Professional services firms look beyond South Sudan’s challenges

Not put off by South Sudan’s lack of infrastructure and tensions with its northern neighbour, multinational professional services firms such as EY (formerly Ernst & Young) and Deloitte have opened offices in Africa’s newest country.

In 2011 South Sudan declared independence after the region voted in favour of secession from Sudan. The referendum was a core component of the 2005 Comprehensive Peace Agreement that ended decades of conflict between the Sudan People’s Liberation Movement (SPLM) and the Khartoum government.

Earlier this year, EY opened an office in South Sudan’s capital Juba. Its competitor Deloitte did not respond to questions sent by How we made it in Africa, but according to the Deloitte South Sudan Facebook page it has been operating in the country since 2010. PwC and KPMG – two of the other ‘big four’ professional services firms – are yet to launch dedicated offices in South Sudan.

“South Sudan, as part of East Africa, has the potential to become a substantial market in the next few years,” says Patrick Kamau, EY managing partner for South Sudan. “The firm made the strategic decision to open an office in South Sudan in response to the investments being made by our clients, coupled with our aim to promote a business environment which will work closely with government, the private sector and donor agencies to bring about economic development in that country.”

South Sudan has few industries outside the oil sector and almost non-existent infrastructure. A number of foreign companies, especially from neighbouring Kenya, have established operations in South Sudan. In April this year, low cost airline flydubai launched flights between Dubai and Juba. In 2009, SABMiller opened South Sudan’s first brewery from where it produces the White Bull Lager beer brand.

EY says its clients operating in South Sudan are from the financial services, telecommunication, oil and gas, and mining industries. It also does work for donor agencies and government institutions.

According to Kamau, one of the biggest challenges of doing business in South Sudan is the country’s infrastructure deficit.

“Lack of adequate infrastructure hinders the ease and efficiency of doing business. This includes inadequate road, energy and social infrastructure. As a new country, institutions such as those in telecommunications and finance are still in developmental stages and governmental regulatory and legal structures still need to be strengthened in order to best support investment into the country,” he explains.

Continued rebel attacks on South Sudan’s border with Sudan could also be a concern for foreign companies looking to invest in the region. However, Kamau remains positive that these issues will be resolved.

“There is political will on the side of the government of South Sudan to stabilise its relations with Sudan and develop the socio-economic conditions of its people. This is very encouraging as the country is also building and strengthening its democratic, legal and economic institutions to ensure that it creates [an environment conducive to attracting] investments. It always takes time to totally calm decades-long instabilities, but we can all take heart that political and diplomatic dialogue is happening to achieve long lasting peace between the two countries,” he says.