Economic vulnerabilities that will milk South Sudan into sunset

BY: GARANG ATEM AYIIK, Independent Economic Commentator, South Sudan, SEP/29/2014, SSN;

1. Introduction
John Perkins in his book, ‘Confession of Economic Hit Man,’ explained how he and his colleagues designed economic assistance programs in Saudi Arabia that will make huge in-flows of petrodollars to United States; and make Saudi Arabia more intertwined to United State economy.
The objectives, according to Perkins, was to make US benefits from Saudi natural resources; and inhibits Saudi from implementing punitive economic policies against the United States as she did in 1970’s during the Yom Kippur war. John illustrated how Countries around world were made vulnerable to be submissive to United States.

The programs in Saudi took forms of capital intensive programs with long term contracts management and maintenance provisions to keep United States in business in Saudi. The programs according to John were intended to ensure United States milk Saudi to Sunset economically.

Though the above scenario has different connotation, its applicability to South Sudan is precise. South Sudan got her independence in July 2011. She formed a government on a background of emptiness in terms of infrastructure, social services, institutions and human capital.

This circumstance provides an opportunity for wrong policy prescription in forms of assistance programs designed to disadvantage South Sudan economy.

2. Economic Vulnerabilities
This article explores possible scenarios economic agents with interest in South Sudan can design economic assistance programs with an intention to milk South Sudan till Sun set; identify South Sudan economic vulnerability to monitor and propose policy recommendations.

A two decade war eroded South Sudan social services, institutions, human capital and work attitude. As a result of these gaps, immediately after Comprehensive Peace Agreement, well wishers and self seekers ran into South Sudan by air, land and rivers.

Ten years later, an arm of experts, advisors and businessmen are rooted in South Sudan. The legitimate concern is why experts, advisors and businessmen haven’t passed on their expertise and altitude towards the local people and institutions?

The failure of capacity building in South Sudan can be explained by two reasons; tactical behaviors by consultants not to pass capacity to locals so as to retain their jobs; and tactical behavior by public employees not to employ capable locals to reduce knowledge pressure underneath them.

I am not a believer of lack of capacity but capacity mismatch. The above scenario has serious economic implications.

First, South Sudan will be indebted to capacity building;
— second, local resources will be repatriated out in forms of salaries and profits putting pressure on South Sudan pound;
— third, lack of employment will increase, increasing social problems and these are typical problems of economic hit men – economic vulnerability.

Any public officer or institution that benefited in forms of economic assistance for more than two years, thereafter has no capacity is guilty of the above explained selfish behaviors.

You must have met those consultants whose souls almost fade when their contracts expired.

Rwanda and Singapore demonstrated that countries that have confidence in their young people; place them central to economic policy; and encourage local content and solutions make long economic strides than those that depend on outsiders—- reduction of economic hit man influence.

After all, John Perkins explained that consultants and international institutions are first for themselves and their masters. So why do policy makers place these actors central to South Sudan economic needs?

In 2012, pissed off by behavior of Sudan, South Sudan halted oil flow through Sudan. Though this was a onetime decision, its lessons live on. Whether oil flows through Sudan, Kenya or Djibouti, it is possible that economic interests and geo-economic dynamics can halt oil flow. This is an area vulnerable to economic hit men.

An economy that runs on one resource is like a driver on long road without spare parts. The uproar caused in Uganda, Kenya and around the world by recent circular by Ministry of Labor in regulating foreign nationals’ jobs in South Sudan points to possible economic and diplomatic war in case interests clash.

It is a clear manifestation of how those who come to help live to protect their interest. South Sudan needs to reduce economic vulnerability by developing good roads networks with all its neighbors for possible road transport in case the existing pipeline(s) is compromised; develop local oil refinery for local consumption and possible exports and improve road networks links to existing refinery plan; and diversify productive sectors from oil.

Lack of a pipeline, refinery and huge dependence on imports through Kenya subject South Sudan to possibility of bullying, arm-twisting and name calling with little alternative and economic breathing space.

Perkins explained how international financial institutions and consultants suffocated nations with natural resources for economic vulnerability. This is done through huge loans for submissiveness, geo-economics and politics. South Sudan needs strong institutions on public loans so that she is not suffocated.

In 1970s, Malaysia used to send her employees to Kenya Institute of Management for training in Kenya, more than fifty years later, Malaysia has enjoyed economic growth as Kenya continue to swim in poverty and underdevelopment.

South Sudan needs to conceptualize her economic path like Malaysia. In a world built on capitalism; in a world where consultants and international partners have different interests as explained by John Perkins in his book; in a world where Kenyans demonstrated against Chinese working on Thika road and condemned South Sudan for acting in her interest in the same circumstance, South Sudan is better off in the hands of her Citizens.

3. Conclusion and Recommendations
South Sudan interests are better in the hands of South Sudanese. The government needs to integrate this into migration, labor policy and education financing. Do we need a circular when a permit and visa can do the job silently?

If South Sudan doesn’t have capacity, why doesn’t South Sudan take money to Universities where capacities are made!

John Perkins demonstrated that countries with natural resources are more vulnerable to world geo-economic and political dynamics. South Sudan needs to place its people, business and capacity central to economic expansion and policies to address economic vulnerabilities.

There are lessons from countries like Rwanda, Malaysia and Singapore that South Sudan can learn. Whether to be like Kenya or Malaysia, South Sudan has herself to choose. Central is the manner and capacity to make economically conscience decisions.

Garang Atem Ayiik is an independent South Sudan economic policy commentator base in South Sudan. He can be reached at garangatemayiik@gmail.com

8 Comments

  1. Bol says:

    Hi Mr Ayiik,
    You are right; we have to look inwards, not outwards. The gang of international expert are there for themselves and may not be that expert at all, otherwise they might have found employment in their homeland! Oil Refinery not its Export should be the priority as this will reduce the cost of agriculture production and translate into more jobs, food security, less import and more stable Pound.

  2. Defender says:

    Garang Atem,

    This is a well reasoned article. Some in the government see that showing power through decrees and swift move makes one powerful. This does not happen in today’s world. Diplomacy is the art of the possible and as you said, the government could have restricted labour mobility from neighbouring countries through the control of visas. But as the saying goes, the government has put the carriage for before the horse. The driving force for an effective employment policy in South Sudan is based on sound decision making that is studied and implemented without raffling feathers of your closest allies. This is specially important in the case of South Sudan, where it is vulnerable to outside influcences, left, right and centre.

    For example, Russia, one of the most powerful states, militarily and economically, is suffering the consequences of its decision to interfere in the affairs of one its former states–Ukraine, drawing rebuke from all the major economic powers. Now, Russians are facing the effects of economic sanction being imposed on it. The purchasing power parity of Russians is dwindling because of the arrogance of the Russian President in continuing to think in terms of pre 1989, golden years of USSR. The economic sanction that the west is unleashing on Russia is now beginning to bite and soon, you will see they will try to find an amicable solution that will save face, recoil the tail that was cut with the end of the cold war. This reality is something that cannot be ignored in the world where interconnectedness permeate everything.

    So, South Sudan cannot think of itself and an island protected from regional politics of interest. Developing a self sustaining instruments of development/reliance, then think of such drastic policies. Other then that, South Sudan will continue to lag behind the rest of the countries in the region. Why? because it is vulnerable to every political, economic and social pressure put forth by any of the three countries–Sudan, Kenya and Uganda.

    Sudan is the only route to selling our oil; Kenya is the only country that we receive our imports from and Uganda is the country that feeds us. How can a country in this situation think that it can dictate the terms of relationship that it currently has? I guess, only those who are living in the bubble that is called Kiir’s regime have the wherewithal to explain.

  3. MABE YOSIA says:

    I concured with you, permits and visas can do the work perfectly.

  4. Kong Puok Tongluot Finland says:

    Mr. Garang Atem
    You are alright, with a good article that concerned our economical weights in newly nation South Sudan. When you trying predictable comparing between Saudi Arabia economics progressive, you automiticly have proven of being good relationship between USA and SA, that was the most importance with economics phelosophy grows.

    In South Sudan country economics measured, we have no economics problem, because, we already gainned the massive resources, rainy season, lands, fisheries, foresteries, animals, oils mining and so on, then our problem is lack of good governance and corruptions. Thanks

  5. upiu says:

    Good points Garang,
    it’s very unfortunate that our political decision-making mechanism which is informed by advisors who’ve delinked themselves from institutions of knowledge (universities, colleges etc) carries serious flaws. one wonders as to where sound policies are going to come from if appointment is based on accomodation.
    however, those with sound and current economic knowledge, as you, are encouraged to keep floating their ideas/opinions via public domain for you never know when they will pick your brain.

  6. dau bol gak says:

    this is well captured article, i doult whether south sudan government will shift its ideological, the economic is the most imperative section in the country policies framework, i appreciate the articel

  7. False Millionaire says:

    Mr Garang:

    You are a good south sudanese man today as you ought to have been a good south sudanes boy before.It’s good to grow in one’s own country n you find yourself so free to fare with life the way you like.See our men’s affaires of heart when in a neighbourhood an awesome arrogant girl is the shining apple of the eye.So tempting n you go wild n too mad becouse your blood boils up beyond proportion out of disire for her.But she is too beyond reach.What do you?You konjor up the most down to earth sorcerer’s tricks to trip her.And it works n you enjoy the greatest feeling of unexpected rare success.But after that you go about your life becouse that is only what you had wanted of her.How does she feel after consumption n going to your trap was motivated by hope of a life long relationship?Thanks for your great article.It’s an enormous contribution but who would take notice of it when the awesome arrogant girl named south sudan is like an orphan on the cross road without a family?I am convinced,unfortunately,the cycle of economic blackmailing,exploitation n suffering will affect us for a very long time to come due to our good leadership vacum.

    I am sorry to add.But if this girl forced herself to your home,you would have no obligation to pay the dowery.All you do is enjoying n exploiting her as a second rated living object.At the end she is your exclusive property that would live n die under you leaving to your name all the childern that you would parent with her without any trace that she was ever born of a family.That is the most dangerous fate that is hanging over us in our beloved south sudan my great dear friend.

  8. okuc says:

    Dear Atem,

    As I said before the problem of South Sudan is the leadership. We need a leadership with vision unfortunately, SPLM led government is a failure. Let me, give you an example of late professor of Samani the first vice chancellor of Juba’ university in 1977. Pr Samani toured Europe to recruit SouthSudanese who were studying for Phds at European and USA universities to return to South Sudan and teach at Juba university.
    The gss should have done the same procedures in recruiting the SouthSudanese in disapora to return to SouthSudan for the Nation building with their knowledge and experise the gained in their adopted countries. Unfortunately, the so called liberators are not interested in educated Southsudanese and consequently we have the problem you described in your article.

Leave a Reply to upiu Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.