Kenya and South Sudan resolve border disputes, agree boost trade and infrastructure

Issues around border conflicts and port access have threatened trade ties between both countries for decades.

Kenya and South Sudan resolve border disputes, agree boost trade and infrastructure
Image source: Official website of the President of Kenya.
Editor’s note: This story is part of Mariblock’s “State of Fiat” coverage. Digital assets such as bitcoin are seen as competitors to central bank money. Therefore, we consider informing our audience of the state of their local currencies worthwhile.

After prolonged border and port disputes between Kenya and South Sudan, the leaders of these nations have decided to enhance trade ties by developing infrastructure projects to connect both countries. This commitment aims to strengthen their ties and promote economic cooperation.

Key details 

  • Kenya’s president, William Ruto, speaking after a meeting with his Sudanese counterpart, Salva Kiir, in Nairobi, said the completion of these projects is pivotal to bilateral trade between them.
  • Top on the list of projects is the Lamu Port-South Sudan-Ethiopia-Transport Corridor project (LAPSSET), which is a road network linking the port of Lamu to South Sudan and Ethiopia.
  • Alongside the agreement, there are plans to install a fiber optic cable spanning both countries and to finalize the construction of the 11km Nadapal to Nakodok road, which serves as a crucial link between northern Kenya and South Sudan.
  • Both presidents also discussed taking advantage of the African Continental Free Trade Area (AfCTFA) agreement to increase commercial activities between each other.

What was said

  • Kenya’s President Williams Ruto said:
“President Kiir and I had the opportunity to share ideas about collaborating to seize emerging opportunities to improve the trade balance between our two nations.”

Why this matters

  • Kenya shares a 317km border to its north with South Sudan and has had bilateral trade with it for years.
  • In 2021, Kenya was South Sudan’s second-largest importer of goods and its largest importer of edible preparations such as supplements and concentrates, data from the Observatory of Economic Complexity shows.
  • Put differently, $26.1 million of South Sudan’s $39.3 million edible preparations import came from Kenya.
  • In addition, South Sudan is landlocked, and two of its significant points of access to intercontinental trade are in Kenya: the Lamu Port and the Mombasa Port. Nearly all cargo imported into South Sudan is offloaded in Kenyan ports and transported by road to South Sudan.

Dispute background

  • Decades-old border disputes between both nations routinely threaten the bilateral ties between the two countries. The oil-rich Ilemi triangle has been a point of contention and remains unresolved.
  • Earlier this year, South Sudanese authorities accused Kenya of encroaching into its territory on a critical trade route between countries, threatening relations between them.
  • In addition, South Sudan has been looking to divert its cargo away from Kenyan ports in a move that would see Kenya lose some revenue. In mid-2022, the country acquired seaside land in Djibouti to construct a port.
  • Among the reasons cited by the South Sudanese government was that the Kenyan ports were too far and that it sought to strengthen ties with Djibouti.
  • However, last December, following a meeting between both presidents, Ruto offered two more ports to South Sudanese traders without any restrictions and promised to provide land to construct a port.
  • According to him, Kenya is keen to make it easier and faster for goods to get to South Sudan and to strengthen trade ties with the country.
  • It remains to be seen how much the completion of the proposed projects will impact trade relations between both countries.

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