The Oasis Reporters
June 9, 2023
Twelve years after independence, South Sudan remains extremely poor and underdeveloped. A peace deal brokered in 2018 has failed to end conflict. And the government has failed to engage the people in state reconstruction, leaving the country without genuine and effective institutions of self-government.
The outbreak of conflict in the Republic of Sudan will hamper South Sudan’s efforts to get on its feet. This is so for two main reasons.
First, South Sudan’s economy is highly dependent on oil. But the oil has to pass through Sudan to get to export markets. The conflict in Sudan could halt this. Also, the deal struck with Khartoum on oil exports could be at risk if the war continues and the government in Khartoum collapses.
The second reason South Sudan’s efforts at statehood are threatened is that a peaceful Khartoum is critical for the peace process and development in South Sudan. Instability in Sudan could derail South Sudan’s peace process. It could relegate the country to persistent instability, economic deterioration, pervasive corruption and self-dealing by civil servants and political elites.
The country has enormous amounts of natural resources: the Nile River, petroleum, aluminium, iron ore, marble and gold. But even after more than 10 years of independence, a significant proportion of the citizens depend on humanitarian aid to meet their basic needs. In 2023, South Sudan had the highest poverty rate in the world. It is among the world’s most politically and economically unstable countries.
The key to resolving South Sudan’s economic problems is wealth creation and robust economic growth. This can only happen if all of the country’s ethno-cultural groups live together in peace. Peace and security in South Sudan depend, to a great extent, on a fully functioning, peaceful and democratic government in Khartoum.
South Sudan’s present economic prospects are tied directly to the production and export of oil. It accounts for 90% of public revenue.
South Sudan currently produces about 150,000 to 170,000 barrels of oil per day. But Juba receives income from only 45,000 barrels after an account is made of “the share owed to international companies and fees paid to Sudan”, based on the terms of the 2005 peace agreement. According to the International Crisis Group, the government’s opaque approach to accounting for oil sales “shields substantial revenues from oversight” and creates conditions that enhance corruption and mismanagement of public funds.
Some oil revenues are siphoned off by elites in Juba for their personal benefit. According to US government sources, some of those funds are used to “fund the purchase of weapons and other materials that undermine the [country’s] peace, security, and stability.” In 2012, President Salva Kiir claimed that his own government officials had “stolen” US$4 billion of the public’s money and that they needed to return it so that it could be used to lift the people out of poverty.
South Sudan’s oil travels through the Greater Nile Oil Pipeline via Khartoum to Port Sudan on the Red Sea. Continued fighting between the rival factions in Sudan could lead to sabotage or disruption of oil exports.
Continued fighting could also weaken Khartoum so much that it is no longer able to facilitate any export trade or oversee the arrangement for sharing oil revenues with Juba.
The peace process at risk
On 12 September 2018, South Sudan’s President Salva Kiir and Vice-President Riek Machar signed a peace agreement. The civil war had killed more than 50,000 people, forced more than two million from their homes, and derailed progress towards development and peaceful coexistence.
Sudan and Uganda are guarantors of the 2018 agreement to end conflict in South Sudan. Sudan also chairs the Intergovernmental Authority on Development, the group that worked to bring an end to the conflict.
The warring parties in South Sudan had a transitional period to make reforms, restore the rule of law and open up political spaces. But the country made no significant progress in that period. Insecurity and violence against civilians continued.
On 4 August 2022, the opposition and the government agreed to extend the peace agreement for an extra 24 months, starting in February 2023. Kiir stated that the extra time would allow preparation for elections.
Critics of the government have argued that instead of implementing the peace agreement, Kiir has inserted himself into the Sudan conflict, serving as the coordinator of efforts to secure a permanent peace deal between the feuding factions.
A spokesperson for South Sudan’s government has argued, however, that the peace process continues, pointing to meetings between Machar and Kiir.
A peaceful Khartoum is critical for the peace process and development in South Sudan. Continued instability in Sudan, then, could worsen the political crisis in South Sudan and cause further deterioration in economic and social conditions.