South Sudan is at a crossroads in its efforts toward recovery, reconstruction, and development. South Sudan gained independence in 2011, in what was expected to be a new dawn for the conflict-torn country. At the time, optimism was high, given high commodity prices, the country’s abundant natural resources, and international goodwill. However, weak institutions and recurring cycles of conflict have curtailed progress, and often reversed gains. Initial peace efforts proved futile, and the country relapsed into conflict in 2013 and again in 2016 as successive peace agreements collapsed. These conflicts precipitated a macroeconomic crisis and economic decline with widening fiscal deficits, high and persistent inflation, and spiraling foreign exchange rate spreads. Poverty is ubiquitous and has been reinforced by displacement and recurring climatic shocks. Consequently, a decade after gaining independence, South Sudan remains caught in a web of fragility and economic stagnation. While recent efforts to integrate the military command structure should be commended, the peace process has progressed slowly, and continued subnational conflicts continue to threaten a peaceful transition. Instability, a non-diversified economy, corruption, and poor delivery of services remain among the most important risks to the country’s long-term growth prospects. This Country Economic Memorandum (CEM) discusses South Sudan’s economic performance since independence, with a focus on leveraging the country’s natural capital to support recovery and resilience.

Download