20101128
africanews

A new report by a coalition of European and African economic and political think-tanks shows that the return to war in Sudan would entail costs in excess of US$100 billion. The 35-page report also recognises the difficulties in measuring the costs of potential future conflict.

According to a press statement from the coalition, the new report published less than 50 days ahead of the landmark referendum on Southern independence is titled: The Cost of Future Conflict in Sudan presents fresh analysis on the economic costs of war for Sudan, its immediate neighbours and the international community.

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 to 20 percent 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 its GDP equivalent to US $6.5 to 13 billion in 2011.

The overall cost would be particularly grave for Sudan’s neighbours; amounting to 34 percent of their total annual GDP over a 10 year period. Both Kenya and Ethiopia could potentially lose over US$1billion per year.

“There is less than 50 days from a referendum that may change the map of Africa. This report demonstrates that Sudan, its neighbours and the international community cannot afford a serious escalation in violence,” said Kenneth Mpyisi of the Nairobi based Institute for Security Studies.

The new report was prepared by Frontier Economics Limited co-launched by The Institute for Security Studies (ISS), the Society for International Development (SID) and Aegis Trust.

The report comes amid fears that the referendum could trigger an escalation of violence.