Public Private Cooperation Fragile States Field study report South Sudan As part of the Country Study South Sudan Working group: Public Private Cooperation in Fragile States July 2009 Public Private Cooperation opportunities in Southern Sudan Report of the field research mission July 2009 Irma Specht & Mark van Dorp (main researchers) and Washington Okeyo Marjolein C. Groot John Penn de Ngong Overall coordination /Editor Bert Bosch (TFM Consult) 2 Table of Contents EXECUTIVE SUMMARY.................................................................................................................................................. 4 INTRODUCTION ...............................................................................................................................................................12 1. THE POTENTIAL ROLE OF PUBLIC PRIVATE COOPERATION ......................................................19 1.1 EXISTING EXPERIENCES WITH PPC IN SOUTHERN SUDAN.....................................................................................19 1.2 OPINIONS AND PERSPECT IVES ON PPC .....................................................................................................................22 1.3 CHALLENGES FOR PPC ................................................................................................................................................24 1.4 POTENTIAL MODALITIES FOR PPC ............................................................................................................................25 1.5 ENABLING ENVIRONMENT..........................................................................................................................................33 2. HOW CAN PPC CONTRIBUTE TO CONFLICT TRANSFORMATION? ................................................35 2.1 KEY CONCERNS FOR ECONOMIC DEVELOPMENT .....................................................................................................35 2.1.1 Ensure collaboration with local private sector............................................................................................36 2.1.2 Strengthening capacity of Government and civil society...........................................................................36 2.2 ENSURING CONFLICT SENSITIVITY............................................................................................................................37 2.2.1 Transformation of war economy.....................................................................................................................38 2.2.2 Include Corporate Social Responsibility in investments............................................................................40 2.2.3 Gender concerns................................................................................................................................................41 2.2.4 Investing in economic support services.........................................................................................................43 2.2.4.1 Vocational training.........................................................................................................................................43 2.2.4.2 Business Development Services .....................................................................................................................44 2.2.4.3 Integrating environmental aspects..................................................................................................................45 3. POTENTIAL FOR FAIR AND SUSTAINABLE ECONOMIC DEVELOPMENT ...................................46 3.1 SPECIFIC SITUATION IN CENTRAL AND WESTERN EQUATORIA STATE...............................................................46 3.1.1 Ongoing economic activity..............................................................................................................................46 3.1.2 Potential sectors................................................................................................................................................58 3.1.3 Challenges in the abovementioned sectors...................................................................................................64 3.2 MAJOR STAKEHOLDERS..............................................................................................................................................66 3.2.1 Stakeholder analysis.........................................................................................................................................66 4. CONCLUSIONS .............................................................................................................................................................72 5. RECOMMENDATIONS FOR PPC..........................................................................................................................76 ANNEX A PEOPLE CONTACTED........................................................................................................................................78 ANNEX B METHODOLOGY................................................................................................................................................83 ANNEX C LEGAL FRAMEWORKS......................................................................................................................................89 ANNEX D LIST OF ABBREVIATIONS................................................................................................................................91 ANNEX E BIBLIOGRAPHY.................................................................................................................................................93 ANNEX F KEY STAKEHOLDERS AND SPECIFIC (SUB)SECTORS IN MORE DETAIL (SEPARATE)..................................95 ANNEXE G: MAP OF SUDAN.............................................................................................................................................96 Disclaimer The views expressed and analysis put forward in this report are entirely those of the authors in their professional capacity and cannot be attributed to ICCO and/ or the Peace, Security and Development Network or its working groups and/ or the Dutch Ministry of Foreign Affairs. 3 Executive summary The challenges facing Southern Sudan are daunting, but the potential for fair and sustainable economic development is equally significant. Unlike many post-conflict countries, Southern Sudan is richly endowed with natural resources. It starts with considerable wealth from oil, and a broad base of potential export or growth sectors including hydroelectric power, metallic and non-metallic mining, natural gum/resins, cotton, oil seeds, tourism, medicinal plants, fisheries, tobacco, coffee, tea, leather and horticulture. In order to move away from dependency on oil revenues, diversification in economic activit ies is , however, essential in order for development to be sustainable . Southern Sudan must unleash its potential if it is to fully realise the peace dividend. Objective of this research The main goal of this first-phase field research of the wider research into PPC opportunities for socio- economic development in fragile states was to identify the local needs and possibilities for this development through Public Private Cooperation (PPC) in Southern Sudan. This report therefore concentrates on the local dynamics of PPC between the GoSS, the local private sector and Non- Governmental Organisations (NGOs) in which any future PPC interventions should be embedded, if they are to be effective and sustainable. The outcome of this research feeds into the second phase research, which builds upon these results, and further assesses potential PPC modalities, including the potential involvement of Dutch companies and the Dutch Government. Therefore, this report was not intended to be a stand-alone and final product, as its main purpose was to inform the second phase research team on the realities on the ground in Southern Sudan. The specific objectives of this Public -Private Cooperation (PPC) field research were 1) to determine the potential for fair and sustainable economic development in Southern Sudan, with Central and Western Equatoria states as research areas, 2) to explore if PPC can play a role in this development and 3) to examine how PPC should be set up in order to contribute to conflict transformation and peace. This report and its main findings summarised below, contain the results of this research which was conducted in February and March 2009. Economic development in South Sudan There are numerous ongoing economic activities in Southern Sudan and there is enormous potential for (fair and sustainable) economic development in various sectors. However, economic development is challenged by the lack of capital, technology, poor infrastructure, lack of skilled labour and business know-how and in general a weak capacity of all private and public economic actors. Nevertheless, Southern Sudan provides many business opportunities, especially in the production of agricultural products and (semi-)manufactured goods , most of which are currently being imported from Uganda, Kenya and North Sudan. However, the development of these business opportunities should preferably be done in the framework of a PPC in order to safeguard fair and sustainable economic development, with the ultimate aim of contributing to durable peace. The following sectors have, among others, high potential for economic development in the short and medium term, and are potentially interesting to be developed