The Republic of South Sudan became the world’s newest nation and Africa’s 55th country on July 9, 2011, following a peaceful Referendum in January 2011. The referendum was foreseen as part of the 2005 Comprehensive Peace Agreement (CPA) signed by the Government of the Republic of the Sudan and the then southern-based rebel group, the Sudan People’s Liberation Movement, after decades of conflict.
As a new nation without a history of formal institutions, rules or administration accepted as legitimate by its society, South Sudan must build its institutions from scratch. Core administrative structures and mechanisms of political representation are only beginning to emerge, and the government still struggles to provide basic services to the population. Outside a few oil enclaves, South Sudan remains a relatively undeveloped, subsistence economy.
South Sudan has vast and largely untapped natural resources and opportunities abound for visible improvements in the quality of peoples’ lives, but there are also many challenges. Geographically large (about the size of France), South Sudan is sparsely populated with more than 200 ethnic groups and little sense of shared nationhood. South Sudan is the most oil dependent country in the world, with oil exports accounting for almost the totality of exports, and for around 80% of gross domestic product (GDP), directly and indirectly. GDP per capita of South Sudan in 2010 was equivalent to US$1,505, while the preliminary estimates for 2011 indicate a GDP per capita of US$1,858, which is much higher than its East African neighbors, mainly due to oil production. Sudden suspension of oil production in January 2012 is expected to reduce a GDP per capita at US$785.
Gross National Income (GNI) per capita was much lower at US$984 in 2010, reflecting the large income outflows to oil companies. On current reserve estimates, production is expected to reduce steadily in future years and to become negligible by 2035. Prior to the oil shutdown in January, 98% of fiscal revenue came from oil. The budget for 2012-2013 was SSP 9bn (around $3bn), supplemented by $1bn of development assistance, and another US$ 300 million of humanitarian assistance. Outside the oil sector, livelihoods are concentrated in low-productivity, unpaid agriculture and pastoralists work, which accounts for around 15% of GDP. Eighty-five percent of the working population is engaged in non-wage work, chiefly in agriculture (78%).
The South Sudanese economy has been plagued with high inflation in the 12 months following independence, reaching 80% during the year, but price increases are expected to be moderate in the end of 2012 at 17%. Over the past year, inflation has been driven mostly by increases in food prices. Limited local food production and a high reliance on imported foods, in combination with depreciation of the South Sudanese Pound (SSP) and the border closure in the North, have driven price increases in the past year. All economic issues now focused on the decision by the Government of South Sudan (GoSS), on January 20, 2012, to shut down all its oil fields as part of its dispute with Sudan over a range of post-secession issues. The GoSS has adopted ‘austerity measures’ in response, involving cut of around 30%, mainly to government consumption, transfers to the states, development budget and 50% cut to housing allowance but without touching the wages and salaries. In Addis Ababa on September 27, 2012, an agreement was reached between Juba and Khartoum on the mechanism to market oil, which had raised the hope that the oil production may resume early 2013. However, a disagreement on the manner of implementation of the agreement stalled the agreement until mid-March 2013, when the two countries agreed on the matrix of implementing the agreement. This matrix has renewed the hope that oil from South Sudan may flow again by mid-2013.
South Sudan, with an estimated population of 8.3 million, is bordered by Ethiopia to the east, Kenya, Uganda, and the Democratic Republic of the Congo to the south, and the Central African Republic to the west. At 644,329 sq. km, it is roughly the size of France, but with just under 1/3 of the population, giving it a population density that is less than one tenth of neighboring Uganda. The population is very young, with 16% under the age of five-years-old, 32% under the age of 10-years-old, 51% under the age of 18-years-old and 72% under the age of 30.3 years old. The population is largely rural with 83% residing in rural areas.
The Government of Southern Sudan began earnestly working on the development of Southern Sudan (as it was then known) after the signing of the CPA in July 2005, with the support of development partners. However, the task was extremely challenging. It had virtually no road or water infrastructure then, and no paved roads in and outside of its capital of Juba. Structures for service delivery were practically nonexistent.
Despite the substantial achievements of the last seven years, the development challenges facing the new nation remain significant. The civil war that lasted over 20 years took an enormous toll and left South Sudan impoverished. Over half of the population lives below the poverty line, and human development indicators are among the worst in the world.
Only 27% of the population 15-years-old and above is literate. In 2009 there were 129 students per classroom. The literacy rate for males is 40% compared to 16% for females. The infant mortality rate is 105 (per 1,000 live births), maternal mortality rate is 2,054 (per 100,000 live births), and only 17% of children were fully immunized. Fifty-five percent of the population has access to improved sources of drinking water but 38% of the population has to walk for more than 30 minutes one way to collect drinking water. Eighty percent of the population does not have access to any toilet facility. Meanwhile, 15% of households own a phone (59% in urban areas compared to eight percent in rural areas.) South Sudanese want to see marked improvements in these indicators, and in job opportunities and economic prosperity, and have high expectations that independence will deliver them.
Last updated April, 2013