5 July 2012

South Sudan: One Year On, Nation Falters Under Failing Economy

press release

One year after South Sudan's independence on July 9, the young country is facing its worst humanitarian crisis since the end of the war in 2005, under the weight of severe economic meltdown and ongoing conflict. Long-term and emergency efforts to help nearly half the population, who don't have enough to eat, could be derailed by an economy out of control, warned the international aid agency Oxfam.

Vital spending on infrastructure and services such as new roads, schools, healthcare and water systems is being slashed, as the country faces economic catastrophe. The price of food and fuel has reached unprecedented levels. Inflation shot from 21.3 percent in February to 80 percent in May, pushing essential food and supplies way beyond the reach of ordinary people. Half of South Sudan's 9.7 million people are facing food shortages - more than double the number last year.

In South Sudan's Upper Nile region, where Oxfam is delivering water and sanitation to refugees who continue to flee fighting in Sudan, inflation and conflict have forced fuel prices up by 111 percent. A 200-liter barrel of fuel now costs up to $1600, compared to $600 in January this year. One barrel used to pump water into Oxfam's water tanks for the 32,000 people in Jamam refugee camp lasts just two days.

A daily struggle to survive

"The jubilation of independence is now tempered by the reality of a daily struggle to survive," said Helen McElhinney, Oxfam policy advisor. "Some people are living on one meal a day and double the number of people are in need of food aid compared to last year. Refugees are enduring dire conditions in border camps with not enough water to go around. The Government of South Sudan must work with the international community to urgently put the fragile economy back on track to prevent the world's newest country from plunging deeper into a protracted crisis."

An increase in hostilities since last year between Sudan and South Sudan has severed trade, cutting off the vital flow of people, fuel and goods, affecting the ability of people to earn a living. In border states, markets are almost bare and prices for staple foods, such as a tin of millet, which feeds a family of five for two days, have quadrupled. The value of the South Sudanese pound has plummeted against the dollar, leaving small traders unable to stock market shelves with imported goods, which the country relies heavily upon.

South Sudan's great potential

South Sudan is increasingly reliant on food aid. Yet with peace, a stable economy, and investment in its future, South Sudan would be more than capable of feeding itself, Oxfam said.

South Sudan is rich in fertile soil and water, but less than five per cent is cultivated. The years following the Comprehensive Peace Agreement allowed agriculture to flourish, and in 2008 what was then southern Sudan produced a bumper cereal crop due to good rains and government support, making it self-sufficient in its staple crop for the first time.

"South Sudan has the potential to feed itself, and could be a bread basket for the region. Instead, renewed conflict and severe economic downturn means more people face food shortages now than since the 2005 peace deal, which ended Africa's longest civil war. We must not allow the large investments in agriculture, water, education and other services be undone by the economic crisis and increase in conflict. The longer this crisis drags on, the greater the risk South Sudan's development will slip backwards, and its vast potential will be unrealised," said McElhinney.

Oxfam called on the Governments of both countries, with the support of the international community, to refocus on the AU-led negotiations, and for donors to ensure that both immediate humanitarian and long-term development needs are addressed.

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