A power struggle in Sudan

This is an audio transcript of the FT News Briefing podcast episode: ‘A power struggle in Sudan’

Sonja Hutson
Good morning from the Financial Times. Today is Tuesday, April 18th, and this is your FT News Briefing.

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Apple rolled out a big new product yesterday and it wasn’t an iPhone. A biotech group with links to a blacklisted Chinese company plans to expand in the US. And fighting in Sudan continued for a third day yesterday.

David Pilling
The immediate danger is that this could spiral out of control and become something like a civil war.

Sonja Hutson
The FT’s Africa editor, David Pilling, will tell us who’s behind the violent power struggle. I’m Sonja Hutson, in for Marc Filippino, and here’s the news you need to start your day.

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IPhone maker Apple yesterday rolled out a savings account together with investment bank Goldman Sachs. It offers US savers 4.15 per cent interest. That’s more than 10 times the average US savings rate. So it’s a big threat to traditional banks, which have been struggling with deposit flight. Customers have been yanking their money and putting it into money market funds or Treasury bills that pay better returns. Yesterday, three large US banks, Charles Schwab, State Street and M&T, reported a combined $60bn in deposit outflows in the first quarter of this year.

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A Chinese company that makes gene sequencing machines plans to expand in the US. But analysts are concerned because this company, it’s called MGI Tech, used to be a subsidiary of a Chinese biotech group called BGI. And BGI has several companies on the US government’s blacklist. Here’s the FT’s US pharmaceutical correspondent Jamie Smyth.

Jamie Smyth
So MGI have told us that it is a completely different company from BGI. They have also said that their machines, which they’re selling in the US, will never send the data from Americans back to China. They say the laboratories, the research institutions that they are working with are able to take the machines off the internet and be run completely independently. While MGI is trying its best to completely distance itself from BGI, there are still certain links. For example, Wang Jian, the founder of BGI, owns a 47 per cent stake in MGI. So that does suggest that there is still some linkage between the two companies.

Sonja Hutson
Jamie, what do these machines do and why does the US government think they could be a threat?

Jamie Smyth
So these gene sequencing machines are really very useful tools. And probably the best example of their use is how they help scientists to understand and diagnose disease. And they can even be used to develop new medicines to target particular diseases such as cancer. But there are concerns that if hostile actors, hostile governments were able to get hold of the personal genetic data of Americans, that this could be used by the military or the government in China to in some way hurt or potentially develop ways to target people in the US in a negative fashion.

Sonja Hutson
So Jamie, MGI was owned by BGI until it was spun-off into a separate company. How common is this to spin-off a subsidiary and then enter the US market?

Jamie Smyth
So some analysts say, have said, that this is actually quite a common modus operandi for the Chinese companies who have maybe got into trouble with the US government. What they’ve done in the past is that they have spotlights different companies from their parent, you know, that might have been put on entity lists or these blacklisted and they’ve tried to brand them differently so they can continue operating in the US and remain on sanctions. So there does seem to be some concern that this has been a pattern with some Chinese companies.

Sonja Hutson
That’s the FT’s US pharmaceutical correspondent Jamie Smyth.

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Fighting in Sudan continued for a third day yesterday.

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Nearly 100 people have died, mostly in the capital, Khartoum. The clashes between the president, who also leads the army, and the head of a rival paramilitary group who’s also the president’s deputy. They’re the same two men who teamed up a few years ago to overthrow Sudan’s dictator Omar al-Bashir.

David Pilling
They have held a kind of unsteady, wobbly peace for the last four years that broke down this weekend. And they’re now going hammer and tongs at each other.

Sonja Hutson
Our Africa editor, David Pilling, told us more about this power struggle.

David Pilling
The two people involved are the head of the army and the de facto president of the country, General Abdel Fattah al-Burhan and his deputy, the vice president, Lt General Mohamed Hamdan Dagalo, who is better known as Hemeti. And Hemeti has been in charge of a paramilitary force, the Rapid Support Forces and the head of the army, Burhan, had been pushing to bring the paramilitary force into the armed forces, which you could see as an attempt to kind of neuter it. They’d been haggling over a timetable for this, and that haggling appears to have triggered one or other of the sides to decide that enough of this kind of shadowboxing and that they would unfortunately go for the real thing.

Sonja Hutson
David, is this just a struggle for power or are they fighting for some economic gain too?

David Pilling
I think both. I mean, power can often lead to wealth. The armed forces around various businesses in the country and Hemeti himself has control of gold mines and particularly in the west of the country and other business interests. So together and separately, they do have business interests. If there were ever to be a transition to civilian rule, which of course looks highly unlikely now, but if that were ever to happen, I think those business interests would be questioned, let’s say, and many questions would be asked about the legitimacy and transparency of those. But it looks as though each one wants to keep hold of their interests, and there only appears to be room for one of them at the moment in Sudan.

Sonja Hutson
This is a domestic conflict, but other countries have interests in Sudan. Can you talk about who else is involved here?

David Pilling
When Bashir was kicked out in the coup in 2019, I think a lot of the surrounding countries sort of recalibrated their relationship with the new government that emerged headed by Burhan and Hemeti. So the UAE and Saudi Arabia, I think, saw an opportunity to pay for the new government and therefore to influence it. I think above all, they wanted stability. They were worried about potentially Islamist forces, for example, rising up. I think any transition to democracy was potentially troubling for them. There are other powers involved as well, principally Russia, which is also close to Hemeti, particularly in his business interests related to gold. So you can see that there are regional potentially competing interests in a country that is very large and which has a strategic coastline on the Red Sea coast and which borders many other countries in Africa.

Sonja Hutson
We should remind listeners that despite all this violence we’re seeing after Bashir was ousted in 2019, there was a tremendous widespread movement for civilian rule, for democracy. What does this fighting mean for those efforts?

David Pilling
Well, I think the immediate danger is that this could spiral out of control and become something like a civil war, which would obviously put back any transition to democracy by years. It was always highly optimistic to think that military leaders of a country who had toppled a previous military leader, who have murky business interests and a difficult past in terms of their human rights, alleged massive human rights abuses in the Darfur conflict, for example, in the case of Hemeti that they would yield power willingly to a civilian government that could then presumably lorded over them, perhaps even send them to The Hague for trial.

Sonja Hutson
David Pilling is the FT’s Africa editor. Thanks, David.

David Pilling
Thank you so much.

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Sonja Hutson
Before we go, the Japanese company behind Sonic the Hedgehog launched a bid for Angry Birds.

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Sonja Hutson
Sega Sammy is offering nearly $800mn for Finnish company Rovio, which created the wildly popular game catapulting birds into various structures.

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Sega Sammy says it sees the global gaming market expanding to more than $260bn over the next few years and that more than half of that will be mobile gaming. Analysts said that Sega Sammy’s ambition is to build a super game like Fortnite or Minecraft. Maybe it’ll be called Angry Hedgehogs.

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You can read more on all these stories at FT.com. This has been your daily FT News Briefing. Make sure you check back tomorrow for the latest business news.

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