KHARTOUM, Sudan, Oct. 20 — To understand Sudan’s defiance toward the world, especially the Western world, check out the Ozone Café.
Here young, rich Sudanese, wearing ripped jeans and fancy gym shoes, sit outside licking scoops of ice cream as an outdoor air-conditioning system sprays a cooling veil of mist. Around the corner is a new BMW dealership unloading $165,000 cars.
“I tell people you only live this life once,” said Nada Gerais, a saleswoman.
While one of the world’s worst humanitarian crises continues some 600 miles away in Darfur, across Khartoum bridges are being built, office towers are popping up, supermarkets are opening and flatbed trucks hauling plasma TV’s fight their way through thickening traffic.
Despite the image of Sudan as a land of cracked earth and starving people, the economy is booming, with little help from the West. Oil has turned it into one of the fastest growing economies in Africa — if not the world — emboldening the nation’s already belligerent government and giving it the wherewithal to resist Western demands to end the conflict in Darfur.
American sanctions have kept many companies from Europe and the United States out of Sudan, but firms from China, Malaysia, India, Kuwait and the United Arab Emirates are racing in. Direct foreign investment has shot up to $2.3 billion this year, from $128 million in 2000, all while the American government has tried to tighten the screws.
“Khartoum is hot — in all ways,” said Hashim Wahir, chairman of Petronas Sudan, a branch of the Malaysian national oil company.
It was 115 degrees outside, but Mr. Wahir was also talking about business.
As long as Asian countries are eager to trade with Sudan, despite its human rights record, the American embargo seems to have minimal effect. The country’s president, Omar Hassan al-Bashir, keeps demonstrating his disdain for the West by refusing to allow United Nations peacekeepers into Darfur, despite continued bloodshed and pressure from the United States to let the peacekeepers in.
“The government knows it doesn’t need America,” said Abda Yahia el-Mahdi, a former finance minister, now in private consulting. “The only people who are being hurt by the sanctions are the Americans, who are missing out on this huge boom.”
The wealth is hardly evenly shared, and much of Sudan, like Darfur, remains desperately poor. Indeed, the nation’s per capita income was only $640 in 2005, at market exchange rates, according to the World Bank.
But the country’s G.D.P. grew 8 percent in 2005, according to the International Monetary Fund, and is predicted to increase by 12 percent this year. Cotton and other agricultural products have traditionally been the engines of the economy here, but the new growth comes largely because Sudan has substantially increased its crude oil production to 512,000 barrels a day — a drop compared with Saudi Arabia’s or Iran’s, but enough to bring billions of dollars to a country that until recently was one of the poorest on earth.
“Oil and real estate investment, primarily in urban areas, is really what’s driving the economy,” said Michael Kevane, an associate professor of economics at Santa Clara University. “There’s no doubt about that.”
The boom is also strengthening the government’s hand at home. Over the past few years, Mr. Bashir has been on an infrastructure binge, pouring hundreds of millions of dollars into roads, bridges, power plants, hospitals and schools, projects that tend to boost any government’s popularity. Mr. Bashir seems to desperately need it, with many people across the country, not just in Darfur, openly rebelling against his rule.
Mr. Bashir, an army general, seized power in 1989 through a military coup, and among the biggest beneficiaries of these boom times have been his troops. Ms. Mahdi said more than 70 percent of the government’s share of oil profits is spent on defense. A government priority is to manufacture guns and ammunition domestically, in case external supplies are cut off.
Despite all the new materialism, Sudan still marches to a martial tune. Army officers enjoy special status, foreign visitors must register with the police and schoolchildren are required to wear camouflage uniforms to class. But the boom is changing much about society, from the careers people pursue, to the music they listen to, even what they eat.
The traditional meal of ful, a bean stew eaten for breakfast and lunch, is giving way to kebabs, yogurt, hamburgers and hot dogs.
“We even have Pringles,” said Mohammed Abdelwahab Salih, a 26-year-old entrepreneur who recently started a business in Khartoum designing Web sites.
Mr. Salih remembers the days, not so long ago, when he used to have to wait in line for hours for a single loaf of bread.
“And it wasn’t even good bread,” he said. “When we got home, we had to pick out the flies.”
For years, the Sudanese economy was a disaster, with triple-digit inflation, moribund industries and war. Ever since Sudan’s independence in 1956, Christian and animist tribes in the south have rebelled against Muslim rulers in the north.
Oil had been discovered here by Chevron in the 1970’s, but the oil fields straddled the north-south divide and were essentially unworkable while the fighting was going on.
The American government imposed a trade embargo in 1997, freezing Sudanese government assets in the United States and cutting off its exports to and imports from Sudan, with a few exceptions. The reason: human rights abuses connected to the north-south war and Sudan’s links to terrorists. Osama bin Laden lived in Khartoum in the 1990’s.
But by 1999, when the first trickle of oil began to flow out of Port Sudan, on the Red Sea, Sudan’s economy was turning around. A small cadre of Western-educated technocrats had followed the I.M.F.’s reform programs to the letter — cutting spending, privatizing state-owned businesses, lowering inflation and pushing infrastructure.
“It was classic, conservative economic policies,” said Safwat Fanous, chairman of the political science department at the University of Khartoum. “And it worked.”
Even World Bank economists have been impressed.
“These are very good people managing the economy and would rate among the best anywhere in Africa,” said Asif Faiz, country manager for the World Bank in Sudan.
But, he added, they need to do more to spread the wealth to rural areas and focus on the poor.
Sudanese living abroad began to drift back, drawn by new opportunities — and other realities.
“If you want to open a bank account in America these days, it’s not difficult, it’s impossible,” said Ahmed Amin Abdellatif, a 33-year-old Cambridge-educated businessman who drives a Porsche SUV through the dusty streets of Khartoum and runs an empire of electronics shops. He argued that antiterrorism laws in the West had made it very difficult for him as a Sudanese citizen to do business. “Why go through the headache?” he added. “Why not put your money somewhere where it’s welcome?”
In 2002, Sudanese investors opened a new Coca-Cola factory, with Coke syrup legally exported to Sudan under an exemption for food and medicine. The $140-million plant churns out 100,000 bottles of Coke, Sprite and Fanta per hour, and factory owners have even adopted liberal employment policies, giving jobs to deaf women along the assembly line.
All this new investment is literally redrawing Khartoum’s skyline. Four years ago, the Libyan government began building a 24-story, five-star hotel on the banks of the Nile. The hotel is nearly finished and boasts a level of luxury unknown in Sudan until now — it has an indoor pool, squash courts, an espresso bar and spa.
In 2004, the first proper mall arrived in Khartoum, brought by a Turkish company, complete with a Wal-Mart-size megastore called the Hypermarket. It is place where men in white robes and women covered in black head to toe pluck toilet paper, dates and Pepsi from the shelves as Sudanese elevator music plays in the background.
In 2005, many people here hoped the American sanctions would be lifted and the economy would hit warp speed after Sudan’s leaders, coaxed by American mediators, made peace with southern rebels. But by that point the conflict in Darfur was raging, and relations with the United States only turned frostier.
“We felt like the Americans betrayed us,” said the Sudanese foreign minister, Lam Akol.
Still, Sudan had already learned to rely on the East, and because of oil exports, the economy had gained a stable momentum of its own. Inflation is now 6 percent; investment and development are reaching beyond downtown Khartoum to Sudan’s central agricultural belt and to Juba, the main city in the south.
But Sudan is a huge country, Africa’s largest, at nearly a million square miles. Enormous swaths of territory are still neglected, and growing class differences could sow the seeds of further unrest. Rebel groups in Darfur and other areas, eager for their share of oil profits and power, pose another problem.
Business leaders say the biggest danger would be if the United States succeeded in persuading Sudan’s Asian and Middle Eastern trading partners to join the boycott.
“The Americans are not a threat, but if the international community lines up against us, ahh, that is a different issue,” said Osama Daoud Abdellatif, chairman of the DAL Group, a conglomerate that owns the Coke factory, the Ozone Café and a number of other businesses. “Everything has been going so well, but Darfur could spoil the party.”
Link to this story