3.2. Case study 2: Sudan and South Sudan
The case of Sudan and South Sudan provides another example of the achievements and limitations of Chinese PSCs’ work overseas. We look at both countries together because Chinese involvement in the region, which focuses mostly on the oil sector, dates back to the late 1990s, when oil-rich South Sudan was not yet independent. Chinese projects, infrastructure and operations in the region thus often span modern Sudan and South Sudan, from the oil producing fields straddling both countries to Port Sudan in Sudan. While neither Sudan nor South Sudan are officially part of the BRI, both governments are trying to make use of their strategic location near the Maritime Silk Road to attract Chinese investment. The Sudanese government in Khartoum, for example, has announced that it aims to turn Port Sudan into a free trade zone to support BRI.43
China-Sudan bilateral ties have become increasingly close in the past decades. Because of the massive exports of oil, China is now the largest trading partner of both Sudan and South Sudan. The Greater Nile Petroleum Operating Company, a joint venture between several oil companies established in 1997, with the China National Petroleum Corporation (CNPC) taking a 40 percent stake, marked the first large Chinese investment in Sudan. Today, China reportedly controls about 75 percent of the Sudanese oil industry.44
Security in the region has long been a problem. In October 2008, nine Chinese workers of the China National Petroleum Corporation (CNPC) were kidnapped in Sudan’s oil-producing state of South Kordofan; four of them were killed. And in late January 2012, rebels from the Sudan People’s Liberation Movement (SPLM)-North group kidnapped 29 Chinese workers from the state-owned China Power Construction Corporation in the same region.45 As a result, the number of Chinese nationals in the region has been declining. In 2012, just before the unveiling of the BRI and following South Sudan’s 2011 independence, there were over 12,000 Chinese workers in Sudan and South Sudan. By 2016, the number had dropped to under 7,000.46
While the security of oil installations was for a few years largely in the hands of South Sudan’s military, Chinese firms operating in the region, such as CNPC, have long used PSCs for further protection.
Neither Sudan nor South Sudan have clear laws or regulations restricting the operations of foreign PSCs in their territories. And arms control legislation in the region either does not mention PSCs, in the case of Sudan,47 or openly allows private security contractors to carry and use firearms as long as they have a license, in the case of South Sudan.48 According to a 2014 study, in South Sudan only one local PSC, Veterans Security Services (VSS), which is comprised mostly of former military regiments, had the legal right to hold arms, while other companies were required to contact local authorities if armed protection was needed.49 Whether this is still the case is unclear.
There is no open-source evidence of any Chinese private security presence in the country at the time of the first kidnapping incident of a Chinese national in Sudan in 2008. But by the time of the second kidnapping in 2012, the activity in the region of one of these companies was publicly recorded, although the specific company remained unidentified. According to media reports, armed contractors from this unnamed Chinese PSC – presumably hired by the China Power Construction Corporation – participated in the Sudanese army’s mission that resulted in the successful rescue of all 29 kidnapped workers.50
In July 2016, another Chinese PSC made headlines after getting involved in a skirmish in the South Sudanese capital of Juba. More details were publicly revealed in this case, showing that although Chinese PSCs in the region still tend to focus on security consulting, they can sometimes be dragged into combat scenarios for which they are unprepared. In this particular case, the PSC Beijing DeWe Security Services (DeWe) was called in to protect the employees of CNPC (its main client in the country) and to help evacuate 330 civilians to Nairobi, Kenya, after a shooting started between warring local factions. Reports of the incident show that DeWe employees were unarmed at the time and largely unprepared for this scenario. According to media reports, DeWe employees discovered in the middle of the firefight that the building they were based in “could not stop bullets”, and the evacuation of workers had to wait until the government forces had expelled the rebels out of the city.51 There were, however, no reported injuries or casualties and all civilians were eventually safely evacuated to Nairobi.
While it is not immediately obvious how many Chinese PSCs maintain a regular presence in Sudan or South Sudan, some of the largest Chinese PSCs are relatively open in admitting that they provide services in the region. In most cases, their clients are Chinese SOEs that remain involved in the two countries despite the political instability. The main player in the region is DeWe, which claims to have established a regional office in South Sudan52 and has also announced plans to build a permanent “security camp” in the country, in what appears to be the first overseas private security facility of its kind established by a Chinese company.
Other Chinese PSCs, such as VSS Security Group (伟之杰安保集团)53 or China Security and Protection Group also claim to provide services in the region.54 VSS, for example, whose main overseas client is PetroChina, reportedly had personnel on the ground in South Sudan in 2016.55 These companies, however, are substantially more opaque than DeWe so there is little publicly available evidence to substantiate these claims.
The examples of PSC activity in Sudan and South Sudan show that Chinese PSCs are very active in the region, and occasionally get involved in combat scenarios. Chinese PSCs, however, are not the only private security contractors operating in the region. International competitors, such as G4S and Control Risks, as well as private military firms like DynCorp or Academi (formerly Blackwater), also run missions in the area, mostly in South Sudan. Given the instability of both countries, competition for the private security market in Sudan and South Sudan is likely to increase in the future. The outcome of this competition, however, will most likely not depend on which PSCs are more effective or better prepared. Instead, it will depend on which international firms are willing to continue to invest in the region, despite the risk. As Beijing encourages Chinese SOEs to hire Chinese PSCs, and is also pushing for greater investment in the region through BRI, if Chinese firms expand their operations in Sudan or South Sudan, we can expect that Chinese PSCs will use the momentum of the growing Chinese involvement in the region to gradually increase their market share.
This is, of course, not a guaranteed outcome, as political conditions in the countries may change or non-Chinese oil companies may decide to invest in the region again, among several other factors. If current trends continue, however, we can expect to see a growing Chinese PSC presence in both Sudan and South Sudan.