Businessmen visit South Sudan for investment opportunities
Mar 29, 2006 (NAIROBI) — A group of foreign investors with a combined investment portfolio of about 100 million U.S. dollars left Wednesday for southern Sudan to explore opportunities created by landmark peace deal.
The more than 20 investors, mostly Asian and Kenyans, will be seeking opportunities in the vast oil, gas, telecommunication, infrastructure, pharmaceutical and business support sectors, said Malei Nthiwa, the program director of Bread of Life Africa (BOLA), the firm which is coordinating the trip.
Speaking before their departure, Nthiwa said his organization has started making concrete plans for investors to exploit the vast Sudan market, unlocked by the signing of a landmark peace agreement which ended the 21-year civil war between the ex-rebels and Khartoum government.
“The delegation will visit the southern Sudan’s main town of Juba, Rumbek and Yei where they will hold high level discussions with government of southern Sudan officials and also get first hand information on how to set up businesses there,” he added.
The visit follows the recently concluded investment conference in Nairobi early this month where foreign firms sought ways of tapping immense business opportunities in the region after more than two decades of civil war.
“As I predicted that after investment conference, oil and gas companies will rush in to expand Sudan’s oil production from the 500,000 barrels a day recorded last year. This is exactly what we are witnessing today and this trip can attest to that fact,” said Nthiwa.
Sudan has proven reserves of 635 million barrels, much of which could not be accessed during the war because of fighting.
Under the 2005 deal, oil revenues are split roughly 50-50 between the north and south.
Nthiwa said foreign firms willing to invest in the vast region have expressed concern over poor infrastructure in southern Sudan, legalization of commercial documents and non-availability of market information including potential buyers and distribution outlets.
However, Nthiwa said the southern Sudan authorities are addressing lingering concerns over business licensing and the operations of private businesses in the largely under-developed region.
He said the semi-autonomous government was rapidly transforming itself from a rebel movement to a government capable of restoring unity and confidence in the people of southern Sudan.
Nthiwa said South African companies, many with experience working in countries emerging from conflicts such as Mozambique, Angola and Congo, are aggressively moving into Sudan.
“Southern Sudan is going to be number one in Africa and the world for investment because it’s a large country and the infrastructure is zero. People need buildings, power, highways, hospitals — they need everything,” Nthiwa said.
He said Kenyan manufacturers of steel, cement, household and industrial goods will be the immediate beneficiaries of the new market as southern Sudan begins its reconstruction.
Reconstruction of the southern Sudan will have to be preceded by the building of roads to enable relief supplies reach the intended people residing in hard-to-reach pockets.
“There are almost no roads connecting the south with the rest of the country and neighboring nations, and in most cases, the few available are either still mined or usable only during the dry season,” said Nthiwa.
“Clean water and electricity are virtually nonexistent in much of the south, which has had no investments or business in decades to generate jobs for its people, the majority of whom live from hand to mouth,” he added.
Nthiwa said investors will confirm first hand that peace had returned to southern Sudan and that investing there will make sense.
He said southern Sudan could record some of the highest growth rates ever witnessed in Africa if the fragile peace holds.
Last year, donors pledged more than 4 billion U.S. dollars in aid for reconstruction, boosting the regional government’s kitty, which received nearly 1 billion dollars in oil revenues.
Southern Sudan has seen virtually no development since the 1950s, and more than 4 million southern Sudanese fled their homes during the war.
And the peace accord allows the southern Sudanese to hold a referendum on independence in six years, setting up the possibility of more conflict with the north, analysts say.
(Xinhua/ST)