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South Sudan vs. Kenya

Economy

South SudanKenya
Economy - overview

Industry and infrastructure in landlocked South Sudan are severely underdeveloped and poverty is widespread, following several decades of civil war with Sudan. Continued fighting within the new nation is disrupting what remains of the economy. The vast majority of the population is dependent on subsistence agriculture and humanitarian assistance. Property rights are insecure and price signals are weak, because markets are not well-organized.

South Sudan has little infrastructure - about 10,000 kilometers of roads, but just 2% of them paved. Electricity is produced mostly by costly diesel generators, and indoor plumbing and potable water are scarce, so less than 2% of the population has access to electricity. About 90% of consumed goods, capital, and services are imported from neighboring countries - mainly Uganda, Kenya and Sudan. Chinese investment plays a growing role in the infrastructure and energy sectors.

Nevertheless, South Sudan does have abundant natural resources. South Sudan holds one of the richest agricultural areas in Africa, with fertile soils and abundant water supplies. Currently the region supports 10-20 million head of cattle. At independence in 2011, South Sudan produced nearly three-fourths of former Sudan's total oil output of nearly a half million barrels per day. The Government of South Sudan relies on oil for the vast majority of its budget revenues, although oil production has fallen sharply since independence. South Sudan is one of the most oil-dependent countries in the world, with 98% of the government's annual operating budget and 80% of its gross domestic product (GDP) derived from oil. Oil is exported through a pipeline that runs to refineries and shipping facilities at Port Sudan on the Red Sea. The economy of South Sudan will remain linked to Sudan for some time, given the existing oil infrastructure. The outbreak of conflict in December 2013, combined with falling crude oil production and prices, meant that GDP fell significantly between 2014 and 2017. Since the second half of 2017 oil production has risen, and is currently about 130,000 barrels per day.

Poverty and food insecurity has risen due to displacement of people caused by the conflict. With famine spreading, 66% of the population in South Sudan is living on less than about $2 a day, up from 50.6% in 2009, according to the World Bank. About 80% of the population lives in rural areas, with agriculture, forestry and fishing providing the livelihood for a majority of the households. Much of rural sector activity is focused on low-input, low-output subsistence agriculture.

South Sudan is burdened by considerable debt because of increased military spending and high levels of government corruption. Economic mismanagement is prevalent. Civil servants, including police and the military, are not paid on time, creating incentives to engage in looting and banditry. South Sudan has received more than $11 billion in foreign aid since 2005, largely from the US, the UK, and the EU. Inflation peaked at over 800% per year in October 2016 but dropped to 118% in 2017. The government has funded its expenditures by borrowing from the central bank and foreign sources, using forward sales of oil as collateral. The central bank's decision to adopt a managed floating exchange rate regime in December 2015 triggered a 97% depreciation of the currency and spawned a growing black market.

Long-term challenges include rooting out public sector corruption, improving agricultural productivity, alleviating poverty and unemployment, improving fiscal transparency - particularly in regard to oil revenues, taming inflation, improving government revenues, and creating a rules-based business environment.

Kenya is the economic, financial, and transport hub of East Africa. Kenya's real GDP growth has averaged over 5% for the last decade. Since 2014, Kenya has been ranked as a lower middle income country because its per capita GDP crossed a World Bank threshold. While Kenya has a growing entrepreneurial middle class and steady growth, its economic development has been impaired by weak governance and corruption. Although reliable numbers are hard to find, unemployment and under-employment are extremely high, and could be near 40% of the population. In 2013, the country adopted a devolved system of government with the creation of 47 counties, and is in the process of devolving state revenues and responsibilities to the counties.

Agriculture remains the backbone of the Kenyan economy, contributing one-third of GDP. About 75% of Kenya's population of roughly 48.5 million work at least part-time in the agricultural sector, including livestock and pastoral activities. Over 75% of agricultural output is from small-scale, rain-fed farming or livestock production. Tourism also holds a significant place in Kenya's economy. In spite of political turmoil throughout the second half of 2017, tourism was up 20%, showcasing the strength of this sector. Kenya has long been a target of terrorist activity and has struggled with instability along its northeastern borders. Some high visibility terrorist attacks during 2013-2015 (e.g., at Nairobi's Westgate Mall and Garissa University) affected the tourism industry severely, but the sector rebounded strongly in 2016-2017 and appears poised to continue growing.

Inadequate infrastructure continues to hamper Kenya's efforts to improve its annual growth so that it can meaningfully address poverty and unemployment. The KENYATTA administration has been successful in courting external investment for infrastructure development. International financial institutions and donors remain important to Kenya's growth and development, but Kenya has also successfully raised capital in the global bond market issuing its first sovereign bond offering in mid-2014, with a second occurring in February 2018. The first phase of a Chinese-financed and constructed standard gauge railway connecting Mombasa and Nairobi opened in May 2017.

In 2016 the government was forced to take over three small and undercapitalized banks when underlying weaknesses were exposed. The government also enacted legislation that limits interest rates banks can charge on loans and set a rate that banks must pay their depositors. This measure led to a sharp shrinkage of credit in the economy. A prolonged election cycle in 2017 hurt the economy, drained government resources, and slowed GDP growth. Drought-like conditions in parts of the country pushed 2017 inflation above 8%, but the rate had fallen to 4.5% in February 2018.

The economy, however, is well placed to resume its decade-long 5%-6% growth rate. While fiscal deficits continue to pose risks in the medium term, other economic indicators, including foreign exchange reserves, interest rates, current account deficits, remittances and FDI are positive. The credit and drought-related impediments were temporary. Now In his second term, President KENYATTA has pledged to make economic growth and development a centerpiece of his second administration, focusing on his "Big Four" initiatives of universal healthcare, food security, affordable housing, and expansion of manufacturing.

GDP (purchasing power parity)$20.01 billion (2017 est.)

$21.1 billion (2016 est.)

$24.52 billion (2015 est.)

note: data are in 2017 dollars
$227.638 billion (2019 est.)

$216.046 billion (2018 est.)

$203.206 billion (2017 est.)

note: data are in 2010 dollars
GDP - real growth rate-5.2% (2017 est.)

-13.9% (2016 est.)

-0.2% (2015 est.)
5.39% (2019 est.)

6.32% (2018 est.)

4.79% (2017 est.)
GDP - per capita (PPP)$1,600 (2017 est.)

$1,700 (2016 est.)

$2,100 (2015 est.)

note: data are in 2017 dollars
$4,330 (2019 est.)

$4,204 (2018 est.)

$4,046 (2017 est.)

note: data are in 2010 dollars
Population below poverty line76.4% (2016 est.)36.1% (2015 est.)
Inflation rate (consumer prices)187.9% (2017 est.)

379.8% (2016 est.)
5.1% (2019 est.)

4.6% (2018 est.)

8% (2017 est.)
Distribution of family income - Gini index46 (2010 est.)40.8 (2015 est.)

42.5 (2008 est.)
Budgetrevenues: 259.6 million (FY2017/18 est.)

expenditures: 298.6 million (FY2017/18 est.)
revenues: 13.95 billion (2017 est.)

expenditures: 19.24 billion (2017 est.)
Agriculture - productsmilk, sorghum, vegetables, cassava, goat milk, fruit, beef, sesame seed, sheep milk, muttonsugar cane, milk, maize, potatoes, bananas, camel milk, cassava, sweet potatoes, mangoes/guavas, cabbages
Exports$1.13 billion (2016 est.)$10.078 billion (2019 est.)

$10.1 billion (2018 est.)

$9.723 billion (2017 est.)
Exports - commoditiescrude petroleum, gold, forage crops, lumber, insect resins (2019)tea, cut flowers, refined petroleum, coffee, titanium (2019)
Exports - partnersChina 88%, United Arab Emirates 5% (2019)Uganda 10%, United States 9%, Netherlands 8%, Pakistan 7%, United Kingdom 6%, United Arab Emirates 6%, Tanzania 5% (2019)
Imports$3.795 billion (2016 est.)$18.729 billion (2019 est.)

$19.116 billion (2018 est.)

$18.653 billion (2017 est.)
Imports - commoditiescars, delivery trucks, packaged medicines, foodstuffs, clothing and apparel (2019)refined petroleum, cars, packaged medicines, wheat, iron products (2019)
Imports - partnersUnited Arab Emirates 37%, Kenya 18%, China 18% (2019)China 24%, United Arab Emirates 10%, India 10%, Saudi Arabia 7%, Japan 5% (2019)
Exchange ratesSouth Sudanese pounds (SSP) per US dollar -

0.885 (2017 est.)

0.903 (2016 est.)

0.9214 (2015 est.)

0.885 (2014 est.)

0.7634 (2013 est.)
Kenyan shillings (KES) per US dollar -

111.45 (2020 est.)

101.4 (2019 est.)

102.4 (2018 est.)

98.179 (2014 est.)

87.921 (2013 est.)
Public debt62.7% of GDP (2017 est.)

86.6% of GDP (2016 est.)
54.2% of GDP (2017 est.)

53.2% of GDP (2016 est.)
Reserves of foreign exchange and gold$73 million (31 December 2016 est.)$7.354 billion (31 December 2017 est.)

$7.256 billion (31 December 2016 est.)
Current Account Balance-$154 million (2017 est.)

$39 million (2016 est.)
-$57.594 billion (2019 est.)

-$56.194 billion (2018 est.)
GDP (official exchange rate)$3.06 billion (2017 est.)$95.52 billion (2019 est.)
Ease of Doing Business Index scoresOverall score: 34.6 (2020)

Starting a Business score: 71 (2020)

Trading score: 26.2 (2020)

Enforcement score: 59 (2020)
Overall score: 73.2 (2020)

Starting a Business score: 82.7 (2020)

Trading score: 67.4 (2020)

Enforcement score: 58.3 (2020)
Taxes and other revenues8.5% (of GDP) (FY2017/18 est.)17.6% (of GDP) (2017 est.)
Budget surplus (+) or deficit (-)-1.3% (of GDP) (FY2017/18 est.)-6.7% (of GDP) (2017 est.)
Unemployment, youth ages 15-24total: 38.6%

male: 39.5%

female: 37.4% (2017 est.)
total: 7.4%

male: 7.3%

female: 7.4% (2016)
GDP - composition, by end usehousehold consumption: 34.9% (2011 est.)

government consumption: 17.1% (2011 est.)

investment in fixed capital: 10.4% (2011 est.)

exports of goods and services: 64.9% (2011 est.)

imports of goods and services: -27.2% (2011 est.)
household consumption: 79.5% (2017 est.)

government consumption: 14.3% (2017 est.)

investment in fixed capital: 18.9% (2017 est.)

investment in inventories: -1% (2017 est.)

exports of goods and services: 13.9% (2017 est.)

imports of goods and services: -25.5% (2017 est.)
Gross national saving3.6% of GDP (2017 est.)

18.7% of GDP (2016 est.)

7.4% of GDP (2015 est.)
8% of GDP (2019 est.)

8.6% of GDP (2018 est.)

9.2% of GDP (2017 est.)

Source: CIA Factbook