WASHINGTON/DUBAI/KHARTOUM (Reuters) - President Donald Trump announced on Monday the United States would remove Sudan from its list of state sponsors of terrorism as soon as Khartoum sets aside $335 million for payments for American victims and their families.
The deal could also set in motion steps by Sudan toward establishing diplomatic relations with Israel, a U.S. official told Reuters, following similar U.S.-brokered moves in recent weeks by the United Arab Emirates and Bahrain. The details and timing were still being worked out, the source said.
Though Trump made no mention of Israel in his tweet announcing the breakthrough with Sudan, rapprochement between Israel and another Arab country would give Trump a new diplomatic achievement as he seeks re-election on Nov. 3.
Sudan's designation as a state sponsor of terrorism dates to its toppled ruler Omar al-Bashir and makes it difficult for its transitional government to access urgently needed debt relief and foreign financing.
Many in Sudan say the designation, imposed in 1993 because the Washington believed Bashir’s government was supporting militant groups, has become outdated since Bashir was removed last year and Sudan has long cooperated on counter-terrorism.
U.S.-Sudanese negotiations have focused on funds that Washington wants Khartoum to deposit in escrow for victims of al-Qaeda attacks on U.S. embassies in Kenya and Tanzania in 1998, U.S. government sources said.
"GREAT news! New government of Sudan, which is making great progress, agreed to pay $335 MILLION to U.S. terror victims and families," Trump tweeted. "Once deposited, I will lift Sudan from the State Sponsors of Terrorism list. At long last, JUSTICE for the American people and BIG step for Sudan!"
A Sudanese government source said Khartoum was ready to pay compensation to U.S. embassy bombing victims.
Just minutes after Trump's statement, Sudan's Prime Minister Abdalla Hamdok tweeted: "Thank you so much, President Trump! We very much look forward to your official notification to Congress rescinding the designation of Sudan as a state-sponsor of terrorism, which has cost Sudan too much."
ISRAEL WAS STICKING POINT
A key sticking point in the negotiations was Sudan's insistence that any announcement of Khartoum's de-listing not be explicitly linked to normalization with Israel. Differences remain between Sudanese political and military officials on how far and how fast to go in warming of relations with Israel.
Hamdok, who runs the country together with the military in a transition since the toppling of Bashir, told U.S. Secretary of State Mike Pompeo in Khartoum in August the normalization issue should not be tied in with Sudan’s removal from the terrorism list.
One possibility, one U.S. official said, would be for Washington to leave it to Sudan and Israel to go public later, possibly in coming days, with an agreement on relations.
The UAE and fellow Gulf state Bahrain in September became the first Arab states in a quarter of a century to sign agreements to have formal ties with Israel, forged largely through shared fears of Iran.
Asked whether an Israel-Sudan breakthrough was imminent, Israeli Finance Minister Israel Katz told Israel's Army Radio:
"I hope that the intensive contacts will yield positive fruit."
The Trump administration, which is also expected to offer economic aid, must now notify the U.S. Congress of its intent to take Sudan off the terrorism list.
A remaining obstacle is Congress must pass legislation restoring Sudan's sovereign immunity, a shield against future terrorism-related legal claims for past attacks once it pays the compensation it already owes. Sudan had lost that protection because of the terrorism designation.
(Reporting By Matt Spetalnick and Nafisa Eltahir; Additional reporting by Khalid Abdelaziz in Khartoum and Dan Williams in Jerusalem; Editing by Richard Chang, Cynthia Osterman and Howard Goller)