Report counts cost of prolonged war in South Sudan

NAIROBI - South Sudan's conflict could cost regional nations Ethiopia, Kenya, Sudan, Uganda and Tanzania a combined $53 billion if it lasts another five years as they deal with refugees, security needs and other spillover effects, a report said on Wednesday.

London-based consultancy Frontier Economics estimated that South Sudan's economy contracted by 15 percent last year as a result of the civil war, which has killed more than 10,000 people in the world's newest country and curtailed oil output.

The human and economic costs of the conflict highlight the need for swift international efforts to end the fighting, the report said. It forecast South Sudan would forego up to $28 billion in economic growth if the war were to continue for five years while Ethiopia, Kenya, Sudan, Uganda and Tanzania would have to take in more refugees and face extra security costs.

South Sudan's annual gross domestic product was estimated at $11.08 billion in 2013, according to World Bank data.

"Without a swift end to the fighting, South Sudan runs the risk of becoming a failed state," said the report, released in the Kenyan capital Nairobi. "Worse still, it could become the epicenter of a full-blown regional conflict."

"To ensure this is not the trajectory for South Sudan will require African leaders, with the full backing of the international community, to take swift and decisive action, and to sustain that action," it said.

Frontier Economics prepared the report on South Sudan, one of the world's poorest nations, in collaboration with South Sudan's Centre for Peace and Development Studies and Uganda's Center for Conflict Resolution.

It called on the Intergovernmental Authority for Development (IGAD), a regional grouping of African nations, to step up pressure on the South Sudan government and rebels, which have agreed to ceasefire deals since the conflict erupted in December 2013 but have then ignored them.

As well as fatalities, more than a million people have fled their homes in the country of 12 million since fighting began and acute malnutrition is a major problem.

The report's economic forecasts covered various scenarios depending on the intensity of conflict and level of oil production.

Based on those, it said the cost to South Sudan if the conflict continued for one to five more years would be between $22.3 billion and $28 billion. The impact of that lost growth when calculated over 20 years would amount to between $122 billion and $128 billion.

Spending on security in South Sudan, which is almost solely reliant on oil revenues for income, could rise by $2.2 billion were the conflict to last another five years.

Ending the conflict in one year rather than five years could also save the international community nearly $30 billion in spending on peacekeeping and humanitarian assistance, according to the report.