South Sudan to Compensate Three Ugandan Local Companies

Three Firms to Receive Compensation for South Sudan Debt
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The Ministry of Finance is set to provide compensation to three local companies on behalf of the Government of the Republic of South Sudan (GoRSS) as part of a long-standing compensation dispute. The compensation claims by these companies amount to a total of approximately $23 million, although it remains unclear how the figure of $190 million was determined in the agreement.

The three companies involved in this compensation deal are Dott Services Limited, Tomosi’s Farm Bwesharire Limited, and Ranway Petroleum Company Limited.

Dott Services Limited, known for its involvement in civil contracting for road projects, has ties to high-ranking government officials. Tomosi’s Farm Bwesharire Limited is owned by businessman Odrek Rwabwogo and his wife Patience Museveni. Ranway Petroleum Company Limited, which is not on the list of companies originally claiming compensation, failed to repatriate funds from its bank accounts in Juba.

This agreement, signed in September 2023 between the finance ministers of Uganda and South Sudan, reveals the existence of a sovereign guarantee issued by GoRSS in September 2021, worth $190,378,068 (approximately UGX 713 billion). This guarantee was not previously made public.

Finance Minister Matia Kasaija declined to comment, and the Finance Ministry spokesperson, Jim Mugunga, was unavailable for comment at the time of reporting.

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The compensation claims date back to 2010 when local firms sought government assistance to recover money owed to them by GoRSS for grain supplied to South Sudan. Negotiations led to a Memorandum of Understanding in 2010, acknowledging a debt of $56.4 million, with only partial payments made. The outbreak of a civil war in South Sudan in 2013 further complicated the situation.

In 2015, new claimants emerged, leading to the negotiation of a bilateral agreement between the governments of Uganda and South Sudan in 2016. The agreement stipulated that Uganda would loan the $41 million owed to grain traders to GoRSS, with a sovereign guarantee provided. Additional claimants were added to the list, pending verification.

The recent addendum to the agreement has raised questions, as it places the three companies at the forefront of the compensation queue. The selection criteria and the substantial increase in compensation amounts are unclear.

The total claims by the three companies, according to a parliamentary select committee report, amount to under $23 million, significantly less than the $190 million specified in the addendum. Questions also arise regarding the inclusion of Ranway Petroleum Company Limited, a company incorporated after the civil war began.

Despite the uncertainty surrounding the compensation deal, the Government of South Sudan has not yet reimbursed the funds lent by Uganda. The matter continues to be a subject of scrutiny and debate.

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