South Sudan Hopes The Planned Port in Djibouti Will Increase Market Access, Profits
South Sudan officials confirmed that this month, they had bought land on Djibouti’s coast to build a port. South Sudan says the country’s crude oil, which goes through Sudan currently, will be exported through the port. And also for importing goods, most of which come from the Kenyan Port.
Last week, South Sudan’s Minister of petroleum, Puot Kang Chol, said that the land was purchased for crude oil exportation.
He said, “I would like to announce to all of you that we have been pushing to make sure we open all our ways because, as we all know, South Sudan is a landlocked country and therefore, there is a need for us to try our level best to have access to the market.”
Two other African Great Lakes countries, the Democratic Republic of the Congo and Uganda, said they would move their port operations to Tanzania. This will leave just Burundi and Rwanda fully dependent on the Mombasa port.
A Nairobi-based economist, Duncan Otieno, said the move puts Kenya in a difficult situation as it feels there is competition from the Dar es Salaam regional port and now Djibouti.
He said, “There is every reason to believe that the exit of South Sudan will affect the port of Mombasa in the essence that, with Uganda existing and considering the port of Dar es Salaam, that is likely to affect the operations in the port of Mombasa.” “We need to ask ourselves what could have led to DRC and Uganda and now South Sudan considering giving the port of Mombasa a wide berth.”
Abraham Mamer, a South Sudanese economist, said the Djibouti port would provide a less expensive route for South Sudanese imports and exports.
He says, “In terms of economies of scale, we are better off than building another railway to connect us to Sudan. We are saving to directly import or export our oil from the eastern part of South Sudan through Djibouti, Ethiopia. So, for us, we are not losing, we are gaining. South Sudan is not land-locked, it is land-linked, so it is OK.”
Oil deposits in South Sudan are estimated at 3.5 billion barrels. This means that if the country finds a way to end its state of conflict and increase its oil production, the impact on the economy would be enormous, not determining the port used by the country for its exports.