The Scramble For The Southern Sudan

On 9th January 2005, after three years of intensive negotiations Sudan’s civil war came to an end when the two warring parties, South Sudan and Northern Sudan, signed the Comprehensive Peace Agreement (CPA) in Nairobi, Kenya. While this pact ushered in a new chapter for Sudan, to neighbouring countries and superpowers alike, it signalled a scramble for a piece of the pie that is South Sudan.

A race for South Sudan’s resources has been intensely under way over the last five years, with the US, China, India, Norway, Ethiopia, Kenya, Uganda and South Africa are in the forefront.

Other players involved include Malaysia, Sweden and some members of the Arab League. All these countries have embassies and consulates in both Juba and Khartoum. At stake are South Sudan’s massive oil boom, lucrative mining, infrastructure, telecommunications, medical supplies, educational, tourism, agriculture, supplies and defence contracts.

Tales of large-scale bribery, underhand dealings and official malfeasance underscore the real ‘scramble for South Sudan’. Accusations of corruption among ministers continue to dog President Salva Kiir’s new cabinet.

In more ways than one, these factors not only affect the economies of all these countries involved but also shape their foreign policies and realign their international relations and obligations. In other words, there has been a radical paradigm shift within South Sudan, largely driven by the profit motive.

Battle for land leases

The scramble for Juba also extends to large land-based investments sometimes referred to as ‘land grabbing’. Foreign interests have managed to secure some 5.74m hectares of land for agriculture, forestry, biofuels, eco-tourism and carbon trading.

Leading the pack in the large land-based investments is Al Ain Wildlife, a United Arab Emirati outfit which has been granted a 30-year lease on the entire Boma National Park covering 2,280,000ha in the Eastern Equatoria and Jonglei States. Al Ain Wildlife intends to construct hotels, tented resorts and promote conservation.

Some 75km out of Juba, in the Central Equatoria State, an American company, Nile Trading and Development, has leased 600,000ha to ‘develop, produce and exploit timber and forestry resources on the leased land’. In the lease agreement, Nile Trading and Development has a right to extend its investments to 1,000,000ha.

In Unity State, another US firm, Jarch Management, has already leased some 400,000ha for agribusiness and negotiations are still underway for a further 400,000ha.

Prince Badr bin Sultan of Saudi Arabia has been granted a 25-year lease on some 105,000ha in Gwit for agricultural purposes.

Others involved in seeking large-scale land-based investments in South Sudan include Central Equatoria Teak Company (UK/Finland), Madhvani (Uganda), Green Resources (Norway) and its South Sudan subsidiary TreeFarms, Blue Lakes (Kenya), MAJ Foundation (India), Fenno Caledonian (Finland), Citadel Group (Egypt), and the Australian outfit Concorde Agriculture.

Africans toe to toe with multinationals

Interestingly, the scramble for business in Juba has seen strong African entrepreneurs going toe to toe with the more monied US, UAE, China, EU and Indian firms. Leading African nations entrenching their businesses in South Sudan include South Africa, Kenya, Uganda, Ethiopia and Egypt.

South African interests kicked off in earnest in 2004 when Mechem, a subsidiary of Denel (the South African arms parastatal), began its demining operations in South Sudan. Mechem, which is known globally for its mines removal and battle grounds clearance, is still undertaking its operations in South Sudan today. As of last year, it had cleared 9,050km of road, removing 3,237 anti-personnel, unexploded ordinances (UXO) and anti-tank land mines.

This is only a tip of the iceberg of South Africa’s involvement in the country. South Sudan is said to purchase much of its weaponry from Denel and even the training of its key security personnel is conducted by the South African Defence Forces (SADF). During South Sudan’s Independence Day celebrations, the entire South Sudan airspace was secured and manned by SADF.

Recently, the South African Department of Foreign Affairs (DFA) and Department of Trade and Industry (DTI) have intensified their engagement with the country, paving the way for an influx of South African businesses.

In February 2009, a Breakfast Roundtable hosted by the DFA brought together South African business magnates and Government of South Sudan (GOSS) ministers; this opened the floodgates not only to private South African firms but also government parastatals.

In July 2009, the DTI led some 20 South African public and private sector companies on a trade and investment mission to South Sudan. The 20 companies covered telecommunications, agriculture, forestry, water purification, timber, financial services, infrastructure development, energy and minerals.

Joint Aid Management (JAM) a South African firm, has been granted a 32-year lease for some 24,300ha in Yambio, Western Equatoria State, for agribusiness while SABMiller, as stated earlier, has invested over $70m. New Kush Exploration Company, registered in both South Africa and the UK, has been awarded several exploration rights for gold and uranium in South Sudan.

At the heart of these business deals is the South African-Sudanese Joint Business Council. Spoornet, Denel, Arivia and Safcol, among other South African entities, have all been awarded contracts to develop the timber, technology, infrastructure and defence sectors. Uganda, Kenya and Ethiopia too have not been left behind. Immediately after the South Sudanese voted for secession, Nairobi advanced a grant of $4m to Juba. This had already seen Kenyan financial institutions and banks – Equity Bank, Kenya Commercial Bank, Kenya Airways and UAP Insurance – slugging it out with the Commercial Bank of Ethiopia and Ethiopian Airlines in the scramble for business.

Officials in Juba have already confirmed that in the near future, Kenya’s Cooperative Bank will be launching its South Sudan subsidiary, as will South Africa’s Stanbic Bank. South Sudan is the new frontier of African business.