A blessing or a curse?

As south Sudan approaches probable independence, Sudan’s ruling National Congress Party (NCP) and the Sudan People’s Liberation Movement (SPLM) have started discussions to resolve disputes over borders, leadership – and finances. 

Sudan’s biggest asset is oil, representing about 90 per cent of the nation’s export earnings. Around 400,000 barrels are shipped every day, mostly to Asia’s increasingly energy-hungry nations – China and India.

Since the 2005 peace agreement, that wealth has been split equally with each territory taking 50 per cent of the revenue. For the north, it makes up 65 per cent of its budget, but the south is almost entirely dependent on the oil money – it accounts for an estimated 98 per cent of its earnings.
 
Despite its oil revenue, Sudan is $38bn in debt – a burden the north has reportedly promised to take on in its entirety should the south secede.

But the south still faces many obstacles. Lacking in the most basic infrastructure, it must become equipped to exploit its most precious commodity.

And while the south is almost entirely reliant on oil, the north is diversifying its export economy with a range of other commodities.

Sudan is Africa’s fourth-largest sugar producer, pumping out about 800,000 metric tonnes annually. A byproduct of that is ethanol and Khartoum plans to become a major world player in that industry.

There is also cotton, 90 per cent of which is exported in raw form, and livestock, which is mostly exported to Saudi Arabia, Kuwait, the UAE and Qatar. And then there is gum arabic – the miracle commodity used in medicines and soft drinks – of which Sudan is the world’s largest producer.
 
On this episode of Crossroads Sudan we discuss Khartoum’s plans to diversify the economy. We also take a look at the unethical oil practices behind the oil industry and ask: How much of a curse is Sudan’s oil?

This episode of Crossroads Sudan can be seen from Monday, January 24, at 1730GMT, with repeats on Tuesday at 0030GMT, 0530GMT and 1130GMT.