MA Thesis Economic Conditions in Peace Accords

Peace versus Peacebuilding
Which Role for Economic Clauses in Peace Accords?
Thomas Anthony
0100684
Utrecht University
July 2007
A Thesis submitted
to the Board of Examiners
in partial fulfilment of the requirements of the degree of
Master of Arts in Conflict Studies and Human Rights

Supervisor: prof. dr. ir. Georg Frerks Second Reader: dr. Chris van der Borgh
Date of Submission 19 July 2007
Word Count: 12973
Trajectory
Internship of 16 weeks (15 ECTS)
Research and Thesis Writing (15 ECTS; thesis of 10 000-12 500 words)

Table of Contents
Acronyms and Abbreviations 3
Chapter 1: Introduction 5
1.1. Introduction...........................................................................................................5
1.2. Structure......................................................................................................................... 9
1.2.1 The Case Studies...................................................................................................9
1.2.2 Outline.................................................................................................................11
Chapter 2: From War Economy to Peace Economy 13
2.1. Economic Reconstruction...................................................................................13
2.2. The War Economy: A Need for Reconstruction or Transformation?...........15
2.2.1 Incentives ............................................................................................................16
2.2.2 Physical and Non-physical Infrastructure...........................................................18
2.2.3 Social Cohesion...................................................................................................18
2.2.4 Governmental Institutions...................................................................................19
2.3. The Goals of Post-Conflict Economic Reconstruction ....................................21
2.3.1 Capacity Development........................................................................................21
2.3.2 Private Sector Development ...............................................................................22
2.4. Entry Points for Peace Agreements...................................................................22
Chapter 3: Peace Accords 27
3.1 Peace Accords and the Agenda for Peace..........................................................27
3.2 Peace Accords: Reasons for Success and Failure..............................................27
3.3 The Case for Inclusion of Economic Topics in Peace Accords........................29
3.2.1 Peace Accords: Peace versus Peacebuilding.......................................................30
3.2.2 Peace Accords: Intelligent Design versus Darwinism........................................34
3.2.3 Peace Accords: A Do No Harm Approach? .......................................................37
Chapter 4: Conclusion 41
Bibliography 45
Peace Accords 51
1

Acronyms and Abbreviations
BCPR Bureau for Conflict Prevention and Reconstruction
CPA Comprehensive Peace Agreement
DDR Disarmament Demobilization and Reintegration
DRC Democratic Republic of Congo
GDP Gross Domestic Product
GoSS Government of Southern Sudan
ICD Inter Congolese Dialogue
IPA International Peace Academy
JAM Joint Assessment Mission
MDTF Multi Donor Trust Fund
OECD Organization for Economic Cooperation and Development
SPLM/A Sudanese People Liberation Movement/ Army
SEA Agreement on Social and Economic Aspects and Agrarian Situation
UN United Nations
UNDP United Nations Development Programme
URNG Unidad Revolucionaria Nacional Guatemalteca
(Guatemalan National Revolutionary Unity)
3

Chapter 1: Introduction
1.1. Introduction
Over the past years the economic dimension of post-conflict reconstruction has been
increasingly brought to the fore. The number of publications in both academic and policy
circles bears witness to this trend. The Bureau for Conflict Prevention and Reconstruction
(BCPR) of the United Nations Development Programme (UNDP) for instance commissioned
a comprehensive study into post-conflict economic reconstruction which is due December
2007. Another in the line of many examples is the Memorandum on Post-Conflict
Reconstruction which was published in September 2005 by the Netherlands Ministries of
Foreign Affairs, Defence and Economic Affairs. This document specifically discusses the
needs of post-conflict states with regard
to economic reconstruction. As a
consequence of this increased attention it
has become clear that post-conflict
societies, even on the long-term, struggle
to achieve the level of economic
development known before the conflict,
let alone outperform their pre-conflict
economic achievements. (Woodward,
2002:184).
Staines has undertaken a quantitative study to further investigate the pace of
economic growth in post-conflict countries and comes with an important conclusion. Staines
shows that a marked difference exists between the post-war economic development of
countries that experienced wars that started before the 1990s and those that began during the
90s. The results of his study show that despite the fact that pre-1990 conflicts on average
lasted three times as long as post-1990 conflicts (12 and 4 years respectively), the impact of
war on the Gross Domestic Product (GDP) of these older cases was far milder than in the
case of the post-1990 conflicts. Although the trend shown in Figure 1 above seems to suggest
that post-conflict countries –and certainly those that experienced wars before the 1990s-
5

recover reasonably fast after the cessation of war, when GDP is measured per capita, a very
different picture arises. Figure 2 shows that for the older conflicts GDP per capita remains
around the same level and indeed shows a downward trend. For the more recent conflicts,
however, it takes an average of over ten years for GDP per capita to arrive at pre-conflict
levels.
Obviously, care should be taken
with these figures. The generalizations
made by quantitative approaches always
share the problem that the unique
characteristics of individual cases are lost
and extreme cases can thus have a
distorting effect on the group. This is
especially true with relatively small
amounts of cases such as the number of
civil wars. But even when a number of atypical cases is removed from the post-1990 dataset,
it takes an average of eleven years for real GDP to return to pre-war levels (Staines, 2004:
14). It is safe to conclude then that economic revival in post-conflict environments presents a
huge challenge.
The pervasive explanation of the strained economic performance of post-conflict
states is that the conditions in these states are hostile towards investment, not only of
international companies but, maybe more importantly, also by individual citizens. For
instance in a country where property rights haven’t been established farmers won’t borrow
money to buy the seeds required to plant long-term crops. In order to create the
circumstances conducive to investment and economic growth, post-conflict states need to
satisfy a great number of preconditions, perhaps most importantly a sense of security and
confidence. It seems obvious that one of the earliest opportunities to give a clear signal of the
new government’s intentions is at the time of negotiating a peace accord.1
By including
specific economic conditions in peace accords new states might be able to provide the first
building blocks of the security needed to influence investment decisions and thereby expedite
1
In this writing ‘peace accord’, ‘peace treaty’ and ‘peace agreement’ will be used interchangeably.
6

economic revival. However economic issues receive scant attention in peace negotiations and
are scarce in the formulation of peace accords.
The lack of attention to economic topics in peace accords becomes abundantly clear
in a study done for the World Bank and UNDP in 2007. This study analysed a total of
twenty-seven peace accords and found that although 81 percent of the agreements contained
some provisions relating to one of the state functions in the economic sector, the specificity
of these clauses was on average quite low (Suhrke & Wimpelmann, 2007: 24). Indeed Figure
3 above shows that most accords are found in the bottom left square. To mention just a few
examples; eleven of the studied agreements contained provisions regarding macro economic
policy, eight accords discussed social security and welfare and only one of the agreements
included a provision pertaining to property rights and contract laws. Compare this to the
twenty-five agreements that included provisions regarding elections, the twenty agreements
that discussed human rights and the twenty-three that adopted clauses with regard to security
sector reform (Suhrke & Wimpelmann, 2007: 21). The relative lack of economic clauses in
peace accords is mirrored by a lack of academic discussion regarding this issue.
Woodward comments that “there has been no systematic analysis of the contribution
of economic factors to the success or failure in the implementation of peace agreements.”
7

(2002: 183). The question that needs to be asked is of course why the possibility of including
economic conditions in peace accords receives so little attention.
There are a number of explanations, two of which will be briefly discussed. One of the
possible explanations for the lack of attention of economic issues in peace accords is given
elopment without autonomy in many countries is seen as part of the problem rather
than a solution. It has in many cases tended to benefit central government and members of the
The can
der pment as a complicating factor. In this
ssues that are among the root
be
shown
onomic development has grown enormously. The realization of
by Varennes:
“Economic development by itself does not figure prominently in peace accords, probably because
economic dev
majority and has thus exacerbated tension and contributed to a growing sense of alienation and
anger rather than contributed to peace.” ( 2003: 159-160)
question is however whether we should accept this claim. From its contents we
ive hat Varennes understands economic develot
view political and governance issues (such as the determination of autonomy) are what need
to be addressed in peace accords and a discussion of economic issues will merely make an
agreement harder to attain. This view in fact is too simplistic. Although it is seemingly
reasonable to suggest that economic development may have perverse effects, indeed this
view will be further discussed in the following chapter, it surely goes too far to thereby
conclude that economic issues should not be discussed at all. In fact, in the following chapter
it will become clear that economic development can have a tremendously positive influence
on the prospects of peace and stability in post-conflict states.
A second explanation is related to the function of peace agreements. It is argued that
the goal of peace accords should be to strictly resolve the i
causes of the conflict in stead of providing an agenda for post-agreement peacebuilding.
None of these explanations warrant the disbanding of further study with regard to
economic clauses in peace agreements. With regard to the first explanation it needs to
to what extent discussion of economic clauses might damage the prospects of success.
With regard to the second, more discussion is needed concerning the functions of peace
agreements. An important question being whether these accords should only be geared
towards the resolution of root causes or if they could also be effective as roadmaps for post-
conflict developments.
In conclusion it has become clear that since the 1990s conflicts have become shorter
but their impact on ec
8

econom
1.2. Structure
This paper will further scrutinize the relationship between peace agreements and post-
ic reconstruction. The main question that will be answered in this regard is
The case studies selected for this paper are the peace accords of Guatemala (1996), DRC
). But why these from the collection of 144 peace accords drafted
ic growth and development in post-conflict states is as difficult as it is necessary.
Despite the possible positive impact of including economic conditions in peace agreements
this topic goes without much discussion in both academia and practice. Finally, this lack of
attention warrants a thorough investigation of the possibility to include economic conditions
in peace accords.
conflict econom
whether peace agreements can and should adopt clauses to specifically facilitate post-conflict
reconstruction of the economy. Besides a depiction of the debates surrounding both
economic reconstruction and peace accords, this paper will integrate three case studies. The
cases that have been selected are Guatemala, Democratic Republic of Congo (DRC) and
Sudan. It is crucial to acknowledge that the analytical value of these cases is rather limited in
the sense that no final conclusions should be built upon the experiences of these countries.
Instead, the purpose of these limited case studies is to relate the theoretical debate to actual
cases. This fits into the general ambition of this paper. Due to its limited size this paper can’t
hope to settle the debate with regard to economic provisions in peace accords once and for
all. Given the fact that these topics go relatively ignored this paper can have a strong added
value in giving an introduction to the relevant issues and providing a first tentative
exploration of the challenges and possibilities of adding economic provisions in peace
accords.
1.2.1 The Case Studies
(2003) and Sudan (2005
between 1989 and 2005? (Harbom et. al., 2006: 624). There are a number of reasons for this
selection. First, in line with Staines, they represent old and new agreements. Secondly they
can be found in the top right corner of Figure 3 depicted above, which means that the three
accords include economic clauses with a reasonable level of scope and specificity which
promises to allow for more insight into the formulation of economic conditions. An
9

important error is of course that these cases were selected on the dependant variables in the
sense that the three peace accords have all included economic conditions and all agreements
are still in place thus far. This means that we can’t use these cases to argue for the conclusion
that adding economic conditions will increase the likelihood of peace, this underscores the
place that these case studies are given within this writing; they are used to provide more
insight, not final conclusions.
Guatemala (1960-1996):
The conflict in Guatemala had lasted for thirty-six years when a peace accord was finally
between the government and the National Revolutionary Unity
ay 1997 saw the rise to power of Kabila who ousted President Mobutu and changed the
ust 1998 his regime was challenged by a
signed in December 1996
(URNG). The root causes of the conflict were the high levels of economic inequality within
the Guatemalan society. The conflict caused the deaths of over 150 000 people and the
displacement of more than a million Guatemalans. Although the military strength of URNG
was very limited in 1996, the definitive end of violence was perceived as crucial to the
process of democratization (Stanley & Holiday, 2002: 421-425). Within the Guatemalan
Peace Accord, the Agreement on Social and Economic Aspects and Agrarian Situation
(SEA) is the most important document with regard to economic reforms and development; it
is this agreement that will the main focus for this paper.
The Democratic Republic of Congo (1998- 2003)
M
name of the country from Zaire to the DRC. In Aug
rebellion backed by neighbouring countries. The conflict in DRC was thus highly
internationalized. At the height of the war at least seven other African countries had troops in
DRC. Angola, Namibia, Zimbabwe and Chad aided Kabila while the rebels were supported
by Rwanda, Uganda and Burundi (Mangu, 2003: 159-160). The Lusaka cease fire agreement
in 1999 created the Inter Congolese Dialogue (ICD) which was meant to include civil society
and unarmed political groups in the peace process which could serve as the basis of a
transitional authority (Boshoff & Rupiya, 2003: 32). However the peace broke down and
Kabila was assassinated in 1999. His son Joseph Kabila revived the peace process which
resulted in the Pretoria Peace Agreement signed in December 2002. The conflict was
10

officially brought to an end in 2003 after the Final Act of the ICD resulted in the
establishment of a transitional government, the adoption of a transitional constitution and the
deployment of an United Nations (UN) force under Chapter VII of the UN Charter2
(Mangu,
2003: 163). According to a study undertaken by the International Rescue Committee almost
4 million people lost their lives to war-related causes (Coghlan & Brannon, 2006: 44).
Considering the extensive nature of the Final Act and its role in structuring the transitional
government, this paper will mainly make use of this document.
Sudan (1983-2005)
The second Sudanese war between the Sudan People’s Liberation Army (SPLA) and the
n was brought to an end by the Comprehensive Peace Agreement (CPA)
.2.2 Outline
This paper will first establish the possibility of incorporating economic conditions in peace
following chapter will therefore look into the specifics of post-conflict
ive an indication as to the relevance of including economic conditions. After a
Government of Suda
in January 2005. The CPA included provisions for sharing power and wealth, security
guarantees and the separation of state and religion for South Sudan. Moreover South Sudan
will hold a referendum in 2011 to decide whether it will become an independent state. The
conflict has cost the lives of over two million Sudanese, millions more were displaced as the
result of the war (Jooma, 2005: 1). Within the CPA the Wealth Sharing Agreement is
burdened with the task of deciding upon economic issues, it is this document that will be
used in this paper.
1
accords. The
economic reconstruction by presenting a typology of these environments. From this analysis
a number of priorities for reconstruction will be deduced and it will be shown how these then
may be incorporated in peace accords. The second chapter will conclude with the three case
studies and examine to what extent economic conditions were incorporated into the
agreements.
After having established the possibility of including economic conditions, the third
chapter will g
2
A Chapter VII resolution means a broader mandate for the deployed troops also known as ‘robust
peacekeeping’.
11

short depiction of the debates surrounding peace accords and peace implementation a number
of criteria will be studied that peace accords need to fulfil in order to establish the relevance
of adding economic provisions. The third chapter will then again turn to the three case
studies in an attempt to establish the impact of the economic conditions on peace and
economic development.
12

Chapter 2: From War Economy to Peace Economy
2.1. Economic Reconstruction
The overarching goal of post-conflict reconstruction is the prevention of renewed violence in
order to create the conditions necessary for sustainable peace and development. It is in this
light that economic reconstruction needs to be understood. As a result, the main objective of
economic reconstruction should be to remove the economic incentives for conflict (Del
Castillo, 2003: 13). These incentives can be divided into two basic categories.
The first covers incentives for conflict as the result of hampered economic growth.
Econometric studies undertaken by authors like Fearon & Laitin; and Collier & Hoeffler
(Collier & Hoeffler, 2004: 1126) show a negative correlation between the level of Gross
Domestic Product (GDP) and the likelihood of intrastate conflict. The higher the level of
GDP the smaller the possibility of conflict becomes. However, like any statistic correlation,
this should not be understood as a causal relation, for conflict isn’t caused by a certain
amount of income but by human behaviour that is partly influenced by it. This has caused
different authors to put forward a number of theories explaining the relation between the
likelihood of conflict and the level of GDP. Collier & Hoeffler, for instance, argue that a low
level of national income has an impact on the motivation of rebels to engage in violence as a
means to increase their income. Fearon & Laitin on the other hand contend that the level of
income mainly impacts the ability of the state to suppress rebel activity. According to them,
the chances of rebels to effectively wage an internal war increase when a state has relatively
limited means to combat this activity (Mack, 2002: 520-521). Despite these different
explanations of the interaction between GDP and conflict factors, economic growth is in
general understood as an important way to decrease the likelihood of armed conflict
(Goodhand & Cramer, 2002: 887).
The second way in which economic incentives tie into conflict is through disparities
in income among the inhabitants of a country. Pre-conflict states are often characterized by a
high level of income inequalities. Inequalities within states, especially when they occur along
ethnic, religious or racial lines can very much lead to tensions which can become
13

mobilisation factors for violence (Goodhand, 2004: 168; Gurr, T.R. 2001: 169,170; Le
Billon, 2000:5; Nafziger and Auvinen, 2002: 155,156).
Notwithstanding the intuitive validity of this point, quantitative research into income
inequalities has of yet not been able to find a strong correlation between inequalities and
violent conflict. An example of a way to measure income inequality is the GINI index, in this
index ‘0’ corresponds to perfect income equality (everyone has the same income) and ‘100’
corresponds to perfect inequality (all the income is earned by one person). Sierra Leone
experienced a conflict between 1997-1999 and had a GINI of 62,9 in 1989 which seems
significant. Guinea-Bissau which was in conflict between 1998 and 1999, had a GINI of 40,3
in 1994 and Burundi experienced conflict between 1993 and 2000 had a GINI of 42.4 in
1998. Compare this to 30, 9 for the Netherlands in 2005 and 43,7 for Spain in 2000. The
score of the United States, however was 45(!) in 2005. This obviously shows that inequality
as measured by the GINI coefficient can’t actually explain the onset of war. (UNDP, 2006:
335-338).
This failure to show a quantitative link between inequality and conflict has by some
been attributed to the design of these studies. An important criticism regarding these studies
undertaken by the World Bank - amongst others- is that these studies focus on inequalities
between individuals and thereby fail to acknowledge the importance of inequalities between
ethnic, religious or racial groups (Humphreys, 2003: 3). It is this last form of inequalities that
qualitative research understands as being an important factor in explaining violent conflict.
Frances Stewart for instance developed the notion of horizontal inequalities:
“It is my hypothesis that an important factor that differentiates the violent from the peaceful is the
existence of severe inequalities between culturally defined groups, which I shall define as
horizontal inequalities […]” (2001: 2).
Stewart thus argues that when economic and political inequalities coincide with
ethnic or cultural distinctions, these inequalities can be powerful factors for the mobilization
of armed conflict. (2001: 29).
An important point is that these inequalities can actually be enlarged by economic
growth. This obviously complicates the negative relationship between economic growth and
the likelihood of violent conflict. It is, therefore crucial that approaches to violent conflict
that depend on economic growth to achieve sustainable peace keep in mind the relation
between economic growth and income inequalities.
14

The need for further quantitative and qualitative research into the economic
incentives for violent conflict is ever present. Nevertheless we should tentatively conclude
that impeded economic growth and high income inequalities are important indicators for the
probability of intrastate violent conflict. In order to prevent a post-conflict situation from
sliding back to a period of renewed violence, economic reconstruction should accordingly be
geared towards increasing economic growth and decreasing inequalities, especially when
these coincide with cultural distinctions. Unfortunately the attempts to influence these factors
through economic levers are greatly hindered by the impact that conflict has on economies.
In the remainder of this chapter the characteristics of post-conflict economies will be
disentangled in order to extract the priorities for post-conflict economic reconstruction. From
these policy priorities a number of issues will be derived which might be addressed in the
process of negotiating peace and be inserted as clauses in peace agreements, finally it will be
shown how these topics have been incorporated in the accords of Guatemala, DRC and
Sudan.
2.2. The War Economy: A Need for Reconstruction or Transformation?
In order to successfully discuss the impact of war on economies it is important to accept from
the outset that ‘the’ post-conflict economy does not exist. Post-conflict states differ in the
degree to which political, social en economic structures have been affected and damaged by
the occurrence of war (Ohiorhenuan & Kumar, 2005: 3). There are of course important
differences between countries such as DRC that have witnessed a total collapse of the state,
and countries like Sudan where important governance structures have, at least in the north,
survived.3
Notwithstanding the distinctions between different post-conflict economies, a number
of common characteristics can be deduced of what is often referred to as war economies.4
In
3
Nitzschke also underscores the important differences between separatist and non-separatist conflicts. For the
post-conflict situation it is of tremendous importance whether the new situation concerns a single state or two
states (2003:9). In those instances where conflict caused the separation of a political entity, post conflict
economic reconstruction should focus on different issues. One of these is for example the manner in which
natural resources are shared. These issues need to be discussed during the peace negotiations and included in
the accords, an example of which is the GPA between North and South Sudan in 2005 that explicitly discussed
the division of oil revenues.
4
There has been an important development in war economies. Traditionally the term refers to countries like
England during the Second World War that changed their economic orientation to support the war effort and the
15

the following a rough typology of post-conflict economies will be given. It will be shown
how violent conflict changes economic incentives and has a tremendous impact on
infrastructure, social cohesion and economic governance, all of which are crucial to
economic development.
2.2.1 Incentives
Extensive periods of violent conflict have severe consequences for the entire character of an
economy. Importantly post-conflict economies shouldn’t be solely understood as devastated
‘normal’ economies which can be simply put back on the path of development. This linear
notion of development will misunderstand the character of post-conflict economies. These
economies aren’t simply damaged objects that can be reconstructed. Indeed the term
‘economic reconstruction’ is misguiding in this sense. In stead, the conditions of war create
a new environment in which new forms of economic activity and economic relations will
develop.5
These diverging patterns of development are not intrinsically ‘good’ or ‘bad’ but
they can have an impact on the prospect of peace after a ceasefire or the signing of a peace
accord. The most important reason for this is that the conditions of war create different
incentive structures, which makes a number of people dependant on the circumstances of
conflict for their profits or even their bare survival.
In general, three separate incentives are distinguished that might be hostile to the
prospect of peace although in practice these three are rather entangled (Nitzschke, 2003: 9).
The first incentives are of course those of the combatants. During the conflict these actors
further exploited the conditions of widespread insecurity and limited governmental oversight
to acquire the economic means to support the armed struggle, for example financing weapons
through smuggle of poppy in Afghanistan or coltan in DRC.6
Goodhand groups these
incentives in what he refers to as the combat economy (2004: 157). Importantly after the
signing of a peace accord these economic networks still very much exist and need to be
war economies witnessed in present-day intrastate conflict. “In contrast to mass mobilization for wartime
production, the war economies that must be transformed to peacetime economies in contemporary cases of civil
war are not emergency adjustments to an otherwise normal economy but an entire transformation of social and
political institutions.” (Woodward, 2002: 192)
5
In different forms this point is also brought forward by Duffield (2002: 1055-1056) and Goodhand & Cramer,
(2002: 888).
6
Coltan, short for Columbite-tantalite is an ore which, when refined, is used for the fabrication of batteries for
mobile phones (Cellular News, n.d.)
16

actively countered to prevent those wanting to undermine the peace from acquiring new
means of waging war.
Not all those involved in the economic networks aimed at providing weapons are
politically motivated. This brings us to the second set of incentives which concerns economic
activities geared towards the making of profits. These activities utilize the circumstances of
conflict, such as diminished governmental capacity, to trade clandestine goods or services.
These activities are the result of purely economic interests and usually involve and give rise
to widespread criminal networks. An example of such organized crime as a product of
violent conflict is the mafia in Kosovo which became increasingly powerful during the
conflict between 1996 and 1998 (Nitzschke, 2003: 10). Goodhand refers to these incentives
as belonging to the shadow economy (2004: 162). After the creation of a peace agreement
these actors still have economic incentives to go back to the conditions of war as their profits
depend on these circumstances. These incentives must be countered through a combination
of law enforcement and the provision of new opportunities to allow profit generation that
doesn’t endanger the peace.
The final category of incentives covers those held by the people that depend on the
informal and illegal structures of the conflict economy out of bare necessity. This large group
involves those that simply cannot survive without becoming involved in the structures of the
conflict economy. An example is the large group of Afghan farmers that started growing
poppy, from which heroin is derived. Most of these farmers weren’t looking for easy profits.
On the contrary, the cultivation of poppy had given rise to a complex social system in which
farmers became dependent on the continued growth of poppy for their survival, for instance
because poppy lay at the basis of the credit system. Thus without growing poppy, farmers
would be unable to get access to the credit needed to buy new seeds. This third group of
incentives belongs to what Goodhand refers to as the ‘coping economy’ (2004: 163). For the
effective transition from war to peace after the signing of an accord it is necessary that this
large group is helped by basic levels of social security. Failing to do so will leave these
people trapped in dependency relations with criminal networks which make the large profits
and seek to consolidate these profits by counteracting the new government and its sphere of
influence.
17

It has transpired that these three forms of economic incentives that endanger the
prospects of peace can only be countered by a strong central authority that is able to actively
combat those that are politically motivated to spoil the prospect of peace and the criminal
actors that can’t be enticed to seek different means of profit making. Further there is a need
for the creation of economic opportunities. Both are complicated by the remaining
characteristics of the post-conflict economy.
2.2.2 Physical and Non-physical Infrastructure
Armed conflict also greatly impacts both physical and non-physical infrastructure. During
violent conflict infrastructure often becomes an important strategic target. For instance the
destruction of roads, ports and bridges may serve strategic interests of the combatants. The
same unfortunately goes for schools, hospitals and governmental offices. The impact of
conflict on infrastructure is compounded by the use of landmines which renders large tracts
of land inaccessible and unfit for the use of agriculture or reconstruction. Concomitantly,
conflict has a profound effect on non-physical infrastructure as well. Armed conflict
undermines the functioning of markets and banks and economic legislation such as property
laws, land rights and tax laws (Ohiorhenuan & Kumar, 2005: 5). The restoration and
construction of the infrastructure necessary for economic growth should therefore be an
important priority for economic reconstruction. In those countries where the damage to
infrastructure is most severe, priorities need to be made on the basis of their economic
impact. The revitalization of property rights and markets should be among these, considering
their importance to revitalizing economic traffic.
2.2.3 Social Cohesion
Social cohesion and trust are of fundamental importance to (economic) relations, sadly this
cohesion is greatly affected by the onset of armed struggle (Coyne, 2005: 329, 338). As a
result of violence, insecurity and massive flows of refugees, social relations are put under
tremendous pressure and the trust which is crucial for maintaining business relations quickly
evaporates. Furthermore, as a result of people fleeing the country a lot of social capital -such
18

as knowledge and business networks- is lost as well. After the termination of conflict these
relations are even further strained by the return of ex-combatants and refugees (Ohiorhenuan
& Kumar, 2005: 5). Economic reconstruction projects should therefore also be geared
towards the reestablishment and reconstruction of trust under the population. For instance
through community projects, reconciliation committees and transitional justice systems.
Moreover, the conditions should be created to prevent a further loss of social capital through
brain drain, and to induce the return of refugees. Beyond these goals, attention should be
given to the reintegration of former combatants through Disarmament, Demobilization and
Reintegration (DDR) projects. Finally, special attention needs to be given to the impact of
conflict on role patterns within communities. In times of conflict it are often the young men
that are made to fight. This will have an important impact on communities as women and the
elderly will become increasingly responsible for the daily economic activities and relations.
This capacity needs to be protected, also after the return of the men to prevent a collapse in
economic potential (Addison, 2001: 3, 4).7
2.2.4 Governmental Institutions
Fourthly armed conflict has an impact on governmental institutions in the sense that it often
leads to the disintegration of these (Ohiorhenuan & Kumar, 2005: 6). Governmental
structures that were weak preceding the conflict oftentimes are further damaged during the
armed struggle. In the face of insecure pay and diminishing oversight, government
employees become more sensitive to corruption. During conflict the institutions of the state
become a means of power to the ruling elite. The ruling class often uses the state as a means
to derive economic means for personal gain in stead of harnessing the powers of the state to
secure public goods and services to the wider population (Le Billon, 2000: 3). Impunity of
government officials becomes the norm.
Crucially, these modes of behaviour will endure after the resolution of violent
conflict. This will severely undermine the legitimacy of the state and its institutions. The lack
7
Especially the issue of property rights for women needs looking into as these are often threatened by the return
of the pre-conflict conditions where discrimination against women was often institutionalized. Moreover an
important difference exists between formal legislation and daily practice. In many post-conflict countries even
after the adoption of laws protecting the equal rights of women, discrimination remains a daily practice. See for
example countries like Uganda, Rwanda and Eritrea (Greenberg & Zuckerman, 2006: 4).
19

of legitimacy is further compounded by a lack of knowledge regarding policy making which
is usually pervasive in newly formed governments, such as the interim government of
Southern Sudan. Without this legitimacy effective policy making will become very difficult.
This of course threatens the ability of the state to issue the policy necessary to enable and
stimulate economic growth (Ohiorhenuan & Kumar, 2005: 6, 7) but also to act against those
actors seeking to undermine its authority such as the criminal networks discussed above. A
further threat to the legitimacy of the state is the way in which the ruling government governs
sources of natural wealth, such as oil, diamonds and timber (Ibid.). The overall result is a
state incapable of guaranteeing security, stability and economic growth (Goodhand, 2004:
167,168). The further lack of knowledge with government actors concerning economic
policy will result in a lack of solid macro-economic policy which has a severe structural
impact on the economy.
An important dimension of economic reconstruction should thus seek to strengthen
and rebuild the structures and institutions of government to restore daily governance. In
doing so, special attention needs to be paid to changing the behaviour of government officials
and improving economic policy. This will contribute to the restoration of thrust with the
population that is necessary to ensure effective policy and post-conflict reconstruction. Again
these tasks are often not recognized as forms of economic reconstruction. More often they
are understood as being part of a strategy of stimulating good governance (the Netherlands
Ministry of Foreign Affairs, 2005: 12, 13). However, in what preceded it has become clear
that those who are involved in these activities need to pay specific attention to the economic
dimensions and ramifications of this task.
In conclusion post-conflict economies are typified by perverted economic incentives,
damaged physical and social infrastructure and weak government structures. This results in
limited opportunities for legal economic activity and the existence of economic interests that
can potentially undermine peace and stability. This underscores the unique character of post-
conflict economic reconstruction. An important implication of this specific character is that
regular policy approaches will be ill adapted to deal with the various and entangled issues
that need to be resolved. Moreover, some policy initiatives aimed at stimulating economic
20

growth in post-conflict states will actually bolster certain elements of the war increasing the
likelihood of renewed armed conflict.
“Simply stimulating growth in an economy which may be characterized by structural injustices,
horizontal and geographical inequalities, corruption and patronage may only succeed in
reinforcing or reigniting violent conflict.”
2.3. The Goals of Post-Conflict Economic Reconstruction
One of the most important challenges for post-conflict economic reconstruction is the wide
array of problems that need to be addressed simultaneously within an environment
characterized by structural impediments. Economic reconstruction has little chance of
success without a government that is able to guarantee safety and the reconstruction of
infrastructure, whereas the government depends on a flourishing legal economy for the
financial means that it requires to fulfil its tasks. What's more, economic growth will have
little prospective without the removal of perverse economic incentives and a pervasive illicit
economy. On the contrary, under these circumstances economic growth may even contribute
to renewed violence and conflict. In general we should then distinguish two main priorities
for economic reconstruction.
2.3.1 Capacity Development
First it is necessary to establish an effective and functional government that enjoys a certain
degree of legitimacy and is strong enough to secure peace and security and capable of
formulating effective macro-economic and socio-economic policy.8
Further, this government
needs to preside over the knowledge and institutions to be capable of drafting effective
legislation with regard to tax and property laws. These developments are hindered by
lacking legitimacy, pervasive corruption and lack of financial means.
8
See Fitzgerald (1997) for an extensive analysis of macroeconomic policies needed in post-conflict contexts.
His main conclusion is that in post-conflict countries the real income of those living in cities depends on the
effective per capita food supply. During conflict the relations between cities and the villages responsible for the
production of food are often disturbed as food becomes the most important currency and farmers therefore have
little incentive to trade with the cities. According to Fitzgerald macroeconomic policy should be geared towards
the reestablishment of these trading relationships through the supply of production means relevant to
agriculture. This will increase the food supply and prevent the inflation of food prices (p. 39-41).
21

2.3.2 Private Sector Development
Secondly, post-conflict economic reconstruction needs to be geared towards establishing
economic growth. Growth will lead to more jobs and prospects for peaceful means of
sustaining livelihoods. Hence, economic growth will reduce the risk of renewed conflict. One
of the most important ways of stimulating economic growth is by developing the private
sector (OECD, 2006: 3).
The development of the private sector will lead to more employment opportunities
and to some extent to more revenues for the state through taxes and custom duties (Addison,
2005:3, 4).9
The development of the private sector will also entail higher production which
opens op possibilities to increase export which brings the hard currency needed for
investment and the import of capital.10
The development of the private sector is hindered by
insecurity, lacking social and physical infrastructure, lacking rules and regulations,
corruption, lack of capital, lack of know how and trade barriers.11
A further risk lies in the
possibility of the benefits of economic growth only being enjoyed by the elite, and thus
actually enlarging structural inequalities that will increase the likelihood of renewed conflict
(Gündüz, Vaillant and Banfield, 2006: 3).
2.4. Entry Points for Peace Agreements
From the foregoing a number of issues can be distilled that might be included in peace
agreements. Before we turn to this task, a distinction needs to be made between the roles of
domestic and international actors.
Governments and Intergovernmental Organisations such as the UN and the World
Bank, are often involved in the first stages of the drafting of peace agreements and can play
an active supporting role in agenda setting and providing support to peacebuilding through
security guarantees, technical assistance and, perhaps most importantly, through the
9
However the collection of taxes requires an extensive infrastructure such as a regulatory framework, oversight
and a banking system, which is often severely damaged during conflict. Tariffs on import and export are
considerably less cumbersome. Fortunately these forms of income will also be positively influenced by local
private sector development (Fitzgerald, 1997:37).
10
See for more information on stimulating trade in post-conflict countries: Gündüz et. al., 2006: 3, 4.
11
Addison emphasizes the fact that the export of low income countries is greatly dependant on agricultural
products. Unfortunately its precisely these products that are confronted with significant trade barriers in Europe
and the United States. This has a negative impact on the income of developing countries (Addison, 2005: 11).
22

financing of key provisions of the peace accords (Woodward, 2002a: 3). The domestic actors,
usually limited to the representatives of the warring parties, need to do the actual ‘agreeing’.
The most contentious issues will probably directly related to the root causes of the violence,
often related to political control over a territory or a people.
With regard to economic topics a distinction is often made between those that are -
and those that are not related to the root causes of violence (Suhrke and Wimpelmann, 2007:
14). In certain conflicts – such as those in Guatemala and El Salvador (Sorensen, 1998: 4)-
economic topics such as economic equality are understood as root causes of the conflict. In
these cases a discussion of economic topics, and certainly those that lay at the heart of the
conflict will probably sooner be placed on the agenda for the peace negotiations. This can
clearly be seen in the cases of El Salvador and Guatemala. The peace agreements that ended
these conflicts are explicitly geared towards the resolution of economic conflicts and contain
a large number of economic clauses when compared to other accords (Suhrke and
Wimpelmann, 2007: 24). However, the more interesting point is whether peace accords
should move away from only discussing the root causes of violence (economic or otherwise)
in order to use the accord to catapult the economic development that is crucial to the prospect
of long-term peace and stability. In order to successfully discuss this question in the
following chapter, first an overview is needed of the issues that might be included in accords.
In this chapter four distinct aspects of the war economy were brought forward that need to be
addressed. For each of these four dimensions specific clauses can be adopted within peace
accords.
With regard to incentives it has become clear that a number of measures are required,
first those actors that actively seek to destabilize the peace need to be neutralised through law
enforcement. Second, all the economic activity that is geared towards economic benefits or
daily survival needs to be harnessed and stimulated in a way that is supportive of peace and
development. For this to be possible a number of conditions need to be met. Importantly the
rudimentary prerequisites for investment need to be established. Most prominently among
these is a system of property and land rights which needs to be created in order to guarantee
ownership and make loans possible (IPA, 2003: 10). Further it will be crucial to combat
23

unemployment and finally socioeconomic policy needs to be drafted to protect those trapped
at a subsistence level.
In the Guatemala SE Agreement, II E 26, the parties commit themselves to:
“Through an economic policy designed to increase the use of the labour force, create conditions
for the attainment of rising and sustained levels of employment, while sharply reducing structural
underemployment and making possible a progressive increase in real wages;”
In the Final Act of the DRC peace process, Resolution No: DIC/CHSC/01, clause 6, the
parties agree to:
“Encourage investment projects able to generate employment, but also projects for the
rehabilitation or building of basic social infrastructures (schools, roads, health centres, etc) which
provide employment opportunities;”
Finally, the Wealth Sharing Agreement, clause 2.6, between the Government of Sudan and
the SPLM/A, establishes a National Land Commission which:
“shall be competent to review existing land leases and contracts and examine the criteria for the
present land allocations and recommend to the State authority the introduction of such necessary
changes, including restitution of land rights or compensation.”
The second dimension is the reconstruction of physical and non-physical
infrastructure. Two basic ingredients are needed: planning and investment. The planning and
funding of infrastructure projects will be difficult for many post-war governments, especially
when they can’t build upon pre-existing institutions such as in South Sudan. International
actors involved in the peace process can play an important role here by advising the parties
on priorities and guaranteeing financial means and know-how to realize these complicated
projects.
The SE Agreement, IV B 46, stipulates that the public spending will be:
“Giving priority to social spending, the provision of public services and the basic infrastructure
needed to support production and marketing;”
DRC’s Final Act, Resolution No: DIC/CHSC/01 clause 6, promises to:
“Encourage investment projects able to generate employment, but also projects for the
rehabilitation or building of basic social infrastructures (schools, roads, health centres, etc) which
provide employment opportunities;”
24

The Sudan Wealth Sharing Agreement, 15a, concludes the following:
“There shall be established a Southern Sudan Reconstruction and Development Fund (SSRDF) to
solicit, raise and collect funds from domestic and international donors and disburse such funds for
the reconstruction and rehabilitation of the infrastructure of the South, for the resettlement and
reintegration of internally and externally displaced persons, and to address past imbalances in
regional development and infrastructure.”
Third, on the level of social cohesion one of the priorities should be to devise a
strategy to deal with the difficulties relating to the return of refugees and combatants. Again
the establishment of a system to deal with land and property claims is crucial to prevent
conflicts. Further a strategy needs to be devised to create sources of employment.
Employment is crucial to the reintegration of combatants and refugees and will greatly
contribute to the prospect of peace and stability. The great importance of creating short term
employment opportunities may even justify job creating projects that might make little
economic sense, for example through the development labour intensive infrastructure
projects. This however will not always be something donors are willing to finance; especially
the World Bank seems reluctant to do so (Woodward, 2002: 201-203).
The Guatemala SE Agreement, I B 13, specifically includes a clause aimed at stimulating the
participation of women
“Recognizing the equal rights of women and men in the home, in the workplace, in the production
sector and in social and political life, and ensuring that women have the same opportunities as
men, particularly with regard to access to credit, land ownership and other productive and
technological resources;”
Underwriting the importance of the integration of refugees, the DRC agreement states the
following in Resolution No: DIC/CHSC/02:
“Immediately after the Inter-Congolese Dialogue, the Congolese authorities must ask the
Secretary-General of the UN to invite a multidisciplinary and inter-agency technical panel to
formulate a multi-sectoral, long-term emergency programme to deal with humanitarian issues and
socio-economic rehabilitation of affected Congolese, ie refugees, displaced persons, demobilised
soldiers, vulnerable groups, etc.”
As shown above, the Wealth Sharing Agreement in Sudan establishes Southern Sudan
Reconstruction and Development Fund (SSRDF) which is also burdened with the
resettlement and reintegration of internally displaced persons.
Finally the governmental institutions need to be created and policies decided upon.
Again donors will need to play a large part in assisting institution building, and this will
certainly require long-term involvement. To support institution building peace accord could
25

include provisions that discuss the blueprint of these new institutions and for instance
determine the powers of the different ministries. More important, especially on the short
term, is the establishment of policy priorities. With regard to economic development certain
priorities need to drawn for macroeconomic and socioeconomic policies, this includes
policies that regulate taxes, customs and duties; privatization, international trade relations,
employment creation, inflation and macro stability, the management of natural resources but
also means to combat corruption and strategies to spend and secure international assistance.
Tax collection is explicitly mentioned in the SE Agreement, IV B 49, in the form of a
concrete ambition:
“Bearing in mind the need to increase State revenues in order to cope with the urgent tasks of
economic growth, social development and building peace, the Government undertakes to ensure
that by the year 2000, the tax burden, measured as a ratio of gross domestic product, increases by
at least 50 per cent as compared with the 1995 tax burden.”
In Resolution No: DIC/CHSC/07, the parties to the DRC Final Act decide upon the
establishment of the Higher Council for Promoting Ethnical Conduct and Combating
Corruption which will:
“reinforce the managerial capacity of public institutions and the business world, with special
reference to their respective ethics;”
With regard to governmental capacity the parties to the Sudan Wealth Sharing
Agreement, 15 C, acknowledge the importance of establishing two Multi Donor Trust
Funds (MDTF):
“The MDTFs shall commence immediately to support, among other things, priority areas
of capacity building and institutional strengthening and quick start/impact programs identified
by the Parties.”
The clauses above were but a selection of the scope of the three agreements, this shows that
economic clauses with varying degrees of specificity can as a matter of act be enclosed in
peace accords. The question that now needs answering is whether the inclusion of economic
conditions is intrinsically worthwhile and should be actively promoted by those involved
with peace processes and negotiations.
26

Chapter 3: Peace Accords
3.1 Peace Accords and the Agenda for Peace
In the forgoing chapter it has become clear what the basic needs of post-conflict countries are
with regard to economic reconstruction, where the focus of these activities should lie and,
most importantly for present purposes, which issues can be taken up in peace accords. Before
we can further discuss whether these should be adopted it is helpful to delve deeper into the
topic of peace accords and to distinguish the main lines of discussion which surrounds this
complex topic.
Before the 1990s scholars mostly took a legalistic focus with regard to peace
agreements, focusing mainly on the conditions under which parties could be brought to sign
these accords. The idea being that once parties agreed an agreement would simply ‘stick’.
This line of thinking came under pressure due to events in the 1990s. Over a million people
were brutally killed in Rwanda and Angola after the failure of peace agreements designed to
end these conflicts. Over the remaining decade peace accords failed in Liberia and the Congo
as well, again leaving hundreds of thousands of people dead (Stedman, 2002: 1). Shocked by
these events attention was increasingly paid to the question why some agreements succeed
where others fail. This changing perspective was partly inspired by the introduction of the
“Agenda for Peace” by the UN Secretary General Boutros Boutros-Ghali in 1992. This report
launched the concept of ‘peacebuilding’ as “action to identify and support structures which
will tend to strengthen and solidify peace in order to avoid a relapse into conflict.” (1992:
clause 22). The question thus became how peace agreements can be designed to ensure a
strong and durable peace.
3.2 Peace Accords: Reasons for Success and Failure
Over the years a number of different explanations have been put forward to explain the
success and failure of peace accords. Authors tend to focus on a number of issues, the most
important being third-party support, institutional design and substantive issues.
Hampson belongs to the first group, arguing that the success of accords is determined
in large part by the quantity and quality of third party support. In his words:
27

“[…]for peace settlements to succeed third parties must entrench and institutionalize their role in the
peacemaking and peace-building process. Third parties must also possess significant resources and
staying power to remain fully engaged in the negotiations leading up to the settlement and subsequent
peacebuilding process.” (Hampson, 1996 :23)
Although Hampson argues that the role of third parties is crucial to the success of an
agreement, he fails to specify under which conditions this support is actually provided. The
important problem of course being that in most cases international actors fail to bring the
“significant resources and staying power” that Hampson understands as critical to the
prospect of success.
Walter on the other hand focuses on the institutional design which is established in
peace accords. She takes a perspective that seems to be influenced by prisoner dilemma
approaches, focusing on the problem of allaying fear of defection between the parties to the
agreement. She argues that third-party security guarantees and the guarantee of power-
sharing are necessary to enable the parties to commit themselves to the accord (1999: 61-62).
A number of problems arise with this view. First her focus on institutional design -which is
supposed to ensure political power for the former combatant parties- is by some understood
as detrimental to the prospect of long-term peace and stability. Timothy Sisk for instance
argues against this so called ‘consociational’ power sharing which he contends can prove
harmful to peacebuilding and conflict transformation (1996: 38, 39). The experiences in
Bosnia Herzegovina of course provide a case in point. The Dayton Accords were highly
specific with regard to institutional design and were careful to guarantee political influence
and veto capabilities to the three parties. Since 1995 it has become clear that this design and
its corresponding bureaucracy is one of the most important impediments to development and
has been an obstacle to the transformation of the difficult relationships between the three
parties.12
Secondly, in focusing on the problems regarding uncertainty, Walter fails to
acknowledge that non-compliance with agreement might also be a conscious strategy of
parties unwilling to accept a settlement. Finally both Walter and Hampson fail to differentiate
between different civil wars and ignore the relation between the characteristics of a conflict
and the implementation strategy that is needed. Stedman is right to point out that the
12
Indeed in July 2007 tensions between the Repbulika Srpska and the Federation of Bosnia Herzegovina are
increasing as a result of a disagreement over the question whether the two entities should be disbanded in favour
of a single entity. This shows that the clever institutional design has achieved little with regard to unification.
28

characteristics of civil wars, such as the number of warring parties, balance of power, size of
the country, number of combatants, level of death and destruction and the capabilities of the
residual state greatly affect the viability of peace implementation strategies (2002: 4-8).
Thirdly a number of authors are specially geared towards the discussion of the
substantive sub-goals of peace agreements such as human rights, the return of refugees,
disarmament and demobilization and democracy.13
Surprisingly, with regard to the
discussion of substantive issues in peace accords, almost no attention is paid to the need for
rapid economic reconstruction and development (Woodward, 2002: 183). In fact, the debates
surrounding economic reconstruction and those relating to peace accords are completely
separated. The important task set out in this paper is to find out whether this is justified. In
the following sections we will then delve deeper into the case for inclusion of economic
conditions in peace accord. In this investigation we should take seriously the danger of
overanalyzing one specific topic or sub-goal of peace accords. First of all it is quite obvious
that a single topic should never be the sole focus of a peace agreement. This specifically goes
for those topics that aren’t conducive to the direct cessation of violence which is of course
the minimum ambition of a peace accord. Moreover the scope of this paper is far too limited
to provide a basis to argue the importance of one substantive topic over other topics. Instead,
the main goal of this paper, as established in the first chapter, is to explore whether the
inclusion of economic provisions in peace accords could be an appropriate means to advance
post-conflict economic development which has been established to be crucial to the prospect
of peace. It is to this question that we can now finally turn.
3.3 The Case for Inclusion of Economic Topics in Peace Accords
In the foregoing sections it has been established that economic clauses can as a matter of fact
be adopted in peace accords. The three case studies showed detailed provisions regarding
economic reconstruction. However a distinction should be made between economic clauses
that are tied to the root causes of violence and those that are included to assist economic
13
With regard to democracy an important point of contention is the level of inclusiveness of peace agreements.
More often than not the negotiations are between a very limited number of actors which raises the question
whether the parties are representing the interests of broad constituencies or only their own interests. A positive
exception is for example the Inter Congolese Dialogue which included civil society and unarmed political
groups and was responsible for the formulation of the “Final Act” as well as the provisional constitution.
(Mangu, 2003: 168).
29

reconstruction. The question is whether economic clauses need also be discussed in those
cases where economic topics aren’t necessarily tied to the root causes of violence but are – as
has been established in the previous chapter- crucial to the prospect of lasting peace.
Although economic topics were tied to the root causes of conflict of both Guatemala and
Sudan, the economic clauses in the peace accords are not just concerned with social justice
but also seek to establish the conditions necessary for economic reconstruction and
development. The peace agreements are not only instruments geared towards resolving the
conflict but also documents aimed at securing post-conflict development and performing a
road-map function for post-agreement politics.
To derive whether the inclusion of economic clauses is indeed a relevant measure, in
the sense that it might actually contribute to post-war stability and economic development, at
least three criteria need to be satisfied. The first criterion relates to the function of peace
accords. The inclusion of economic topics in peace agreements to accelerate post-agreement
economic reconstruction will only make sense if these agreements are more than documents
aimed at the cessation of open hostilities. On the contrary, these accords need to be able to
function as visions for the future. Secondly the inclusion of economic conditions will only be
appropriate when the design of peace accords matters. Only when the formulation of an
accord is important for the post-war situation, will it matter whether economic clauses are
included. Finally, inclusion of economic clauses will only be relevant when their inclusion
won’t endanger the establishment of agreements altogether. If the discussion of economic
topics will endanger the prospect of peace, their inclusion surely won’t be an effective means
to stimulate post-war economic reconstruction. In what follows these three topics will be
further discussed.
3.2.1 Peace Accords: Peace versus Peacebuilding
In Peace versus Justice William Zartman coins the distinction between forward- and
backward-looking outcomes. Backward-looking negotiations seek to end the previous
violence where forward-looking negotiations are aimed at preventing future violence (2005:
3). This distinction neatly describes the question that needs to be resolved here. For the
subject is which functions peace agreements can and should fulfil. Beyond the basic
30

distinction between forward and backward-looking agreements three functions of peace
accords are distinguished.
The first function of peace accords is clearly to bring a cessation to open violence.
While all peace agreements seek to fulfil this function, some will be limited to just this goal.
These accords will mainly include clauses that aim to bring an end to violence without
providing a plan for transformation of the conflict structures.14
The Dayton agreement that
negotiated an end to the conflict in Bosnia Herzegovina is a good example of such an
agreement. Here the main focus was to create a political structure which would allow the
Serbs, Bosniacs and Croats to live in peace. Besides the inception of the Commission for
Real Property Claims of Displaced Persons and Refugees (CRPC) -a mechanism to handle
property claims in order to expedite the return of refugees- it includes hardly anything with
regard to the resolution of civilian issues (The General Framework Agreement for Peace in
Bosnia and Herzegovina, 1995: Annex 7). This limited character of the Dayton agreement is
further emphasized by Cousens who points out that the agreement is marked by a ‘minimalist
schedule’ with regard to political and civilian topics (2002: 543).
However, peace accords can do more. By setting an agenda for reforms, the creation
of momentum towards transformation and by bringing in international donors and agencies
peace agreements can fulfil a roadmap function to guide a country to development. In this
capacity peace accords will include far reaching provisions to not only address the causes of
violence but also to give direction to post-accord development.15
William O’Neill writing
about judicial reform argues that peace agreements offer a unique opportunity for (judicial)
reform, he argues that reformers “should seize this moment aggressively because it won’t last
long and may not come again soon.” (2005: 2). The Lomé peace accord in Sierra Leone is an
example of an agenda setting accord. In it the parties for example promise to provide nine
years of free education (Peace Agreement Between the Government of Sierra Leone and the
14
The term ‘conflict settlement’ is adopted by Reimann to refer to this approach to conflict (Reimann, 2004: 9).
Hugh Miall calls conflict settlement ‘conflict mediation’ but defines it in the same way as Reimann does (Miall,
2004: 3). These approaches are understood to aim for what is sometimes referred to as a situation of ‘negative
peace’ as opposed to ‘positive peace’. Where ‘positive peace’ refers to the societal circumstances under which
people aren’t hindered by institutional injustice and have the opportunity to fulfil their potential, negative peace
is concerned with the absence of physical violence.
15
Reimann speaks of ‘conflict resolution’ which puts a strong focus on unmet needs and addressing the root
causes of violence and the further going ‘conflict transformation’ that is geared towards redesigning the
structures that are believed to cause the unmet needs (Reimann, 2004: 10)
31

Revolutionary United Front of Sierra Leone, 1999: Article XXXI). Further the parties agree
on establishing the Commission for the Management of Strategic Resources, National
Reconstruction and Development, although the accord fails to specify in what way the
strategic resources will be used for the “benefit of the people of Sierra Leone” (Article VII).
A third function attributed to peace accords is their capacity to provide both national
and international actors with a political and semi-legal basis for post-conflict programs.
Importantly, the content of peace agreements can be used by international actors to fulfil a
role of guarantor to the accord which will render defecting behaviour by the stronger party
more costly.16
This is emphasized by Suhrke and Wimpelmann who interviewed a number of
officials of the UN and international development agencies, and found that most “cautiously
favoured inclusion of statebuilding provisions in a peace agreement as a basis for
implementing post-conflict programs.” (2007:17).
In including specific clauses to address economic reconstruction the case studies selected for
this paper seem to actively fulfil roadmap functions. The question is of course whether the
lofty ambitions set forth in these agreements actually contributed to peacebuilding.
The SE Agreement of Guatemala clearly has the ambition to fulfil a roadmap
function. This is reflected in the circumstances under which the accord was established. The
fighting in Guatemala had already stopped before the final accord was signed and within the
Guatemalan society the accord was perceived as important for its potential role in
transforming the society. Its many provisions, which cover all important topics of economic
reconstruction, testify to this ambition (Stanley & Holiday, 2002: 421-422). However
Stanley and Holiday conclude that the Guatemala peace accords “have more the form of
comprehensive peace accords than the substance” and criticize the lack of details which
makes verification impossible and thereby negates the opportunity for the international
community to hold the parties responsible to specific commitments (Ibid., 457). Suhrke and
Wimpelmann come to the same conclusion. They show that most targets of the SE agreement
have not been met and the development indicators of Guatemala with regard to for instance
16
This point is also brought forward by Arnault who argues the that “the commitment of international actors to
the substance of the agreements, and not just the end of the conflict, notifies the stronger party that it will have
to contend with the weaker party and the international community if it should be tempted to go back on its
undertakings.” (2001: 8)
32

poverty, child mortality and economic inequality are considerably worse than those of other
South American and Caribbean countries (2007: 40). Also the governmental capacity and its
institutions have seen little improvement; the public sector remains weak and corruption
widespread (Ibid., 40). Suhrke and Wimpelmann conclude that the main reasons for this
weak implementation record are the limited political will and strength of the government
together with the marginalized role of the URNG. Despite the lack of implementation the
authors do conclude that the SE agreement still functions as a normative framework and is
used by both domestic and international actors to criticize the government (Ibid., 40-41).
With regard to the implementation of the development agenda set forth in the DRC
Final Act, the pervasive lack of security remains a formidable obstacle. As recently as March
2007 large scale fighting erupted in Kinshasa between the government and opposition which
left hundreds of people dead and forced opposition leader Bemba into exile (Stearns, 2007:
202). Despite some progress in uniting DRC and establishing a democratic government, the
government is marked by corruption, it provides almost no social services to the population
and human rights abuses by the army are widespread (Ibid., 202). Also the lack of a strong
state results in impunity and little attention to justice. Justice is, as has been discussed in the
previous chapter, crucial to the reconstruction of (economic) communities. The weakness of
the central government is compounded by large scale embezzlement, in the customs sector
alone this costs the government USD 1 billion a year (Ibid., 205). Stearns concludes that
development is dependant on the willingness of the Congolese leadership. However for this
to happen the Congolese must gain more political power which depends on the establishment
of democratic institutions which is in turn hindered by the Congolese leadership. The
international community should try to play a role in moving to government towards the path
of reforms. The process of peacebuilding has thus not yet made much progress in DRC and
we must conclude that the far-reaching ambitions set forth in the Final Act have thus had
little impact on development and economic reconstruction thus far.
The Sudanese Wealth Sharing Agreement as a vital part of the Comprehensive Peace
Agreement between the SPLM/A and the Government of Sudan also includes a wide array of
clauses to expedite economic reform. Most importantly perhaps is the establishment of the
Southern Sudan Reconstruction and Development Fund and the Multi Donor Trust Fund for
Southern Sudan. The MDTF-S is based on the Joint Assessment Mission (JAM) which was
33

conducted in December 2003 and established the needs for the reconstruction of Sudan
during the interim period (2005-2011). The level of inclusion of different stakeholders sets
the JAM apart from other post-conflict needs assessments and has greatly contributed to its
level of detail and its relevance to post-conflict Sudan (Scanteam, 2007: 83). One of the main
conclusions of the MDTF evaluation study with regard to the MDTF for South Sudan was
that its operation was constrained by the limited capacity of the newly established
Government of South Sudan (GoSS) (Ibid., 94-95). Jooma also argues that the capacity of
the GoSS is among the main challenges of establishing post-conflict reconstruction which is
further compounded by the difficult transformation of the SPLM/A from a military
organization to a political party (2005: 14-15).
Thus with regard to the first criterion the results are mixed. Although peace accords without
doubt have the capacity to include agenda’s for peace and development, in practice much
depends on the capacity and willingness of the involved parties to actively pursue the
established agenda’s.
3.2.2 Peace Accords: Intelligent Design versus Darwinism
With regard to the importance of the content of peace accords, Arnault distinguishes between
the ‘constitutive’ and ‘instrumentalist’ schools. The former understands the content of the
peace accord as essential to the success of the peace process. In this view a good agreement
will lead to durable peace, a bad agreement less likely so. The ‘instrumentalist’ school on the
other hand, argues that the peace agreement should be understood as one of the many stages
in a peace process and should therefore not be seen as critical to the success or failure of the
entire process (2001: 1). This distinction is relevant to the present undertaking for the issue at
hand is whether inclusion or exclusion of economic issues will affect the implementation of
the agreement and its chances of success.
It seems quite reasonable to agree with the constitutionalist view that failures of peace
implementation are related to the quality of the agreement and mediation. Peace agreements
that are too vague or lack in the degree to which the root causes and topics crucial to
peacebuilding (such as economic issues) are treated, seem liable to endanger the prospects of
peace. It is however not at all clear to what extent mediators can influence the clarity or
34

comprehensiveness of the accord. It seems that the creation of an accord that seeks to deal
with a range of highly complicated topics under extremely precarious circumstances can’t be
compared with the writing of a book whereby the level of clarity is simply chosen. Instead
the creation of a peace accord should be compared with a political process which usually
results in a political product of compromise. The talents and creativity of mediators can thus
only determine the final product to a certain extent, the other part being fully in the hands of
the negotiating parties (Stedman, 2002: 10).17
To make matters worse for constitutionalism, Arnault convincingly adds that the
constitutionalists overemphasize the importance of the peace agreement within the larger
process of peace implementation in which the accord is but an element (2001: 22). This is an
important point for it calls attention to the impact of external factors on peacebuilding,
varying from accidents –John Garang’s fatal helicopter crash springs to mind- to the level of
international support. When viewed from this perspective the importance of a peace accord
hinges on its contribution to the ability of the parties to overcome obstacles that arise during
the implementation process. According to Arnault peace accords should at least address those
issues that can form the largest threat to the peace accord, these are: “the physical security of
the parties, protection from judicial prosecution for actions relating to the conflict, the
socioeconomic welfare of the leadership and combatants, the political and financial viability
of the parties and finally the substantive provisions that are deemed of vital interest by the
parties.” (2001: 6). Note the emphasis on the interest of the parties over the interests of the
population. The substantive provisions –such as economic policies- are seemingly only
important to the extent that they are related to the power relations of the agreeing parties.
This is also emphasized by Goodhand and Cramer who argue that the resolve,
trustworthiness and commitment of the state actors and the parties to the agreement matter
more than the ambitions set forth in peace accords (2002: 887).
The relative importance – or unimportance- of substantive provisions in peace
accords is further underlined by Putnam. In an article discussing the inclusion of human
17
This point is also brought forward by Putnam: “Short of situations in which a settlement is imposed from
outside, mediators are limited in their ability to force issues and provisions onto the negotiating table. Starting
conditions for negotiation impose serious constraints on the type and range of measures – human rights
provisions among them- that parties are willing to agree to, and also indicate a great deal about the probability
of their fulfilment once accepted.” (Putnam, 2002: 242).
35

rights provisions in peace accords, he adds that the degree to which human rights are
incorporated in peace agreements is only very weakly correlated to the degree to which they
are protected in the post-agreement phase. He continues with:
“In actuality, the enumeration of human rights provisions offers little in the way of leverage in the
absence of institutions or actors willing and able to implement them. At the same time, premature or
misplaced attempts to force inclusion of enumerated human rights provisions may create additional
stumbling blocks to settlement – by opening up new areas of disagreement, or by providing
uncooperative or obstructionist parties additional pretexts for failure to sign a proposed agreement.”
(Putnam, 2002: 242)
But what then should we make of the rapport by the International Peace Academy on the
future of state-building which concludes that the “success or failure of post-conflict state-
building endeavours depends to a considerable degree on the quality and nature of the peace
agreement upon which the new order will be built.” (2003: 7). Although this seemingly goes
against what was discussed above, I believe it should be understood as complementary to the
other view. The conclusion that should be drawn is that the design of a peace agreement is
important in the degree to which it can guide peace implementation; however this is limited
by the specific circumstances that surround the conflict and the conflict parties.
In analogy, the design of economic clauses in peace accords shouldn’t be
disentangled from the implementation process. And indeed, looking at the three case studies,
this seems to be the case. The failure to implement the economic reconstruction strategy in
Guatemala should not be understood as the result of badly designed economic clauses. It is
true that verification is hampered by the lack of sufficient detail with a large number of
topics. (Stanley & Holiday, 2002: 421-422). However the topics where it does lay down hard
promises such as a the ambition to increase the tax burden by 50 percent by the year 2000
(SEA, IV: 49) or its goal to attain GDP growth of six percent per annum (SEA, II: 18) also
go unimplemented (Suhrke & Wimpelmann, 2007: 40). More attention thus needs to be
given to the process of actual implementation and establishing the mechanisms to effectuate
implementation. In the case of Guatemala the period of peace implementation was
characterized by a very weak opposition that could wield little power to keep the government
committed to the agreement. Although the SE agreement was of some use to international
agencies in getting the government to commit to reforms in the end in Guatemala the largest
part of the implementation depends on the willingness of the government. With regard to
DRC it is still too early to draw definite conclusions with regard to the implementation of the
36

Final Act, although the present situation of ongoing violence and corruption does not bode
well. In the case of South Sudan the structure of the JAM and MDTF seem to be important in
keeping the parties committed to the implementation of the CPA. Both the SPLM/A and the
National Congress Party are committed to implementing the CPA as both perceive the
agreement to be in their best interest (Jooma, 2005: 10). The implementation is further
supported by the large scale donor involvement in the MDTFs. The largest structural
impediment to the implementation of the Wealth Sharing Agreement is, as was also
discussed above, the weak institutional capacity of the GoSS. Fortunately this goes
acknowledged by donors and much attention is given to increasing the capacity of the GoSS.
3.2.3 Peace Accords: A Do No Harm Approach?
The final question that needs to be discussed here is whether a trade-off exists between the
peace and peacebuilding functions of accords discussed above. With regard to the present
topic the concern is whether the inclusion of economic clauses will decrease the likelihood of
attaining any agreement at all. Stedman for instance argues that at times mediators face the
choice between a weak agreement and attaining no agreement at all (2002: 10). This of
course implies that insisting upon the inclusion of a specific topic of contention (such as
economic development) may cause the failure of an entire peace process. This notion is also
raised by Call in his discussion of the peace accord that ended the conflict in El Salvador.
This agreement didn’t include provisions that were far reaching enough to change the
economic inequalities that were understood as important causes of the conflict. However, so
Call argues, their inclusion would have probably made an agreement unattainable (2002:
412). Similar points have been raised with regard to the peace processes in for instance
Sudan and Angola (Suhrke & Wimpelmann, 2007: 14). Furthermore, Rothchild argues that
“the short-term security concerns of the bargaining parties may be at odds with the long-term
institution-building needs of the society.” (2002: 117-118). This again implies that
addressing other issues than the short term security concerns may threaten the establishment
of an accord.
The question however remains whether the inclusion of clauses relating to economic
development may in fact threaten the accord. The examples discussed by Suhrke &
Wimpelmann with regard to Angola and Sudan relate directly to the root causes of the
37

conflict (such as income or political inequalities) which of course are the most sensitive
issues in a negotiation. Their discussion can therefore have a large impact on the probability
of success. This especially holds true when, such as in the example of El Salvador, an issue is
directly related to an agenda of one of the combatant parties. Despite these misgivings the
simple fact is that economic conditions are included in a number of peace accords and have
been in the three cases studied in this paper. In an email Timothy Sisk from Denver
University also argues that the inclusion of economic topics will most probably not threaten
the accomplishment of an accord (Timothy Sisk, email, 5 July 2007). To gain more
understanding of this topic it is relevant to look at the negotiating processes of the three case
studies to investigate the role that economic topics played in the negotiating process.
The peace negotiations in Guatemala lasted for ten years which of course shows the
difficulties with which this process was faced (Suhrke & Wimpelmann, 2007: 39). As a result
of the diminished importance of the rebel faction URNG, economic and social issues played
a more important role than military topics during the negotiations. This was strengthened by
the fact that different groups in society saw the peace process as a chance to reposition
Guatemala in the international arena (Stanley & Holiday, 2002: 432). Aid agencies were
much involved during the negotiations, this goes especially for the negotiation of the SE
Agreement in which the International Financial Institutions (IFIs) transgressed their formal
roles as providers of technical assistance by actively advising both parties on the content of
policies (Suhrke & Wimpelmann, 2007: 39). Despite the difficulty of the negotiations both
domestic and international parties stayed committed to the process as a positive outcome was
deemed crucial for the future of Guatemala. In this sense the discussion of economic topics
probably never endangered the establishment of an accord. However, as has been discussed
above, a significant number of clauses in the SE Agreement are quite unclear. The question
thus remains whether a more detailed formulation would have in fact threatened the accord.
Another question that goes unanswered is whether a more limited scope of negotiations
would have delivered an agreement within a shorter time span.
The peace process in DRC was fraught with difficulties but these were not related to
economic issues besides the economic wellbeing of the belligerent parties. The important
challenges that arose during the negotiations were tied to disagreements relating to power-
sharing and indeed securing the economic and political future of the involved parties. The
38

distinction made by Suhrke & Wimpelman between conflicts of government and conflicts of
governance seems helpful here (2007: 15).18
Harshly put, conflicts of government are about
positions (self-interest) while conflicts of governance concern policies (perceived public
interest). The DRC conflict was the archetypical example of a conflict of government where
the different factions tried to secure power and economic well-being through the use of
violence. This is also reflected in the peace process during which the parties were
preoccupied with safeguarding power and positions. The vast levels of corruption and
embezzlement witnessed today are intimately related to this specific character of the DRC
conflict. The literature remains silent on the negotiation of the economic clauses in the Final
Act of the ICD. This seemingly reflects the secondary importance of these topics to issues
surrounding power sharing and disarmament. Thus while the inclusion of economic clauses
didn’t threaten the accord it probably will do little to assist post-conflict economic
reconstruction.
Finally the negotiations in Sudan were very precarious. After the failed attempts to
bring the parties to a dialogue of Abuja I and Abuja II in 1992, mediation was resumed in
1994. It took another ten years to finally negotiate the CPA which was signed in 2005
(Jooma, 2005: 9). Within the CPA the Wealth Sharing Agreement was one of the hardest to
negotiate. Indeed, similar to Guatemala, the conflict between SPLM/A and the National
Congress Party, was to a large extent motivated by economic issues.19
The significance of
economic development in the South for bringing a final end to the Sudanese conflict is
explicitly acknowledged in the agreement (Jooma, 2005: 12). Similar to the process in
Guatemala the central importance of economic issues combined with the commitment of both
national and international actors meant that in the end an agreement would be reached. Of
course like the SE Agreement the Wealth Sharing Agreement is far from perfect. A number
of clauses in the agreement are far from clear. For instance it is unclear who will be involved
with the National Petroleum Commission and National Land Commission which will have
tremendous impact on the division of oil revenues and property rights respectively (Jooma,
18
This terminology is first employed by Emeric Rogier (2004) Rethinking Conflict Resolution in Africa Lessons
from the Democratic Republic of Congo, Sierra Leone and Sudan. Clingendael, Conflict Research Unit, July
2004.
19
The eventual failure of the Addis Ababa Agreement of 1972 that brought an end to the First Sudanese Civil
War has been attributed to its weak economic provisions and its failure to address the importance of financial
independence of the South (Jooma, 2005: 8).
39

2005: 13). Again the questions remain whether a more detailed discussion would have
rendered an agreement unattainable and whether a less inclusive agreement would have been
less arduous to negotiate.
The conclusion of this third criterion brings us to the end of this chapter which has examined
whether the inclusion of economic conditions in peace accords 1) clashes with the nature of
peace accords; 2) is significant with regard to the implementation of these accords and
finally 3) whether it might threaten the prospect of actually establishing an accord. The
results of this and the previous chapters will now be discussed in the concluding sections of
this paper.
40

Chapter 4: Conclusion
After having established a typology of post-conflict economies and the four priorities for
economic reconstruction, the second chapter found a number of topics that can – and indeed
have been translated to clauses in peace accords. In the three cases studied in this paper
clauses were discovered for each of the four topics, these being 1) the transformation of
incentives; 2) the reconstruction of physical and non-physical infrastructure; 3) the
reestablishment of social cohesion and finally 4) the reinstitution of governmental capacity.
Informed of the possibility of including economic conditions in peace accords this
paper then turned to the question whether inclusion of this topics is desirable. Following a
brief introduction to the main topics of contention in the debate surrounding peace accords,
three criteria were established that peace accords need to meet in order for it to be relevant to
include economic conditions. Thus peace accords need to be able to fulfill the function of
peacebuilding agenda’s; 2) the design of peace accords must be important (otherwise
inclusion of economic topics probably won’t have much effect) and finally, 3) the inclusion
of economic topics should not harm the prospects of attaining an agreement. Unfortunately
this short investigation delivered mixed results.
Firstly, on the basis of both available literature and a limited exploration of the three
incorporated case studies it has become apparent that peace accords can in fact be more
ambitious than the Dayton peace accord, which is characterized by a very limited civil and
political agenda. A large number of peace accords actively guide peacebuilding activities
such as economic reconstruction and have incorporated special provisions to this end.
However the success of an accord fulfilling this function is largely dependant on the
willingness of the involved parties and the level of international support. This conclusion was
reaffirmed by the findings with regard to the second criterion. Here it became clear that the
exact formulation of a peace accords and its clauses -economic or otherwise- needs to be
understood within a larger context. Although words of course do matter, the implementation
process that follows these words seems to matter even more. Besides the wording of the
peace accord, this process is subject to a large number of external factors varying from the
national political circumstances to accidents. What distinguishes a ‘good’ agreement from a
‘bad’ agreement in this sense is its ability to form a basis to navigate the emerging challenges
41

during implementation. Apparently this guidance is not always best supplied by strict targets
such as those regarding GDP and tax collection in the Guatemala peace agreement, nor by
vague ambitions such as the Final Act of the ICD in DRC. Perhaps most hopeful then is the
Wealth Sharing Agreement of Sudan which through the JAM and MDTFs has tied the
international community to the reconstruction and implementation processes. This level of
involvement will ostensibly help to keep the parties committed to their agreements. Finally
the third chapter discussed whether the inclusion of economic conditions may threaten the
ability to reach an accord. The fact that accords are actually reached that include far reaching
economic provisions seemingly speaks against this notion. However, without detailed insight
into a large number of peace negotiations it will always remain a question whether an
increased level of detail would have threatened the creation of an accord or whether a less
detailed agreement would have been negotiated sooner. But, following the conclusion above,
increasing the level of detail might not be what is important. Most importantly a peace accord
should design a situation which allows for at least a minimum level of commitment, through
either clever institutional design or international involvement, to aid the implementation
process.
In conclusion there is a definite need to align post war economic peacebuilding with peace
agreements but this doesn’t necessarily entail the inclusion of highly detailed provisions
regarding economic reconstruction in peace accords. Instead, the focus should most
prominently be put on the process of implementation. There are a number of crucial
impediments to the successful implementation of reconstruction goals in peace accords, the
most important among these being the resolve and capability of the parties to the agreement.
This is a common theme in the three case studies. In Guatemala the combination of a weak
URNG and an unwilling government seriously impaired economic reconstruction despite the
scope of the SE Agreement. In DRC the parties that wield power are mainly involved with
safeguarding their own power and positions and have thus far utterly neglected the wellbeing
of the Congolese. Finally in Sudan the reconstruction of the South is endangered by the weak
governmental capacity of the newly formed GoSS. Crucial to the implementation of accords
is also the level of commitment of the international community, especially in Sudan the
important aid organizations were present before and during the negotiation of the Wealth
42

Sharing Agreement and have contributed greatly via the Joint Assessment Mission and the
subsequent establishment of the Multi Donor Trust Funds. However the international
community was also very much involved in both Guatemala and DRC. The difficulties of
these cases further reinforce the conclusion that in the end the parties on the ground wield the
most important influence on the outcome of peace implementation and reconstruction,
regardless of the lofty goals formulated in peace accords and the helping hands of willing
donors.
43

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