Frenemies: Economic woes force border reopening for first time since South Sudan left Sudan in 2011

President Omar al-Bashir sealed crossings the same year the South declared independence, but declining revenues are again bringing them close.

SUDAN and South Sudan will open their border for the first time since the latter seceded in 2011, allowing a flow of cheaper goods amid an economic crisis caused by civil war in the world’s newest nation, government officials said.

The move would allow for “better and cheaper provisions of goods and services” and “promote the relationship between us and Sudan,” South Sudanese presidential spokesman Ateny Wek Ateny said Thursday by phone from Juba, the capital.

Read: What a strike by bank workers demanding a 500% pay rise tells us about the state of South Sudan

Sudan’s state-run news agency, SUNA, reported late Wednesday that President Omar al-Bashir had ordered the reopening of the border. His government sealed crossings the same year South Sudan declared independence, accusing Juba of supporting rebels on Sudanese territory.

Traders continued to operate on “a lesser scale” until the civil war began in December 2013 and all movement stopped, Foreign Affairs Ministry spokesman Mawien Makol Arik said by phone.

Last week Sudan agreed to renegotiate fees it charges South Sudan on oil passing through its territory after crude prices declined. 

Talks are on to discuss the technicalities following an order by Bashir.

South Sudan, took with it sub-Saharan Africa’s third-largest oil reserves when the two countries separated. The government in Khartoum exports its landlocked neighbour’s crude through pipelines to a port on the Red Sea and collects $25 per barrel in transit fees.

Prices crashed

But oil has since crashed to prices under $35 a barrel, from the over $100 they were trading at when the deal was negotiated. The World Bank is forecasting prices will not breach $40 this year.

Due to conflict South Sudan is pumping a third less of the oil it produced in December 2013.

South Sudan descended into civil war that month when fighting erupted between forces loyal to Kiir and his then deputy Riek Machar, splitting the country along ethnic lines.

Hundreds of thousands of South Sudanese have fled to neighbouring countries during the conflict, including to Sudan.

Prices have been spiralling out of control in South Sudan after the conflict and plunging prices for oil, one of the government’s few sources of income, forced it to abandon its currency peg. Surging food costs and a foreign-exchange shortage boosted consumer prices by 109.9% in December.

Neighbour Sudan this week lifted subsidies on fuel oil, jet fuel and cooking gas, opening the market to private investors as it sought to take advantage of falling energy prices. 

(Bloomberg, AFP)

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