2. INTRODUCTION
• On January 9, 2011, the people of South Sudan voted to secede from
Sudan and form a new nation. This vote was promised in the
Comprehensive Peace Agreement (CPA), signed in 2005, which ended
the brutal 22-year civil war between the Sudanese government and
citizens in South Sudan. (3)
• Although South Sudan has vast and largely untapped natural
resources, beyond a few oil enclaves, it remains relatively
undeveloped, characterized by a subsistence economy.
• South Sudan is the most oil-dependent country in the world, with oil
accounting for almost the totality of exports, and around 60% of its
gross domestic product (GDP). (4)
3. INTRODUCTION CONT’d
• The country is faced with financing challenges with Oil production
expected to decrease to about 120,000 barrel per day down from
165,000 barrels per day in 2014 and a peak of 350,000 barrels per day
before independence in 2011. (4)
• The country is faced with a number of political, health and financing
challenges. U.N. agencies report that the humanitarian situation,
already dire with over 40% of the population facing life-threatening
hunger, is worsening, as continued conflict spurs a sharp increase in
food prices. Famine may be on the horizon. (5)
4. CHALLENGES
• The Country has experienced several social, economic and political
crises since inception
• Since its political independence in July 2011, the new state of South
Sudan has not been able to devise a workable vision to address pivotal
historical challenges and in turn has been unable to realize the political
and economic aspirations of its citizens. (1)
• the state of South Sudan’s infrastructure is in complete disarray, making
it difficult to pin down the single most pressing infrastructure challenge.
Existing infrastructure problems (whether related to assets, capacity, or
institutions) are daunting; it is simply not realistic to expect—even in
the most optimistic scenario—that the south will catch up with
neighboring countries, even those in a similar income bracket, in a
period of 10 years or even more. (2)
5. OBSTACLE TO UNLOCKING FINANCIAL OPPORTUNITY
• Road density in South Sudan is among the lowest in Africa;
connections with neighbors are limited, especially in the north. The
challenges of poor road network has a negative impact on
development and infrastructural investment by both local and foreign
investors. (2)
• The many sociopolitical crises the country has been through in last
few decade has also had a negative effect of the speedy development
of the country
• Also the division along political ideology has made it difficult for the
country to put in place policies that will in fact encourage investment
and growth.
6. Proposed solution to Unlock Financial Opportunities
• Improve Local Investors access to Fund:
Access to fund from both local banks and other multilateral
development banks can be improved by the government through the
provision of sovereign guarantee. This will encourage these bank to
provide fund which will be used to provide infrastructures such as road,
Power supply and investment in agriculture. The provision of these
facilities (aided by government’s guarantee) will further encourage
investment, as power supply becomes more available and the road
network encourages investment in areas of the country with huge
growth potentials (Limited by lack of basic facilities).
7. Proposed solution to Unlock Financial Opportunities Cont’d
• Harmonizing Policies on Tax:
Policy on taxes should be harmonized to avoid double/multiple taxing,
under or over taxing etc. Foreign and local investors looks out for
government tax policies, it’s implementation and monitoring. To
encourage foreign direct investment in the country some tax relief
could be given for the first few years for investors to establish and grow
their business. This tax relief could be in form of lowering the tax rate,
not taxing at all, or applying a minimum/maximum tax for the first few
years. This will encourage investors and help them increase their
Capital (which goes a long way to establish the company).
8. Proposed solution to Unlock Financial Opportunities Cont’d
• Training of Local experts
The Government can seek support of IDA and other Bodies to help in
the areas of training of technocrats and other local experts in various
fields to improve on the accuracy, effectiveness and efficiency of result
delivery. They can be trained in field of research and data gathering and
analytics. These expertise can help the country to improve its database
and other statistics which the government uses in decision making. By
improving on these, there can be an evidence based decision making
which will drive growth and reduce wastage of limited resources.
9. Conclusion
Based on the challenges and the current condition of the country
following the many years of political and economic crises. Adopting the
suggested measures could drives infrastructural development and
growth.