Pipeline Losses Add Pressure to Oil Economy

(JUBA) – South Sudan’s political uncertainty continues to shape its economic prospects, as senior leaders maintain control through delayed elections, patronage and regional conflict positioning. Analysts have warned that persistent instability is weakening investor confidence, slowing infrastructure spending and limiting access to international financing.

The continued postponement of national elections, now pushed to 2026, has left the country without a clear roadmap for political transition. While authorities state that calm must be secured before voting takes place, business observers argue that the uncertainty has discouraged long term planning across key sectors such as oil, agriculture and telecommunications.

According to research conducted by Professor Steven C. Roach of the University of South Florida, South Sudan’s political leadership has relied on four recurring methods to retain authority: resisting elections, restricting civil society participation, amplifying fears of rebellion, and using regional crises as diplomatic leverage. These tactics have preserved control but at the cost of economic progress.

Civil society groups that would normally support transparency and reform have been sidelined. Meanwhile, continued power struggles between President Salva Kiir and First Vice President Riek Machar have discouraged efforts to establish reliable governance structures.

The country’s reliance on oil exports has also been tested by external shocks. A recent pipeline disruption in Sudan cut nearly 40 percent of oil revenue. With crude sales representing close to all foreign income, South Sudan’s ability to cover public salaries, including security forces, is now under pressure.

Estimated Impact of Pipeline Disruption

Leadership succession is also emerging as a new uncertainty. President Kiir has been reported to be in poor health and has recently positioned former advisor Benjamin Bol Mel as his preferred successor. In May 2025, he dismissed Vice Presidents Kuol Manyang Juuk and Daniel Awet Akot, both considered internal critics, and later appointed his daughter Adut Salva Kiir to a senior diplomatic role. These moves have raised questions among business observers over future policy direction.

Foreign aid, once a stabilising factor, has declined sharply. The United States Agency for International Development reportedly provided nearly 113.6 billion South Sudan Pounds (16 million US dollars) to civil society programmes in 2023. With the agency now scaled back, continued support for governance reforms is uncertain.

Regional instability continues to spill into South Sudan, particularly from neighbouring Sudan. As populations cross borders and trade routes decline in safety, cross border commerce, a key revenue source for traders in Renk, Bentiu and the Juba-Yei corridor has slowed.

Economists say that South Sudan’s business climate could improve if there is greater clarity on the election timetable, security reform and constitutional progress. Closer cooperation with regional trade blocs could also unlock alternative transport corridors for oil and agricultural exports.

However, with political calculations still prioritised above economic planning, investors remain cautious. As one Juba based analyst noted, “Instability may serve the interests of those in charge, but it has become the single greatest tax on South Sudan’s growth.”

Political Strategies and Economic Impact in South Sudan