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South Sudan: The Cost of War

This report was prepared by Frontier Economics in collaboration with the Center for Conflict Resolution (CECORE) and the Centre for Peace and Development Studies (CPDS).

An estimation of the economic and financial costs of ongoing conflict 

The conflict in South Sudan since December 2013 has devastated the lives of the majority of South Sudan’s people. It has killed tens of thousands, placed nearly a third of the population at risk of famine and ravaged key parts of the country. The conflict has been brutal: killings, rape, forced recruitment of children, mass displacement and the destruction of livelihoods. It has left open wounds that will take decades to heal.

South Sudan Cost of war
Civilians fleeing the fighting and seeking refuge, wait outside a compound of the UN Mission in Bor (December 2013). UN Photo/Hailemichael Gebrekrstos

The economic costs of the conflict to date are substantial, with a projected drop of 15% in South Sudan’s GDP for 2014.

This report looks forward from January 2015 to quantify the additional economic costs that would be incurred by South Sudan, other countries in the neighbouring region, and the wider international community, should the conflict continue.

By viewing the conflict through this economic lens, the findings of this report likely understate the cost of war in South Sudan. The full effects of conflict, such as environmental degradation, the break-down of social cohesion, and the psycho-social trauma generated by sexual violence and child exploitation, are difficult to capture in their entirety in an economic cost benefit analysis. South Sudan can ill-afford the economic costs of war, but after decades fighting for independence from its northern neighbour, it is even less equipped to bear the heavy social costs of another generation growing up in a violently divided society. The longer the violence continues, the further it spreads, and the more insidious it becomes, the more difficult the task will be for South Sudan to undergo the kind of social, psychological and economic transformation needed to achieve lasting peace.

Key findings

A central finding of this report is the need for early action. The costs of conflict to South Sudan, its neighbours and the international community are likely to increase at an accelerating rate the longer the conflict persists.

Key findings for South Sudan:

  • If the conflict continues for another 1 to 5 years, it will cost South Sudan between US$22.3 billion and $28 billion. If the conflict’s effects are measured over 20 years to allow for flow-on effects, the loss is even greater: between $122 billion and $158 billion.
  • The human costs of conflict – death, hunger and disease – also have significant longer term economic impacts. Just taking the effects of hunger on labour productivity could mean a further $6 billion in lost GDP if the conflict were to last another 5 years.
  • South Sudan’s spending on security could increase by a further $2.2 billion were the conflict to last another 5 years. The savings in military spending that would result from resolving the conflict within a year from now would allow South Sudan to meet the internationally recommended target of allocating 20% of spending to education.

Key findings for the region:

  • The five countries considered in this report – Ethiopia, Kenya, Sudan, Tanzania, and Uganda – could between them save up to $53 billion if the conflict were resolved within 1 year, rather than allowed to last for 5 years.
  • Countries in the region, most notably Uganda and Kenya, may incur substantial financial costs relating to security needs. Figures reported for Uganda suggest that defence expenditure incurred as a result of the conflict is around double the government’s projected capital investment budget for the health sector for the coming financial year, and close to the capital investment budget for education.

Key finding for the international community:

  • If the conflict ended within one year rather than 5, the international community could save nearly an estimated US$ 30 billion by reducing expenditure on peacekeeping and humanitarian assistance.

Read the full report- South Sudan: The Cost of War

Source: Frontier Economics.


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