Our comprehensive assessment of South Sudan's operating environment and the outlook for its leading sectors are formed by bringing together a wealth of data on global markets that affect South Sudan, as well as the latest industry developments that could impact South Sudan's industries. This unique integrated approach has given us an impeccable track-record for predicting important shifts in the markets, ensuring you’re aware of the latest market opportunities and risks in South Sudan before your competitors.
South Sudan Country Risk
April's election and a recent cabinet reshuffle have strengthened the Sudanese ruling regime and the position of President Bashir in particular. In light of this we see little chance of meaningful concessions being made on key issues such as political reform or the ongoing conflict in Darfur and other trouble spots.
A sharper than expected fall in inflation has prompted us to revise up our 2015 real GDP growth estimate for Sudan to 3.8% from 3.5% last quarter. Looking ahead, our outlook is unchanged and we expect growth to average 4.1% annually between 2016 and 2019 compared to the Sub-Saharan African (SSA) average of 4.8%.
In South Sudan, there growing evidence that the protracted nature of the civil conflict - which began in December 2013 - is leading to a hollowing out of state capacity and civil society and a...
South Sudan Industry Coverage (7)
South Sudan Autos
BMI View: We forecast growth of 8.4% in new passenger vehicle sales in 2016 as they recover from low base effects. Consistently low oil prices will result in lower fuel costs, which will support new vehicle sales.
|Vehicle Sales, Units|
|f = BMI forecast. Source: Renault, BMI|
|* New vehicle...|
Defence & Security
South Sudan Defence & Security
BMI View: Sudan boasts one of the region's largest defence sectors but still imports a significant volume of military equipment and services from Russia, China and Iran. Over the longer term, as the country's defence sector improves and it becomes more self sufficient, we expect there to be an increasing volume of defence exports, largely to the wider African region. A key driver behind the expansion of its military capabilities will remain the deteriorating situation in South Sudan and the ongoing violence between warring factions, opposition groups and government authorities. However, even though the country is looking for new export partners, we...
Food & Drink
South Sudan Food & Drink
BMI View: We maintain our view that economic growth in Sudan will pick up modestly over the coming quarters, with real GDP set to expand by 3.5% in 2015 and 4.3% in 2016 (from an estimated 2.6% in 2014). This improvement is in large part due to easing inflationary pressures as the high base effects associated with a painful currency devaluation in September 2013 wear-off. Our forecast for a significant rise in per capita food consumption in 2015 is a result of very low current consumption and high inflation. However, the demographic profile of the countries, with their significant young population, will provide opportunities.
Economic activity In Sudan will be supported by strong agricultural production and continued robust growth in...
South Sudan Infrastructure
BMI View: Sudan and South Sudan face a multitude of issues, with ongoing conflict having drastically eroded what little investor confidence there was in the markets and as such we forecast volatile and poor growth for both countries over our ten-year forecast period to 2024. Lower oil prices, in particular, will limit the ability of governments to implement their spending plans in the infrastructure sector - focusing on current spending instead - and with little investor interest left, there will be few infrastructure growth drivers.
While current events in Sudan and South Sudan overshadow their relationship with each other, oil trade between the two remains the key to any kind of sustainable growth with the respective construction industries. Political risks in Sudan and growing fears of a loss of control outside of Khartoum have damaged the reputation of the already internationally isolated government and this could...
Oil & Gas
South Sudan Oil & Gas
BMI View: Pervasive insecurity continues to hamper production in both Sudan and South Sudan. Falling oil prices coupled with frequent supply outages and repeated damage to infrastructure is undermining the appetite for investment in both markets. Chronic underinvestment will undercut sustainable production capacity and this, alongside limited exploration activity and a weak projects pipeline, will push crude oil production into decline in the back end of our 10-year forecast period.
Pharmaceuticals & Healthcare
South Sudan Pharmaceuticals & Healthcare
BMI View: Sudan is attempting to reduce its reliance on imported pharmaceuticals with government support. Despite an investment from an Egyptian drugmaker this quarter, the country will not achieve this goal in the near future given the current political environment.
Headline Expenditure Projections
Pharmaceuticals: SDG2.68bn (USD451mn) in 2014 to SDG3.00bn (USD491mn) in 2015; +12.1% in local currency terms and +8.7% in US dollar terms. Forecast revised slightly upwards from Q415.
Healthcare: SDG24.03bn (USD4.05bn) in 2014 to SDG27.05bn (USD4.42bn) in 2015; +12.6% in local currency terms and +9.1% in US dollar terms. ...
South Sudan Power
BMI View: The hostile economic and political environment in both Sudan and South Sudan continues to deter many potential investors, hampering the vital development of power infrastructure in both countries. There is, however, considerable long term growth potential both in terms of the large oil resources of South Sudan and the latent potential of non-hydropower renewables, particularly solar and wind power, which could be developed throughout the region.
Power infrastructure is woefully underdeveloped in Sudan and South Sudan, with extremely limited access to the transmission grid, which also suffers from high loss and theft rates. In many areas electricity supplies are dependent on stand-alone oil fired generators which are vulnerable to the frequent supply interruptions. Dependency on hydropower in Sudan also leaves the country vulnerable to supply interruptions due to the frequency of low...