Kenya stands to lose big if peace proves elusive in South Sudan

Kenyans evacuated from South Sudan arriving at the Wilson Airport in Nairobi. The last group of about 100 Kenyans arrive at the Jomo Kenyatta International Airport. PHOTO/EVANS HABIL  NATION

In Summary

• The country hosts many corporates and individual business people
• A number of businesses, especially those outside Juba, have at best remained closed and at worst been looted by the warring factions in the violence that exploded on December 15.

By Walter Menya
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Wary of loss of investments by its nationals and the influx of refugees into the country, Kenya has taken a leading role in preventing South Sudan violence from spiralling into a full-blown civil war by leading the mediation talks in Addis Ababa, Ethiopia.

A number of businesses, especially those outside Juba, have at best remained closed and at worst been looted by the warring factions in the violence that exploded on December 15.

According to the government, most Kenyan businesses in Malakal, Bentiu and Bor were looted by factions allied to President Salva Kiir or to his former deputy Riek Machar.

The three towns in Upper Nile, Unity and Jonglei states have experienced the heaviest fighting, according to Foreign Affairs Principal Secretary Karanja Kibicho.

 

“There was sporadic fighting in Juba, but that was contained. However, Kenyan businesses in Jonglei, Unity and Upper Nile states were ransacked and are grounded,” the PS said.

Mr Kibicho said Kenya’s interest in South Sudan cannot be overstated as the country hosts many individual Kenyan business people, workers and corporates and the violence has a “direct impact” on Kenyans.

Besides, Kenya is wary of a refugee influx which would further strain the country’s capacity since it already hosts at least half a million Somali refugees with accompanying security threats.

Prior to their secession from Sudan, thousands of South Sudanese refugees fleeing two decades of war with Khartoum swarmed the Kakuma refugee camp in northwestern Kenya. 

“Kenya’s involvement to restore peace in South Sudan is because we want to prevent an influx of refugees from South Sudan because our hands are already full with the Somali refugees,” the PS said.

On the business front, the safety and survival of Kenyan-owned businesses in South Sudan is a top priority.

In terms of foreign investments, Kenya has the largest presence, according to the chief executive officer of the Kenya Bankers Association (KBA) Habil Olaka.

Among the major Kenyan corporates in South Sudan are the Kenya Commercial Bank (KCB), Equity Bank, Co-operative Bank and the financial services group UAP Holding and Resolution Group among others.

There are also projected joint regional investments such as the Lamu Port-Southern Sudan-Ethiopia Transport (LAPSETT) and the standard gauge railway projects which would be adversely affected by a civil war in the world’s newest country.

ATTRACTION

Oil-rich South Sudan is also an attraction for many countries, Kenya included. The violence has seen a severe reduction in oil production as forces loyal to Dr Machar seized the main oil-producing region of Malakal in Upper Nile State.

Mr Olaka said that most of the Kenyan banks with branches outside Juba have been forced to close them and consolidate operations within Juba as they monitor the situation.

The KBA boss predicted that Kenya stands to lose massively unless a solution is reached soon and called on the government to seize the opportunity and move in to normalise the situation.

While Mr Olaka is hesitant to put a figure on the losses Kenyan corporates and individuals have incurred so far, he said the cost of doing business was rising rapidly as the entities still in operation have had to scale down operations while also increasing the security of their premises and personnel left behind

.

“The losses by these entities have been in terms of foregone opportunities. There is also an increase in the cost of securing foreigners, especially the key individuals that an entity wishes to retain to oversee the operations,” he told the Sunday Nation.

The CEO of Resolution Group Peter Nduati tweeted on January 2 that they were still serving their clients using South Sudan nationals who decided to stay but said “it’s a scale down” on business operations.

“It is difficult especially if you consider the HR angle. Difficult to make a decision regarding resumption of business in South Sudan with all the conflicting info,” Mr Nduati tweeted.

President Uhuru Kenyatta appointed a special envoy, Gen (rtd)Lazaro Sumbeiywo, to lead the mediation between the rival factions. Gen Sumbeiywo is mediating between President Kiir and Dr Machar under the auspices of the Inter-Governmental Authority on Development (Igad).

Gen Sumbeiywo was also a principal mediator in the talks that led to the 2005 Comprehensive Peace Agreement between the North and the South.

The talks to end the violence began Friday in Addis Ababa, Ethiopia, with the mediators meeting separately with representatives of President Kiir and Dr Machar. However, Kenya was optimistic that the two groups would be able to meet face-to-face by Saturday for the start of the actual mediation.

“We are asking them to cease fighting and open corridors for relief supplies to reach the affected people and the President (Mr Kenyatta) has said that Kenya will continue airlifting emergency supplies despite all Kenyans having been evacuated,” said Mr Kibicho, explaining that Kenya would not take sides in the conflict.

President Kenyatta also said the Igad states would not allow an unconstitutional change of government in South Sudan, a comment that was taken to mean that Kenya was favouring President Kiir in the conflict.

But the PS said that is far from the truth, and all the President meant was that if there is to be a change of government, it should be done within the confines of the constitution.

Kenya’s engagement in the conflict will be limited to airlifting relief supplies and restoring peace and stability, said Mr Kibicho as he dismissed the possibility of Kenya Defence Forces’ involvement in South Sudan.

Ugandan President Yoweri Museveni was quoted in sections of the press as saying that his country would intervene militarily in South Sudan especially if forces loyal to Dr Machar do not end the violence.

However, Mr Kibicho said President Museveni’s comments were taken out of context since the Ugandan President was only referring to securing vital installations and not military involvement in the conflict.

POLITICAL AND ECONOMICAL INTERESTS

According to Prof Karuti Kanyinga of the University of Nairobi, Kenya’s interest in South Sudan is both from a security and economic point of view unlike Uganda “which has always been openly biased in their political involvement.”

“Kenya has got more to lose than Uganda. The only way out is through power-sharing, but they will have to amend their constitution for that solution to happen. Without power -sharing, South Sudan may just remain unstable,” said Prof Kanyinga. But it is understood that President Kiir has ruled out any power-sharing arrangement with his rival.

Prof Kanyinga’s prescription to the problem also calls for President Kiir and Dr Machar to think of accommodating other smaller communities in whatever form of government they may agree to form outside their Dinka and Nuer ethnicities.

President Kiir is from the Dinka community while Mr Machar is a Nuer.

“South Sudan needs a visionary leader. (John) Garang had a vision but he died with that vision while President Kiir has always been a military man. What is required is a master plan for development of all regions of the country,” he added.

The latest violence several months after President Kiir sacked a number of ministers including Dr Machar who was his VP. Dr Machar has accused President Kiir of trying to eliminate political rivals. He had indicated his intention to oppose the President for the leadership of the ruling party, the Sudan People’s Liberation Movement (SPLM)