Billions At Stake As South Sudan Crisis Affects Trade

Ugandan businesses and businessmen in South Sudan have to count their losses as a result of the crisis ongoing in that country.
According to the Uganda Traders Association of South Sudan most of the Ugandan businesses in the now volatile country are informal, making it hard to quantify the value of goods and services that they offer.

What is clear though, according to some of the traders who have returned, there are losses both monetary and in terms of property.

In 2012 alone, exports to Sudan were estimated Shillings one trillion, out of which three quarters are to South Sudan. This figure is up from Shillings 981billion in 2011.

Most exports to South Sudan include re-exported cosmetics, vegetables, eggs and construction material like cement and iron sheets among others.

Roofings Uganda, the largest steel products manufacturer in Uganda, is one of the formal businesses that export material to South Sudan.

At their export department in Lubowa, the top managers were unavailable for a comment but  Red Pepper Online talked to some of the staff who revealed that demand from South Sudanese customers had declined drastically in the last one and a half weeks.

However, they also point out that demand from South Sudan has been slow in 2013, if compared to 2012. For instance in the third quarter of 2013, Uganda exported goods valued at Shillings 107 billion down from Shillings 242.7 billion in the same period in 2012. Already, monthly statistics to October 2013 are much lower than those seen in 2012.

In the financial year 2012/13 National Budget, the South Sudanese government released what they termed as an austere budget where capital spending shrunk to 7percent due to reduced oil revenues as a result of shutdown in production.

This according to Bank of Uganda meant that Uganda was experiencing a shortage of South Sudanese dollar in-flows. One place that would feel the impact of low dollar inflows is Dahabshiil

At Dahabshiil, a popularly used money remittance service by South Sudanese both in Uganda and back home, the queues have reduced.

At both branches – one along Bombo Road in Kampala and another on Kampala road – it has been business unusual due to the crisis in South Sudan.

The Dahabshiil staff we talked too however also revealed that inflows of the South Sudan Dollar had also slowed for most of 2013.

In the aviation sector, Air Uganda continues to fly to South Sudan after briefly suspending flights at the start of the current conflict over two weeks ago.

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