Cruel Contrast: Oil Wealth, Malls and Poverty

May 17, 2007 — -- Travel to the Sudanese capital of Khartoum today and you'll find a city that is vastly different from the images of suffering the world sees from the country's Darfur region.

The old soukh in Omdurman used to be Khartoum's busiest market. Now it is giving way to a new Western-style mall, complete with high-fashion retailers and a bowling alley.

The capital's once famously unpaved roads have been replaced with new highways full of gleaming new cars.

The difference between these two regions is oil. Sudan has been riding a boom since it first started pumping oil in 1998. Today, all that new oil wealth helps many in the country's booming capital forget the suffering in Darfur.

"I think first of all politics and business should be separated," businessman Osama Abdul Latif told me.

Latif is building a brand new, $5 billion city center for Khartoum, which when finished will engulf what used to be the capital's most impressive landmark, the Hilton hotel, built by the United States.

"Obviously, American companies are losing out on all this work and I think it's a shame," Latif said. "But of course like anybody else, if you are put in a corner you have to find a solution."

China Delivers Investments, Restaurants to the Region

That solution is China. U.S. sanctions, which have been spurred in part by accusations of government-sanctioned genocide in Darfur, bar American firms from most business in Sudan, including oil. But Sudan has found an eager replacement in China, which now accounts for two-thirds of Sudan's oil exports. It is also providing some of the money for Latif's project.

The influence from China is visible across the capital. ABC News saw construction sites full of Chinese workers. We sampled one of several new -- and very busy -- Chinese restaurants. We also visited a school serving Khartoum's upwardly mobile professionals with Chinese language lessons.

China is even helping Khartoum's residents conquer the mighty Nile. For years, the only way for many resident to cross the river was by boat in sluggish ferries. But soon that's going to change. Next year, they'll be able to use a bridge going up, built by the Chinese and paid for with oil money.

Many believe oil money is also buying Sudan diplomatic cover. Beijing has blocked efforts to send peacekeepers to Darfur without Sudanese consent, prompting accusations that Beijing is abetting genocide. By some estimates, 80 percent of the Sudanese government's oil revenue goes to the military.

"The fact that Sudan has oil at a time when China needs it inoculates the regime to criticism," said Samantha Power, a professor at Harvard's John F. Kennedy School of Government and author of "A Problem from Hell: America and the Age of Genocide." "They are able to do what they want in Darfur in the knowledge and in the expectation that many countries around the world care more about extracting their natural resources than care about the crimes of the magnitude of genocide."

Only recently, under threat of a possible boycott of next year's Beijing Olympics, has China begun to relent, saying it might contribute a few hundred Chinese engineers to a possible joint U.N.-African Union peacekeeping force for Darfur.

Sitting in Khartoum's stylish new Ozone Café -- a popular meeting place for the city's young professionals -- I chatted with Milhal Gador, a 20-something woman employed by a Chinese-Sudanese joint venture.

"Do you think oil money is good for Sudan?" I asked her.

"Yes, if it is perfectly utilized but it's not like that now," she said. "The rural places outside of Khartoum need more in development."

But she, like many other Sudanese I met, sees China not as a villain but as an indispensable partner in her country's development.

"The Chinese, you know, they helped us when no one helped us," she said.

And China continues to help Sudan, while in Darfur the country's oil wealth remains a distant mirage.