. Donovan said.
During the anti-apartheid movement in South Africa, the African
National Congress and other campaigners called for an international
boycott of South African products as a form of protest. Mr. Donovan
said campaigners want something similar for Sudan, but also want to be
careful not to hurt ordinary Sudanese.
Instead of a broad boycott, the Sudan Divestment Task Force has
drawn up a list of about 50 companies to pressure to withdraw from
Sudan. Most are in the oil, energy and construction sectors.
Mr. Donovan said that 40 percent to 60 percent of Sudanese
government revenue comes from oil.
Oil revenue soars
From 1999 to 2005, the government's oil revenue rose from $61.1
million to $2.3 billion, according to the Aegis Trust. In the same
period, the Khartoum government's military expenditure rose from $248
million to $452 million, according to figures from the International
Institute for Strategic Studies in London.
Rolls-Royce was one of the "top dozen" targets of the divestment
campaign. The British company has not publicly acknowledged that the
campaign spurred it to withdraw, but cited "international humanitarian
concerns" in its decision.
"We just felt that this was the time to review the position and
that prompted the decision we made," said Martin Brodie, a company
spokesman.
French oil services company Schlumberger Ltd., another on the
activists' hit list, was discussing the nature of its involvement in
Sudan with the Sudan Divestment Task Force, said Schlumberger
spokesman Stephen Whittaker.
Maria Hamilton, spokeswoman for Lundin Petroleum AB, a Swedish
company on the list that is involved in exploratory drilling in Sudan,
argued that oil revenues are helping to rebuild the country. She noted
that war-battered southern Sudan, just emerging from its own war with
Khartoum, depends on oil revenue for reconstruction.
Spreading the word
Helped by the involvement of actors George Clooney and Mia Farrow,
and links between evangelical churches in the United States and
southern Sudan, 10 U.S. states and more than 40 universities have
agreed to divest their funds from Sudan, said Adam Sterling, task
force director.
Sudan Divestment UK started in November, and since then campaigns
have been initiated in Australia, South Africa and Italy, and are
being developed in Brazil, France, Germany and Malaysia.
There is an increasing awareness on the part of institutional
investors of what is going on, which comes from investors in the U.S.
approaching investors in the UK," said Ebba Schmidt, spokeswoman for
the UK Local Authority Pension Fund Forum.
Smuts Ngonyama, a spokesman for South Africa's African National
Congress, said divestment is a powerful weapon against apartheid, but
he could not say whether it would work in Darfur.
"Divestment is an important tool in any struggle to put pressure,"
he said. "But it is applied when all other means have been exhausted."