South Sudan‘s Minister of Petroleum, Ezekiel Lol Gatkuoth, this month confirmed that South Sudan had increased its oil production by 6 000 barrels, bringing the total oil output to more than 180 000 barrels a day. File Photo: IOL

CAPE TOWN – South Sudan‘s Minister of Petroleum, Ezekiel Lol Gatkuoth, this month confirmed that South Sudan had increased its oil production by 6 000 barrels, bringing the total oil output to more than 180 000 barrels a day. 

This was achieved through the reopening of Block 1&2 in Manga oilfield, which was dormant for six years due to insecurity in the northern parts of the country. This development brings about more insights into some of the problems that African states are facing with regards to Economic Development Regression as conflict limits growth in the various regions. 

Oil-rich South Sudan has been struggling to increase oil production, months after the signing of the revitalised peace accord in September last year, which shows that it will take time to restore business and investor confidence after decades of unrest.

The name “Sudan” derives from Arabic bilad-as-sudan, meaning “Land of the black people”. The country was officially established on July 9, 2011, when it seceded from Sudan after decades of conflict. 

South Sudan, the youngest country in the world, is located in the central region of East Africa, spread over 619 745km², with a population of 13.3 million (UN 2019). 

South Sudan is known for its resources, especially oil, discovered in 1977. The civil war has prevented much exploration of oil deposits to the extent that up to now its potential oil reserves are unclear. Currently about 90 percent of the government’s revenue comes from oil resources, while the rest is collected in the form of taxes.

The country had a GDP averaging $12.63 billion (R194.25bn) from 2008 until 2016, reached a high of $17.83bn in 2011 and hit a record low of $3.07bn in 2016. A combination of internal conflict, weak global oil prices, closure of oil fields and poor rains resulted in economic activity contracting in 2016/17. 

Up to 95 percent of the population depends on self-sustainable agriculture to meet their food and income needs. Farm crops from low-input, low-output subsistence operations include sorghum, maize, millet and rice production. However, only 4 percent of South Sudan is under cultivation, its largest export being sesame seeds, which contribute at most 0.6 percent to total exports. 

Food security is a problem as close to 7 million people are food insecure (USAid, 2019), due to conflict and as below-average rainfall delayed the start of this year's planting season, which limited pasture regeneration and keeping livestock body conditions poor.

On the Neil economic scale, a can of coke costs 113.33 South Sudan pounds (SSP) (R13.38), and the price of a litre of petrol is 230 SSP (R27.19). 

South Sudan’s Vision 2040 encompasses medium- and long-term goals that the country wants to achieve by 2040. The objective is to ensure that the country is a united and peaceful nation, building strong foundations for good governance, economic prosperity and enhanced quality of life for all. 

As being one of the individuals who was physically in Juba, South Sudan, at its birth and then seeing this newest child of Africa descend into war and strife, its true wealth seems to be the exact reason there is no peace.

As a country that has oil, gas, gold and diamonds as well as the River Nile, there can be no reason why this newborn nation cannot be stable. 

It will take a world of reason and humanity to ensure that it does not remain shedding sad tears of civil war and tlibr, the cliché being the African tears of wealth.

Neil De Beer is the president of the IFA and advises numerous African states on economic development. www.ifa.africa or [email protected]

BUSINESS REPORT