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By Matt Spetalnick
WASHINGTON (Reuters) - The United States lifted long-standing sanctions against Sudan on Friday, saying it had made progress fighting terrorism and easing humanitarian distress, and also secured Khartoum's commitment not to pursue arms deals with North Korea.
In a move that completes a process begun by former President Barack Obama and which was opposed by human rights groups, President Donald Trump removed a U.S. trade embargo and other penalties that had effectively cut Sudan off from much of the global financial system.
The U.S. decision marked a major turnaround for the government of President Omar Hassan al-Bashir, who once played host to Osama bin Laden and is wanted by the International Criminal Court on charges of orchestrating genocide in Darfur.
However, Sudan will stay on the U.S. list of state sponsors of terrorism - alongside Iran and Syria - which carries a ban on weapons sales and restrictions on U.S. aid, U.S. officials said.
Sudanese officials also remain subject to United Nations sanctions for human rights abuses during the Darfur conflict, the officials said, speaking on condition of anonymity.
The lifting of sanctions reflects a U.S. assessment that Sudan has made progress in meeting Washington’s demands, including cooperation on counter-terrorism, working to resolve internal conflicts and allowing more humanitarian aid into Darfur and other rebellious border areas, the officials said.
State Department spokeswoman Heather Nauert said the sanctions relief was in recognition of Sudan's "sustained positive actions" but that more improvement was needed.
The Trump administration also secured a commitment from Sudan that it would "not pursue arms deals" with North Korea, and Washington will apply "zero tolerance" in ensuring Khartoum's compliance, one of the officials said.
But they said Khartoum's assurances on North Korea were not a condition for lifting sanctions, some of which had been in place for 20 years and have hobbled the Sudanese economy.
Sudan has long been suspected of military ties with North Korea, which is locked in a tense standoff with Washington over its missiles and nuclear weapons programs. But the official said Khartoum was not believed to have diplomatic relations with Pyongyang and that was not expected to change.
Sudan also has recently distanced itself diplomatically from Iran, another U.S. arch-foe.
POTENTIAL BOOST FOR BUSINESS
U.S. officials have said that sanctions relief, which will unfreeze Sudanese government assets, could benefit a range of businesses in Sudan, including its key energy sector.
The economy has been reeling since South Sudan, which holds three-quarters of former Sudan's oil wells, seceded in 2011.
“Sudan looks forward to building normal relations with the United States," the foreign ministry said in a statement. "However, this requires lifting Sudan from the list of state sponsors of terrorism because it does not apply (to Sudan)."
Central bank governor Hazem Abdel Kader said removing sanctions would allow Sudan's banking system to "reintegrate into the global economy," and Agriculture Minister Abdul Latif Ajimi said it would bring exchange rate stability that would boost agricultural development, according to state news agency SUNA.
Shortly before leaving office, former U.S. President Barack Obama temporarily eased penalties against the east African nation. In July, the Trump administration postponed for three months a decision on whether to remove the sanctions completely, setting up an Oct. 12 deadline.
Rights groups see the sanctions removal as premature.
“It sends the wrong message to lift these sanctions permanently when Sudan has made so little progress on human rights," said Andrea Prasow, deputy director of the Washington office of Human Rights Watch.
Democratic U.S. Representative Jim McGovern said the sanctions decision “legitimizes the murderous actions of the Sudanese government” and warned that “any back-sliding will likely result in Congress reinstating sanctions.”
The United States first imposed sanctions on Sudan in 1997, including a trade embargo and blocking government assets, for human rights violations and terrorism concerns. Washington layered on more sanctions in 2006 for what it said was complicity in the violence in Sudan's Darfur region.
(Reporting by Matt Spetalnick in Washington; Additional reporting by Mohammad Zargham in Washington, Khaled Abdelaziz in Khartoum and Mostafa Hashem in Cairo; Editing by James Dalgleish and Diane Craft)