South Sudan Economic Crisis Easing on Sudan Ties, Minister Says

  • Sudan ordered reopening of border in January to boost trade
  • Oil production in South Sudan rising as conflict eases

Sudan’s reopening of its border with South Sudan will help to ease an economic crisis in the world’s newest nation that’s caused the currency to collapse and inflation to surge, South Sudanese Foreign Minister Barnaba Marial Benjamin said.

The government announced in January that the border would open for the first time since South Sudan seceded from Sudan in 2011, allowing a flow of cheaper goods. Growth in the East African nation’s economy contracted 5.3 percent last year, according to International Monetary Fund data, because of a two-year civil war that’s curbed oil production.

“Opening the border will enhance the process in order to get out of this economic crisis we are in,” Benjamin said in an interview in Arusha, Tanzania, where he is attending a summit of regional leaders. The country’s pending membership of the five-nation East African Community will be discussed at the meeting.

Sudan sealed its borders with South Sudan in 2011, after accusing President Salva Kiir’s government of supporting rebels on Sudanese territory. The reopening signaled a further rapprochement between the two countries and followed an announcement earlier in January that Sudan will renegotiate fees it charges South Sudan for oil passing through its territory.

Oil Production

Landlocked South Sudan has sub-Saharan Africa’s third-largest oil reserves and currently pumps about 160,000 barrels a day. The government in Khartoum exports its neighbor’s crude through pipelines to a port on the Red Sea and collects a fixed price per barrel in transit fees.

Oil production is rising in South Sudan as the country reopens oilfields that had been closed because of the conflict, Benjamin said. Crude is pumped in Upper Nile and Unity states in the northeast of the country.

“In the Upper Nile area it has never stopped, even during the conflict, only the production has reduced,” Benjamin said. “Now the production is going to go up and in the Unity state where the oilfields have closed because of the crisis, now they are opening up again.”

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