Sudan, South to finalise talks 'by end-Sept'

JUBA (AFP) - South Sudan said Saturday it has agreed with the north to finalise talks on the key issues of oil, currency and borders by the end of September, after the first round of negotiations since independence.

"We have agreed that by September 30 we will reach a final agreement that will be the basis of the (economic) relationship between the two states," the south's chief negotiator Pagan Amum told reporters in Juba.

The agreement would cover the oil sector and the currency issue, Amum said after returning from Addis Ababa, where the African Union-mediated talks resumed this week following their suspension prior to southern independence on July 9.

The two issues had prompted Amum, who is the south's minister of peace and secretary general of its ruling party, the SPLM, to warn Monday of an "economic war" with the north, which he accused of imposing oil transit fees that amounted to "daylight robbery."

Around 75 percent of Sudan's total crude production of 470,000 barrels per day is pumped from the south.

Khartoum's cash-strapped government is desperate to offset the loss of southern oil revenues, which represented some 36 percent of its income prior to partition.

The north approved a law last week imposing fees on the landlocked south's use of northern oil infrastructure.

But on Saturday, Amum said Khartoum had agreed to charge pipeline transit fees "according to international standards."

The negotiating teams in the Ethiopian capital also discussed how the south and the international community would help Khartoum to recover its losses, which Amum said were about $340 million per month depending on oil prices.

The two sides launched new currencies in the past two weeks, and there have been widespread fears in Juba that Khartoum will refuse to buy back the estimated two billion old Sudanese pounds in circulation in the south and even flood the country with the old currency before it is withdrawn.

But Amum said on Saturday that the central banks from north and south had agreed to form a joint committee to replace the old Sudanese pound "in a transparent manner," to build confidence in the new currencies.