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Divestment, 20 years later

March 19, 2006

IN 1985, AFTER AN ANTI-APARTHEID movement had swept across college campuses and broadened into a nationwide push to divest corporate holdings in South Africa, this page urged investors such as the city of Los Angeles and the University of California to buck the trend and stay the course. While deploring the apartheid system and the South African government that enforced it, The Times believed that a wide-scale pullout of American investment would do more harm than good by putting apartheid's victims out of work.

Today, a similar movement is sweeping the country calling for divestment from another African nation whose assaults against its own people have horrified the world. This time we think divestiture is the right move.

On Thursday, the UC Board of Regents rightly voted to divest from nine foreign companies that help prop up the government of Sudan. It is a principled stand that should be repeated by other big investors, including the $200-billion California Public Employees' Retirement System.

The Khartoum government is using its revenues, most of which come from oil bought by Chinese-owned companies, to supply arms to Arab militias, which use them to massacre entire villages in Darfur. Khartoum is also using its own military to attack villagers whose only crime is living in an area associated with armed anti-government rebels. An estimated 200,000 people have been slaughtered in what the Bush administration has rightly labeled "genocide."

The UC regents are far from alone in considering divestment as a strategy to end, or at least protest, the atrocities in Sudan. Several prominent universities, including Harvard and Stanford, have already disengaged, while at least four states are in the process of divesting or restricting their investments, and several others have legislation pending. The regents were wise to narrow their focus only to companies that directly benefit the Khartoum government while providing few benefits to the people of Sudan. Unlike South Africa, with its well-developed industrial and service-oriented economy, Sudan is a largely agrarian country -- most of the victims of government attacks have been rural farmers and herders, not potential employees of multinational corporations. Thus the current wave of divestment, if handled properly, has a better chance of directly punishing the government and not the people than the campaign against South Africa did in the 1980s.

Not that a few divestments by conscientious Americans will have much impact on Khartoum; since 1997, American companies have been forbidden by federal law to do business in Sudan, so the U.S. has little economic leverage. But the divestment movement does help draw international attention to the appalling situation in Darfur while pressuring the foreign companies working with the murderous Sudanese government to pull out. That could be a catalyst for change in Africa's worst killing zone.

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