Since December 2013, South Sudan has continued experience conditions of civil war. The conflict is mainly attributed to the fallout between President Salva Kiir and Vice President Riek Machar. Since 2015, there have been several efforts to mediate and restore peace to South Sudan. In 2019, the Intergovernmental Authority on Development (IGAD) brokered a peace agreement that targeted the reunification of armed forces, states and boundaries. This agreement was expected to deliver a unity government by 12th November 2019. However, the formation of the unity government was extended to February 2020. This development coincides with the African Union Vision of Silencing the Guns on the continent by 2020. Given that South Sudan was an important trading partner for Uganda before the civil conflict, attaining peace and ensuring stability in South Sudan has the potential to benefit Uganda immensely. Beyond trade benefits, countries that neighbour South Sudan are also concerned about potential war spillover effects such as the associated influx of refugees and the delay in full integration of South Sudan in the EAC. Therefore, if realised, the restoration of peace in 2020 will have the following implications for Uganda.
The restoration of peace and security is likely to improve trade outcomes in the EAC. The big threat of the conflict to Uganda is its direct impact on trade (especially informal trade). For example, Uganda’s informal trade export earnings to South Sudan decreased from US$ 119 million in 2014 to US$ 47 million in 2017 whereas the formal trade export earnings increased from US$ 160 million in 2014 to US$ 252 million in 2017. Therefore, if peace is achieved, the trade between Uganda and South Sudan could initially double especially with the manufactured and food products such as cereals and sugar products. However, this outlook is conditional on the increase in the incomes of the people of South Sudan—especially arising from oil revenues.
In addition, the restoration of peace might impact efforts towards deeper integration with other EAC countries. Since joining the EAC in September 2016, South Sudan’s regional integration efforts have been undermined by ongoing conflicts. It has also been criticised for insecurity, failure to protect East African businesses and to contain runaway inflation and economic decline. Therefore, the return to peace would pave the way for the consolidation of peace, rebuilding of the economy and strengthening of institutional capacities for economic management.
The other outcome of the conflict relates to the displacement of people. The refugees from South Sudan are staying in Uganda as a result of the escalation of the inter-tribal (community) and political conflicts. Therefore, a return to peace in the region is likely to result in the return of refugees to their country to be reunited with their families or to start a new life. This would result into reduction of pressure on land and other resources in the refugee settlements and a reduction in trade in the refugee settlement areas.
Furthermore, because of the rising food insecurity exacerbated by the conflict and the recent flooding, the restoration of peace would result into food security. In the short run, some of the food and agricultural products will have to be imported from Uganda which has peace and a relatively good agricultural season. The demand for Uganda’s food products is expected to increase agricultural food production and exports of food products. In the long term, however, the food exports will reduce as peace will guarantee that some food products are grown in South Sudan.
As such, the realisation of peace in South Sudan will ensure great trade and economic gains for South Sudan, Uganda and the EAC. This will arise from the peace dividends and return to gainful economic activities.
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