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Did you know South Sudan’s major exports apart from Oil? Find out from this interview with Stephen Doctor Matatia, DG for Planning Ministry of Trade, Industry and East African Affairs.

Stephen Doctor Matatia, DG for Planning in his office (Photo: David Mono Danga)

 

Interview by David Mono Danga

Did you know South Sudan’s major exports apart from Oil? In order to get answers to this question, Juba Monitor’s reporter David Mono Danga had an exclusive interview with the ministry of Trade to understand the country’s strength and potential as peace looms.

JM: Tell me about yourself and your role at the Ministry.

Mr. Doctor: Thank you very much David for coming to look for these useful information which is a concern of everybody. You are playing a greater role contributing to the growth of our Gross Domestic product GDP.

My name is Stephen Doctor Matatia, I am the Director General for Planning,Research and Statistics in the Ministry of Trade, Industry and East African Community Affairs.

I graduated from Egypt in 1981. I started working in the Ministry of Trade on 1st September 1981 in Juba here and I became a senior inspector. I went to Khartoum, Sudan and worked with the coordinating council for 2 years. In 1991 I went to the Ministry of Foreign Trade in Sudan.  I worked in different sectors and departments while there.

I also worked with COMESA (Common Market for Eastern and Southern Africa) from 2007 – 2010 as the Secretary General in the Republic of the then Sudan until I came back to Juba later in 2010 and worked with this ministry as Director General of External Trade and recently I was transferred to be the Director General of Planning.

JM: In your experience as the Director General of External Trade what are the goods that South Sudan has been exporting?

Mr. Doctor: you know, the department of foreign trade is a sensitive one and very important because trade must exist between our country and other countries. It can be friendly countries, neighboring or any country in the world. You choose a country to trade with on comparative advantages. Meaning there are products that we don’t produce but we need to consume, then we import from countries producing them.

There are two kinds of trade products and services. There must be an agreement to exchange goods and services, like legalservices, accounting and medical services that you can’t produce here. But if we have those services then we don’t need to import.

For instance, if we have a gynecologist, we do not need to bring such a Doctor but if we don’t have an orthopedistthen we can bring them from other countries. This is to fill the gap. This is the philosophy and the reason why it is called comparative trade.

An orthopedist is a doctor who specializes in bone and joint disorders and treats fractures and recommends surgical interventions such as rodding surgery.

A gynecologist is a doctor who specializes in women’s reproductive health. Obstetricians care for women during their pregnancy and just after the baby is born. They also deliver babies. An ob-gyn is trained to do all of these things.

Those products and servicesthat we don’t produce or have will be supplemented by importing from other countries. They will also import from us what they don’t have. For example if they have no oil we will export it to them.

Wehave not yet settled down to register all the products that we should export. Our foreign trade is not yet complete due to some reasons. So I want to tell you that our trade is only one sided because we only import and consume.

All our money, all our dollars go to foreign countries to purchase goods and services that we do not have. Practically there is no balance of trade. If the trade has two sides, import and export, there will be a balance of trade and we will know whether imports are more than exports.

Intrade equation, if exports are more than imports that is very credible. You go ahead with that trade because it is profitable since the country gains. This happens when the country is table and production is taking place in all sectors. Agriculture is booming and Agricultural products are being produced, and manufacturing is also good.

It enables us to produce competitive goods to cross to foreign markets. If we have more exports more dollars will come in and we shall use the money for all our benefits. Buy food, pay salaries, expand our factories and manufacturing machineriesetc. But if our imports become more than our exports this is a problem. We are disadvantaged here.

It means there is no production completely, as is the case in South Sudan now. We have dollars but all our dollars are going for imports.We will not be able to invest in our economy because our hard currency is going out.

As a result we only consume.If import is equal to export then we have to work to improve the exports so that we don’t miss the target market.

A worker walks through Green Horizon’s New Land Farm in LuriSurre village, Northern Bari Payam – Central Equatoria state (Photo: David Mono Danga)

 

JM: which are the products that South Sudan has the potential to export if there is total stability in the country?

Mr. Doctor: If we were to settle down and there is stability in the country, people are all going back to their places, we need to produce agricultural products. Our economy is based on agriculture. So people should go for agriculture because it is very strong and can be sustained. We should produce enough to export and sustain our economy. We will consume some and the surplus will be exported.

So some of these agricultural products are: Sim-sim, Gum Arabic, Guar in Renk, sunflower seeds, cotton, coffee, watermelon, Kerekede (hibiscus), Shea Butter (Zet Lulu), and Timber, Honey, fish, livestock, animal skins, huffs and hides but unfortunately we do not have tanneries here to process and treat our animal skin, huffs and hides. We can’t export them raw.

The cattle or livestock can be exported alive or slaughtered. These are products that we have here now and we are supposed to work hard to produce more.

A tannery is a place where animal skins are processed. Tanning is the process of treating skins and hides of animals to produce leather. According to Astoria Tannery Magazine, a leading source of information on tanning and technology, the tanning hides involves a process which permanently alters the protein structure of skin, making it more durable and less susceptible to decomposition, and also possibly coloring it.

South Sudan does not yet have the scientific capacity to export livestock. The Bureau of Health Standards requires meat to be healthy enough to meet the international standards before it can be exported. We are not yet competent enough to handle animals scientifically.

The veterinary services must be adequate enough to keep these cows safer, clean and healthy. We have many benefits from cows’ huffs, horns, beef, milk and the skins and hides. In fact in Juba, there are about 50 cows slaughtered everyday but the country is not benefitting from the skins and the other raw materials.

We are urging investors to come to South Sudan and open up tannery services to process the country’s animal skins and hides.

It is important to note that some cultural beliefs and norms also limit South Sudan from exporting some of these products. For example, the Muslim countries require that an animal has to be slaughtered by a fellow Muslim to qualify it as healthy and in accordance with the Muslim customs. This removes doubts between the two trading countries.

Cattle in Bor cattle camp FB photo by Parach Mach

JM: what are our current exports apart from crude oil?

Mr. Doctor:The Ministry has now found foreign markets for the country’s agricultural products such as Coffee, Honey and Arabic gum.

In 2015 we sold one load of coffee from Yei River State to Switzerland – Europe. Last year we exported two loads of honey to Japan – Asia.  Our Arabic gum and sim-sim has been exported illegally from Renk (Upper Nile State) to Khartoum, Sudan. We don’t export it officially. But is mostly smuggled to Sudan unaccounted for, and are re-exported by Sudan to the outside world contributing to Sudan’s Gross Domestic Product (GDP). But there are efforts by our local companies like Ramciel to export Arabic gum.

According to statistics from the Trading Economics, exports in Sudan increased to 280,894 thousand US Dollars in September last year from 236,393 Thousand USD in August.

The exports averaged US Dollars 517,422.41 Thousand from 2003 until 2018, reaching an all-time high of US Dollars 4.060,977 Thousand in January, 2017 and a record low of US Dollars 141, 830 Thousand in August, 2012.

Sudan’s most important export is gold (70 percent of total exports) followed by livestock (25 percent) mostly imported from South Sudan illegally according to the ministry of trade and industry. Others products include: oil, Arabic gum and cotton. Main import partner is China (78 percent) followed by UAE, Japan, Saudi Arabia and Italy.

Mr. Doctor:South Sudan’s top imports then were raw sugar ($42.1 million), postage stamps ($31.4 million), beer ($21.5 million), railway cargo containers ($20.9 million) and palm oil ($18.6 million), the Observatory of Economic Complexity indicated.

The signing of the Revitalized Agreement on the Resolution of Conflict in South Sudan R – ARCSS, will stabilize the country the Ministry of Trade will improve the country’s exports, although we have to first substitute our imports by producing the products we import from foreign countries more.

The civil war contributed to the reduction in the country’s export potentials but South Sudan has a high potential to export agricultural products.We pray that there will be peace in the country. Everything will be fine and weshall produce more.

Poaching has seen the elephant population fall by 110,000 over the past decade to just 415,000 [Verity White/Barcroft Images]

JM: Is the ministry aware of the illicittrade in South Sudan, especially illegal exportation of timber?

Mr. Doctor:Yes! We are aware. In the whole of Bahr El Ghazel and Equatoria, we have timber but these timber are not officially exported. They are being smuggled yet it’s supposed to be with permission from the relevant authorities.

All the agricultural products are owned by communities, others by individuals in the communities but now some of the traders don’t come to the ministry of trade but deal directly with local community authorities. They make their local agreements and cut the trees.

They are supposed to come to us so that we give them the licenses. For the traders to cut the logs they are supposed to proceed to the Ministry of Forestry and Agriculture, state and local community authorities.

But this is not happening because the tree owners as well as the traders do it to dodge taxes and smuggle our timber bribing their way to Uganda. We are aware of the illicit trade going on between us and our neighbors. They are not genuine because they are not honest with us yet we are honest with them.

JM: Smuggling of products out of South Sudan

On 1 February this year, the Daily Monitor reported the detainment of Two Vietnamese men after the Uganda Revenue authorities intercepted their cargo of 700 pieces of ivory and hundreds of pangolin scales smuggled from the South Sudanese Kaya border. URA scanned three six-metre containers carrying timber logs which had been hollowed out and filled with the contraband before being resealed with melted wax to disguise their content.

An estimated 325 elephants would have been killed to acquire that amount of ivory. The International Union for Conservation of Nature estimates that poaching has seen the elephant population fall by 110,000 over the past decade to just 415,000 animals.

Mr. Doctor: TradeMark East Africa (TMEA), an organization funded by a range of development agencies with the aim of growing prosperity in East Africa through trade, is building our capacities and they have established all the monitoring and checking facilities all along from Kenya to South Sudan.

We have established a nonstop border posts from Mombasa Port, Kenya where our goods come from via Kampala, Uganda up to our border in Nimule. They are going to install electronic systems at Elegu in the Ugandan borderand in Nimule. The customs will be able to tract goods electronically. This is very important because it will minimize trade diversion.

Sooner or later, we will have all the machinery to scan anything going out of South Sudan and limited smuggling of our wildlife products. Trade Mark East Africa is helping us buy the scanners to detect any illegal commodities going out of and coming into the country.

The scanners will be established particularly in Nimule for that purpose. We started from Nimule because that is the main point.We will come to Juba International Airport after which we will go to Kaya in Yei, Nadafal, Kapoeta and all our borders will be equipped with these scanners. Although these will take time, slowly but sure, we will attain it. We just got our independence 8 years ago but we are going on well. So far so good.

JM: what are the ministry’s achievements so far?

Mr. Doctor:Our achievements in the line of trade.In October 2017 and 2018 we organized the Made-in-South Sudan Exhibition which aimed at promoting locally-made products and open up the country’s investment opportunities.

The exhibition attracted people from all sorts of life, business enterprises, companies and organizations, both local and international consumers went to taste and observe efforts put by the country to produce and fight food insecurity.

We have established diplomatic trade relationships with our neighboring countries. We have also attained internationals marketsfor our local agricultural products in Japan, Switzerland and within Africa with Sudan and Ethiopia.

We are visiting them to exchange benefits although up to now we have not yet signed official agreements on trade and this is because we have had our own problems.

In 2016 South Sudan joined the East African Community (EAC) which is a great achievement for us as a country because in Africa you can’t trade alone. You must join the blocks nearest to you so that we trade among ourselves.

On 21th March, 2018 the ministry signed an agreement to establish Continental Free Trade Areas (CFTA) in Kigali, Rwanda. That is for all the 55 African member countries with all the trading blocks to unite and come under one ceiling to trade and liberalize the African economy.

The African Free Trade Area (AFTZ) is a free trade zone announced at the EAC-SADC-COMESA Summit on 22 October 2008 by the heads of Southern African Development Community (SADC), the Common Market for Eastern and Southern Africa (COMESA) and the East African Community (EAC).

Again recently in December 2017 we gained another observer status with the World Trade Organization (WTO) in Geneva. We applied and they accepted us and now we have to negotiate for our assertion into the WTO so that we become members. There are currently 164 members in the world.

The observer status we have obtained at WTO is very important, useful and credible position for us to build our capacities through trainings and technical assistance. They visited (last month and have gone back to Geneva, Switzerland.

Our young stars are going to be trained to become negotiators, statisticians and our private sector will also be trained and once there is peace investors will come. The real investors will come in and make things better. I think these are some of the achievements. We are earning a very strong personality and position in the world.

The Observatory of Economic Complexity rated South Sudan as the 141st largest export economy in the world in 2017, when the country exported $1.23 billion and imported$532 million, resulting in a positive trade balance of $ 697 million. This is the highest since conflict broke out in 2013

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