Kenya, Uganda Salivating at South Sudan Prospects

 

East African News Agency (Eana) Arusha. Come July 9, 2010 Africa will have its newest and 56th state, the Republic of South Sudan.This development is exciting for the East African region because South Sudan, with its oil wealth, minerals and huge agricultural potential, is set to join the East African Community (EAC).

But who will be the biggest beneficiary? Both South Sudan and the countries that have had historical and cultural links such as Kenya and Uganda are salivating at the development. For a start, South Sudan will need a gateway to the world upon its separation from the north, which retains the name Sudan.

The government of Southern Sudan has all along eyed membership in the EAC, considered one of the most advanced in Africa, with a combined market of 140 million people. This is because a significant percentage of South Sudan’s trade is with East Africa, while it clears a big chunk of its goods through the port of Mombasa, Kenya.Currently, South Sudan is a net importer of goods from Kenya and Uganda as its manufacturing sector is still in its infancy.

South Sudan’s EAC membership may be easily achievable because it had already demonstrated its keenness to join the EAC even before the recent referendum. South Sudan will have to get full observer status while awaiting membership approval.Other factors favouring South Sudan’s EAC membership include geographical proximity as well as historical and cultural links.

During the British colonial rule, South Sudan was administered mainly from East Africa.
South Sudan’s interest in the EAC comes at a time when thousands of East African traders are flocking to its markets, reported to have extensive unexploited resources. The sectors open for foreign investment include mining, quarrying, energy and electricity generation, petroleum and gas industry, transport and information communication technology (ICT), tourism and hotel industry development, security services, freight and logistics and risk analysis.

Moreover, South Sudan has even bigger potential in mining and agriculture. With about 80 per cent arable land, South Sudan is capable of ensuring food security for the entire Eastern African region. Although it is currently a net importer of agricultural products, South Sudan has an outstanding natural resource base for the production of wide range of crops, forest trees, fisheries and livestock.

However, South Sudan will have to surmount many challenges for it to become a full EAC member.
First, it is coming at a time when the five member countries have made major steps, from a single Customs Union to the Common Market.

The region is now moving towards Monetary Union as it lays the ground for regional political federation. This is where the challenge lies for the south.The idea of a political federation for a region that has fought for 50 years to become independent might be difficult to sell to most South Sudanese.  Secondly, the south has to embrace democratic and best common practices that have been embedded within the other five member states. As it is, South Sudan is a largely militarized society, where the word of security forces is supreme.

Nonetheless, South Sudan’s emerging economy provides a wide range of opportunities for investments and trade.  In particular, Kenya, a country that played a key role in the Sudanese peace process, is looking at South Sudan as a new market for its manufactured goods and a source of employment for its citizens.

For its part, Uganda seeks a stable buffer on its northern border, not least to ensure that the rebel Lord’s Resistance Army (LRA) insurgency does not return into active rebellion.  Ugandan trade with South Sudan has tripled in recent years, with South Sudan being the largest importer of Ugandan goods.

Ethiopia, on the other hand, is both optimistic and lukewarm towards South Sudan’s independence. While the Ethiopian public has embraced South Sudan with many of them doing business in Juba, especially in hospitality and transport industry, the government is a bit jittery that an independent South Sudan will give examples to separatist movements in the south and east (Ogaden) of Ethiopia.