South Sudan: Development plans for a new nation

War and other forms of violence continue to absorb critical foreign assistance that could otherwise be used for social and economic development. In fact, no conflict-affected country has been able to reach any of the United Nations Millennium Development Goals (UN MDG) – a collection of the broadest and most basic global development indicators. The World Bank indirectly acknowledged this reality in its World Development Report 2011 which concludes that insecurity has become the “primary development challenge of our time.” The 2011 report was developed to inform the World Bank’s funding and operational strategies for several violence-afflicted countries, including the world’s youngest country South Sudan. Last week on July 9, the Republic of South Sudan gained independence from its northern neighbor Sudan in what was the culmination of a peace process dating back to 2005 following many years of devastating civil war. Regrettably, independence celebrations have been quickly tempered by the colossal task of building a nation in which one in six children die before they reach their first birthday. According to the U.N. Office for the Coordination of Humanitarian Affairs, over 190,000 people were displaced by inter-ethnic and armed conflicts in Southern Sudan in 2010. In 2009, the figure stood at approximately 391,000. To this day, border disputes, ethnic clashes, citizenship and migration issues, and disaccord over oil revenue sharing continue to characterize relations between the North and South. Three critical and oil-rich border areas – Blue Nile, Southern Kordofan, and Abyei – hold special status under the Comprehensive Peace Agreement (meaning they are not yet officially part of the North or South) and remain under siege from the North. These dynamics have led some analysts to conclude that the areas are actually closer to conflict now than they have been since the 2005 CPA. None of this bodes well for the future of South Sudan, but most agree that properly channeled and coordinated foreign assistance is the only source of hope. Regrettably, diplomats, development practitioners, and civil society continue to question the slow and overall poor response to the development needs of the new nation. For many, foreign donors have simply not lived up to their promises to build a truly viable state. So what international donor money is or will be available to implement more sustainable development strategies and programs necessary for establishing a functioning South Sudan? Currently, the World Bank is managing the $545 million Southern Sudan Multidonor Trust Fund. Established in 2005 through funding from 14 donors, the MDTF was created to counter the accountability and administrative limitations of the then interim Government of South Sudan. Nearly all those with a stake in the MDTF – the South Sudan government, donors, NGOs, and civil society – have disparaged it for inefficiency and inflexibility despite disbursements of $188 million in 2010 alone. Last June 15, the World Bank board of directors proposed the creation of its own $75 million trust fund to help develop infrastructure, create jobs, and provide health care services for the new country. The U.S. Agency for International Development and European Union have also developed plans and financial instruments in anticipation of South Sudan’s enormous development and economic challenges, but many of these initiatives are not yet past the planning stage. USAID has released a three-year development strategy for South Sudan’s post-CPA development. While humanitarian aid is still a priority, the agency will focus on strengthening and reforming the security sector in order for it to adequately deal with conflict matters, building and improving infrastructure for water and sanitation, health, education and agricultural development from 2011 to 2013. The U.S. government requested $518.3 million in financing for a unified Sudan for fiscal 2012, with the bulk of funds earmarked for peace and security. While the U.S. has said that it will host an international engagement conference for Southern Sudan, no details on the event have been released. In May, the Council of the European Union provided €200 million ($282.2 million) in development aid for Southern Sudan in support of the council’s 2011-2013 development plan. The funds are programmed for projects in the education, agriculture, food security, health and democratic governance sectors. The African Development Bank and United Nations are also among the major donors setting aside funds for the new nation. The African Development Bank is developing a comprehensive multi-year operational development strategy for South Sudan and is considering the nation’s application for membership. Last June, the United Nations launched an aid appeal for South Sudan, saying it needed $200 million to respond to the humanitarian crisis there. The United Nations Development Program has been working with South Sudanese officials over the last five years by “providing technical assistance, mentoring and direct financial support.” Finally, considering pre-succession Sudan was the third-largest oil-producing country in sub-Saharan Africa and 80 percent of the oil lies in the south, oil wealth could represent another stream of money for sustainable development. Yet, there remain very important questions over how oil wealth can best be targeted toward development and how development agencies can help ensure that happens. South Sudan Cabinet Affairs Minister Kosti Manibe Ngai recently admitted that the “oil money has not been well spent,” suggesting instead that oil money was spent on security programs to counter potential aggression from the North, rather than development programs. If properly managed, the oil money can help build the necessary national and local institutions to spur political unity and economic growth, perhaps even breaking the region’s cycle of violence. As many other nascent countries have experienced, however, it can also serve as a source of division, violence, greed, and impropriety. Some argue that the presence of oil in South Sudan is inevitably a curse because it deflects critical attention from more inclusive growth initiatives in sectors such as agriculture. Louie-An Pilapil contributed to this report.