East Africa: South Sudan Conflict Could Cost Its Neighbours Billions

South Sudan is at risk of becoming a "failed state, consumed by civil war" if fighting does not end swiftly, a report released this week warned.

"Worse still, it could become the epicentre of a full blown regional conflict," according to the report, prepared by London-based economic consulting firm Frontier Economics in collaboration with the Centre for Peace and Development Studies at the University of Juba and the Centre for Conflict Resolution, a Ugandan non-profit.

The report, released Wednesday (January 14th), urged African leaders to consider using the upcoming African Union Summit to address the issue, and detailed the potential cost to South Sudan and its neighbours should the conflict continue.

"No monetary figure or economic projection can quantify the full human cost of this conflict," Tanzania's Prime Minister Salim Ahmed Salim said in the report's forward. "There can be no price tag on the suffering of South Sudan's people from displacement, famine and death. But it is possible to assess the direct economic costs by estimating the loss of productive assets and capital, the reduction in economic activity, and the domestic diversion from productive to non-productive activities."

"The costs are equally severe for neighbouring countries and the international community at large -- including, in this case, the likely decline in formal trade flows with South Sudan's neighbours, and the cost of providing humanitarian aid and UN peacekeepers for years to come," he said.

If the conflict continues, it will cost South Sudan between $22.3 billion and $28 billion over the next five years, the report said, adding that "if the conflict's effects are measured over 20 years to allow for flow-on effects, the loss is even greater: between $122 billion and $158 billion".

Ethiopia, Kenya, Sudan, Tanzania and Uganda could save a total of $53 billion if the conflict is stopped within one year, the report said. The international community also could save $30 billion by reducing expenditure on peacekeeping and humanitarian assistance in South Sudan.

"The parties to the conflict should commit to an unconditional, complete and immediate end to all hostilities, and to the immediate cessation of the recruitment and mobilisation of civilians," the report recommended.

"If the parties to the conflict continue to violate the cessation of hostilities agreement and escalate the fighting, the IGAD [Intergovernmental Authority on Development] region should take the necessary measures to directly intervene in South Sudan to protect civilians and restore peace and stability," it said.