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From: Berhane Habtemariam (Berhane.Habtemariam@gmx.de)
Date: Thu Nov 25 2010 - 11:34:36 EST
<http://allafrica.com/sudan/> Sudan: Return to War Could Cost in Excess of
U.S.$100 Billion, Warns New Report
25 November 2010
http://www.aegistrust.org/images/reports_briefings_2010/The_cost_of_future_c
onflict_in_Sudan.pdf
_____
press release
Nairobi - A return to war in Sudan would entail costs in excess of $100
billion according to a new report published today by a coalition of European
and African economic and political think-tanks.
Published less than 50 days ahead of the landmark referendum on Southern
independence, 'The Cost of Future Conflict in Sudan', a new 35 page report
by Frontier Economics Limited co-launched by The Institute for Security
Studies (ISS) and the Society for International Development (SID) and the
Aegis Trust presents fresh analysis on the economic costs of war for Sudan,
some of Sudan's immediate neighbours - Kenya, Ethiopia, Uganda and Egypt -
and for the international community.
The report comes amid fears that the referendum could trigger an escalation
of violence.
The report recognizes the difficulties in measuring the costs of potential
future conflict. It provides different scenarios - low, medium, high
conflict scenarios and a peace scenario - and models four different paths of
economic growth.
The report concludes that while there may be some positive impacts on the
region from investment being redirected from Sudan, the evidence suggests
the net impact of conflict would be significantly negative. In particular,
costs would include:
US$50billion to Sudan itself in lost GDP
US$25billion of GDP relative to a more stable situation in neighbouring
countries; and US$30 billion in peacekeeping and humanitarian costs to the
international community
Between 10 - 20% of Sudan's GDP comes from oil. If the oil supply were to be
shut down with the outbreak of civil war, then Sudan would immediately lose
10-20% of its GDP - equivalent to $6.5-13 billion in 2011 for as long as oil
production remained shut down.
The overall cost would be particularly grave for Sudan's neighbours;
amounting to 34% of their total annual GDP over a 10 year period. Both Kenya
and Ethiopia could potentially lose over US$1billion per year.
"This report demonstrates the high cost of conflict. It implies that
domestic, regional and international parties should be asking - 'Are we
doing enough to avoid a war that might cost over US$100 billion and ruin
countless lives'?" said Matthew Bell, Associate Director of the London
based, Frontier Economics.
"It is widely acknowledged that a return to war in Sudan could cause immense
human suffering. This report should also concentrate the minds of
policymakers who are also concerned about the future economic stability of
the region," said James Smith, Chief Executive of Aegis Trust.
The referendum comes six years after the 2005 Comprehensive Peace Agreement
brought an end to the 22 year civil conflict between the Government of Sudan
and the Sudan People's Liberation Movement/Army. An estimated two million
people were killed in Sudan and four million displaced between 1983 and
2005.
"There is less than 50 days from a referendum that may change the map of
Africa. This report demonstrates that the neither Sudan, Sudan's neighbours
nor the international community can afford a serious escalation in
violence," said Kenneth Mpyisi of the Nairobi based Institute for Security
Studies.
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