Present Situation & Future Developments of the South Sudanese Business Sector
7 min readGovernment of South Sudan Minis try of Finance&
Economic Planning
Presentation by H.E Kuol Athian Mawien
Present Situation & Future Developments of the South Sudanese
Business Sector
Hamburg, June 20, 2008
Ladies and Gentlemen,
Firstly, I wish to thank you for inviting me to this seventh German-Sudanese Business
Forum. It gives me great pleasure to be able to outline to you the current situation of
the Business Sector in Southern Sudan, and or policies for its future development It is
my hope that in doing so, I may encourage some of you to come to Southern Sudan,
and explore the business opportunities available there.
There are enormous opportunities in Sudan in general and Southern Sudan in
particular for investment. Peace has come to Southern Sudan after many decades of
unrest. We are confident that peace will be a way of life for the Southern Sudanese.
Our aim now is to develop a peaceful and prosperous nation, and we are fortunate to
have oil revenues with which to finance our development. It is our aim to use our oil
revenues wisely, so that we develop our infrastructure and stimulate investment. This
will enable our people to enjoy a higher standard of living, and will enable us to
develop our tax base, so that in the end, we have a viable alternative to oil as a source
of agriculture.
Traditionally, Southern Sudan’s strength has been in the field of agriculture=;
Southern Sudan is blessed with a good climate, fertile soil and unpolluted
environment. Now, due to the displacement of our people, and the devastation
wreaked by war on our productive base, we are importing food. However, our
potential to supply our domesticate market and export our surplus is huge. There is
potential for those wishing to invest in cash crops as well. Tea, coffee, rice, gum and
maize have traditionally been produced in Southern Sudan and there is potential to
scale up activities in this sector.
In light of the current global increase in food prices, agriculture is an area which
investors should take very seriously.
Potential for tourism, particularly wildlife tourism is also great. Because of civil strife,
the environment has been untouched and even today, wildlife in its thousands can be
viewed easily in many parts of Southern Sudan. We have huge potential to develop a
niche wildlife tourism market for game viewing and bird watching. The Nile can also
be the single biggest draw for tourists to Southern Sudan. There is tremendous
potential for water sports and investors in the cruise business.
More broadly, in terms of the tourist industry, we need investment in the form of
hotels all over Southern Sudan; Hotels are needed in large numbers, and needed
quickly, in Southern Sudan. The number of investors, international civil servants, and
staff from NGOs who are coming into Southern Sudan is increasing every day. Flights
to Juba are generally full, which is an indication of the increasing number of people
coming into Southern Sudan. Current accommodation is basic and needs to be
upgraded. Returns are high in this field and there is enough space for many more
investors.
Southern Sudan is also rich in oil, minerals, including gold and diamonds, and ore. We
welcome investors to prospect for minerals in Southern Sudan and establish
manufacturing units here. We look to the establishment of manufacturing units in
Southern Sudan. Land is easily available for those who wish to set up manufacturing
units in Southern Sudan. We want to realize the benefits of value addition to our raw
materials, through transfer of technology to the South, instead of seeing the benefits
accrue to countries abroad.
At present, we import all our manufactured products, as well as aggregates such as
cement. Given our landlocked natured, our reconstruction needs, and our demand for
construction materials, this is not cost-effective for us. We would therefore like to
encourage import-substituting production of manufactured and processed products
for the local market, and capacity for cement production.
This policy of industrialization and value addition is necessary in order to provide
skilled and semi-skilled employment to the under-employed and unemployed,
particularly in the agricultural sector. We believe that investment in human capital will
deliver significant gains to our economy, particularly in the area of agro-processing
and light manufacturing for the domestic market, and this should be a particular target
for investment.
For those interested in significant capital investment, the Nile has the potential to
generate enormous hydroelectric power. Neighboring countries are hungry for power
and Southern Sudan itself will need more power with each passing month. We look to
investors to join with us in this huge challenge.
Based on the needs that I have outlined, as well as our potential, we welcome
investors and investment. However, we would like investors to work for the benefit of
Southern Sudanese. This does not men that we will restrict the ways in which you can
invest here. You can invest through any number of channels; you can invest directly,
make use of local agents, or go into partnership with local businesspersons. However,
any investment should be mutually beneficial. Southern Sudanese have suffered long
and have suffered a lot by way of deprivation and poverty for decades. We want the
benefits of peace and development accrue to all Southern Sudanese.
Any investment in Southern Sudan should generate employment for South Sudanese.
That is an essential pre requisite. I have heard people say that the capacity of Southern
Sudanese to handle hi-tech jobs is limited. My answer would be that if Southern
Sudanese are trained they will be as good as anybody else will in the world. We look
to investment as a means of transferring technology and enhancing skills acquisition in
the South. As far as we are concerned, technology transfer through foreign direct
investment is one of the leading ways of accelerating our development. I will enable us
to increase our skills base, raise our productivity, and enhance our output.
As a government, we know that we cannot just stand by, and expect investors to
come to the South of their own accord. We must ensure that the environment we
provide is conducive, and work to make Southern Sudan an attractive investment
destination for innovative investors with a keen eye for emerging business
opportunities. We are in the process of developing business-friendly laws and policies,
and are committed to guaranteeing freedom of economic activity. We do not place
restrictions on flow of capital, either into or out of the country and likewise, we
guarantee free movement of people and capital goods. We are committed to the
principles of market competition, and have put this into practice in our own
procurement policies.
The government of Southern Sudan, through its oil wealth, is the single biggest actor
in the Southern Sudanese economy at present, and our policy
of competitive procurement acts as an important stimulant to private sector growth.
More broadly, the government of Southern Sudan has recently defined its six top
expenditure priorities for the period 2008 – 2011. Three of these are directly linked to
our objective of stimulating private sector-led development in Southern Sudan. We
have placed a priority on maintaining security, which is a pre-requisite for investment.
We have prioritized the development of road infrastructure, which is essential for the
development of markets. In addition, we have prioritized the development of our
productive capacity in the agricultural sector, to ensure that our population, the
majority of who live in the rural areas, are food secure and able to engage in market
activities.
Finally, as I conclude, I wish to touch briefly on the issue of the financial sector. To be
frank with our commercial banking system is still in its infancy. We know that this is
not a constraint to foreign investors, who have access to capital abroad. Nevertheless,
we would like to attract investors to come into our financial sector, so that in turn our
local businesses can benefit from access to credit through the local commercial
banking system.
In conclusion, the situation in Southern Sudan has come back to normality. There is
now stable and friendly investment climate which guarantees security of investment,
freedom to set up business enterprises, and repatriation of capital. The government of
Southern Sudan actively wishes to encourage investors to come and identify for
themselves the business opportunities available in the South in all areas. Our private
sector, and our markets, are probably some of the least developed in the world. Most
people would probably see this as a challenge. However, we believe that businessminded
investors will also see it as a huge opportunity. Working in partnership, and
through wise use of our oil revenues, we believe the South has the opportunity to reap
the gains of private sector development.
I once again wish to thank you for giving me the opportunity to meet with you today.
7th German-Sudanese Business Forum, Hamburg, Germany
June 20th, 2008
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