Unfolding business opportunities in South Sudan
By Honest Ngowi
economics made simple
Pngowi2002 This e-mail address is being protected from spambots. You need JavaScript enabled to view it , +255 754 653 740
On the July 9, 2011 the world witnessed the birth of the newest nation on earth. This is South Sudan which saw the light of the day as an independent nation following the Comprehensive Peace Agreement (CPA) with the Khartoum Government way back in 2005. The birth of this new nation among other things, unveils a number of opportunities for those within and outside South Sudan.
The author of this column is currently in Juba South Sudan for a short term assignment on building the capacity of the ministry of Finance and Economic Planning of the Government of South Sudan.
As part of his individual social responsibility, he would like to humbly share with the readers of this weekly column some of the potential business opportunities in the newly born South Sudan.
Governance institutions
As the new nation gets built amidst the background of war, there are many governance institutions, structures, systems, policies, strategies and positions that will need to be developed. Few existing ones will need to be improved in various ways. Given the rather very limited quantity and quality of sons and daughters of South Sudan to undertake these overwhelming functions one sees opportunities for outsiders including Tanzanians.
The need for advisory, supportive, technical assistance, mentoring and coaching positions as part of capacity building and enhancement in South Sudan should be foreseen by enterprising minds. For institutions and individuals who are willing and able to tap such opportunities, it is a matter of acting and acting before it is too late.
Physical infrastructure
Parallel to building institutions of governance the Government of South Sudan will need to build a number of physical infrastructure. These include roads, bridges, railways and power supply. Keeping in mind that South Sudan is larger than Uganda, Rwanda and Burundi put together, the kilometres of roads that have to be built in this country with huge petro-dollar potential are colossal and provide huge opportunities. Other badly needed infrastructure is in the area of real estate for public and private sector.
A mere observation in Juba clearly shows huge needs for buildings for public sector in form of government offices. Some offices are currently in prefabricated houses and need replacement soon. Government officers still stay in hotels due to accommodation problems.
There is huge demand for accommodation for private/residential market as well as offices. There are foreseen individual as well as corporate movers and shakers world will be locating to South Sudan to tap the economic potentials of this seemingly sleeping giant. Cost of accommodation in Juba is not below $100$ (over Sh150,000) per night for a very normal hotel.
This is a hotel that would have cost not more Sh40,000 in Dar es Salaam. The figures tell it all about deficits in this market where the supply is much short of demand despite of rather rapid construction works.
The infrastructure sector therefore provides myriad of opportunities. They range from designing; supply of inputs like manpower of various levels, building equipment and materials like cement and steel; actual implementation of construction work and many more as limited by imaginations and the sky.
Contractors who feel squeezed out by larger and more powerful competitors in Tanzania and indeed in other countries may get a relief in South Sudan where the market does not seem to be saturated.
Small and big businesses
In Juba, small businesses including kiosks, restaurants, hotels, water selling, secretarial services including Internet cafes are dominated by small entrepreneurs from Kenya, Uganda, Ethiopia, Eritrea and China. The latter are also in rather big businesses such as in Juba Beijing Hotel. Banks from Kenya such as Kenya Commercial Bank and Equity Bank have already been on the ground in Juba long before the independence of South Sudan.
One wonders where Tanzanians are. It is known that Exim Bank of Tanzania is present in Eritrea but no Tanzania bank has extended its tentacles to Juba. Services like insurance, microfinance, consultancies and many others are still short of supply in relation to demand for the same. Researchers and advisors in the dynamics of internationalization process of small and medium size enterprises (the author of this article included) have a lot to study in this area.
Supplying basic goods
Most basic goods including foodstuffs like rice, maize, beans as well as banana are imported to Juba mainly from Uganda and Kenya. This also applies for textiles, beer, soap and other basics. Hotels, guest houses, restaurants, bars as well as camping sites are mostly owned by Kenyans and Ethiopians.
The only commodity of Tanzanian origin that was observed in some Juba shops is Azam maize flower. Besides this ‘made in Tanzania’ commodity one can spot some Maasai herbal medicine traders in Juba. But it cannot be said for sure that Maasai entrepreneurs are from Tanzania as they might be originating from Kenya or Uganda as well. Back in 2006 there were some onions from Mang’ola valley in Karatu on sale in Juba. If and when South Sudan joins the East African Community (EAC), the business opportunities will be more magnified given the common market status of EAC. But it will only benefit those who make themselves ready.
Implications for Tanzania
The private sector generally has to identify, scan and scope the opportunities and share with others as partly done in this article. The sharing can also be done in seminars, workshops and business meetings.
It only needs courage, aggressiveness, boldness and confidence to benefit from the uncountable unfolding opportunities in South Sudan. At the level of the government, it would be a good idea to set up a Tanzanian representation on ground in Juba with a focus on inter alia, economic diplomacy to identify and concretize the many unfolding opportunities in this great virgin land of South Sudan. .
The author is a lecturer at Mzumbe University Business School
http://thecitizen.co.tz/business/-/13917-unfolding-business-opportunities-in-south-sudan
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