South Sudan has conceded to pay US$49.3 debt to Yu Sung Construction, a firm associated with former Lugari MP and one-time cabinet minister Cyrus Jirongo. This is following a case that was heard and determined in the East African Court of Justice at Arusha, Tanzania. MS Semuyaba, Iga and Company Advocates one of the legal representatives, had requested the government of South Sudan to give a consent order to settle the amount in four installments.
The firm had been awarded a tender to construct Sudan People’s Liberation Army infrastructures whose unpaid debt interests had been burgeoning for nearly a decade. The construction of Dr. John Garang Memorial Military Academy, four warehouses and fuel depots began in 2007 and ended in 2011 with the unpaid debt of US$18.6 million whose interests have accumulated up to US$49.3 million, the amount to be paid.
That is Sh4.9billion as at the time of the court ruling. According to the Consent Order dated November 26 2020 and
addressed to the East African Court of Justice, the debt will be paid until September 2021.
Cyrus Jirongo
“We have a pleasure to kindly request your honourable court to file a consent order of the payment of US $49,398,473.91 in four installments,” read part of the request. Debt servicing will start this month with the first installment being US$10.9 million, that is Sh1.09 billion from December 15, 2020, and end on September 30, 2021.
Through MS Semuyaba, Iga Advocates from Kampala along with Lumumba and Lumumba Advocates from Kenya, Yu Sung Construction Limited had dragged the South Sudan government to the regional court in November 2019, seeking payments of the nine-year-old debt. Jirongo served as a cabinet minister in the former president Daniel Arap Moi, is associated with Yu Sung, an international construction firm. The consent order was granted to the law firm by Biong Pieng Kuol Arop counsel for the South Sudan Ministry of Justice and Constitutional Affairs.
The Arusha-based court has a treaty and protocol on the enhanced jurisdiction of the court with regard to the enforcement and enhancement of trade and resolution and settlement of disputes for the protection of cross-border investments. In September 2011, two months after South Sudan had been inaugurated as a country, the SPLA terminated the contract with Yu Sung when the total debt was US$18,609,595 attracting an interest of US$2,791,439.25 per annum.
The late John Garang
The lawyers had implored presiding Judge Justice Munica Mugeyi to issue conservatory orders to freeze and settle the deposit of the sums, which would be put in an interest winning account until the hearing and determining of the case. The orders affected over 20 crude oil cargos of South Sudan, Dr. John Garang Memorial Military Academy and Natinga Warehouses worth US$700 million until the hearing and determination of the case.
The applicant also submitted that South Sudan authorities changed the construction of Dr. John Garang Memorial Military Academy to four different sites, causing friction in the construction process. “At Rajaf in South Sudan, after foundations were laid, the locals staged a resistance against the SPLA construction and the project had to be moved to a second site,” the submission said. The SPLA authorities chose Kurmork, which unfortunately proved to be prone to flooding after foundations had been laid and some buildings already at an advanced stage, according to the submission.
The project owners chose a third site in Mangalla country near Juba-Bor Highway which also came to be prone to flooding of the Nile and the project was moved to Suleng, 75 kilometres away in the northeast of the capital Juba.
The late Daniel Arap Moi
“The downpayment had been exhausted by 2009, causing labour unrest. We started selling off equipment to pay off the local labourers,” legal documents filed in court states. In 2011, a meeting led by Brig General Abuol Deng and Brig Gen James Hakim Elia, suggested the review of the contract but the idea was later trashed and Yu Sung was kicked out when the authorities owed them over US$ 18 million.
The debt has been accumulating in interests ever since bringing it to over US$49.3 million by September 2020. However, the South Sudan government acknowledged the fact that the ministry of Defence and Veterans Affairs was their agents and that they entered into contracts with Yu Sung on different dates for construction of some facilities, which were later defaulted.
The government admitted the fact that the claim has taken long without being settled the promises and commitments that are in vain hence need to fast track. “Recognising the fact that the failure and default of the respondent to uphold the contractual obligations it signed with the applicant may complicate the matter much more should the court’s proceedings be the only option left to the parties to follow,” Sudan minister for Finance and Planning Athian Ding Athian wrote while making a commitment on the payment of the said amount in a letter dated 26 November this year.
The letter was also copied to the minister of Defence and Veterans Affairs, Ministry of East African Community Affairs and Yu Sung Construction Limited.
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