Juba Beckons Kenyan Investors

Kenya Airways commences flights to South Sudan, adding to the growing opportunities in reconstruction for firms and professionals.

The government of Southern Sudan is tipping Kenyan companies to move faster in setting up businesses in Juba before other African countries invade the virgin economy.

Petroleum sales have begun to impact positively on South Sudan government revenues, supporting foreign exchange inflows from donor funding.

Visa fees collections, business licence fees and airport landing fees are also shoring up revenues. Juba, a myriad of construction sites, is now the fastest growing city in the region, creating a huge demand for both consumer goods and professional services.

Thousands of Kenyans are already working in South Sudan in building and construction, non-governmental organisations, transport, security, banking and financial services, aviation, hotels, bars and catering while many others are in private business.

Still more are in demand. Kenya Commercial Bank, having recognised South Sudan’s potential as early as 2005, has already set up seven branches. Equity Bank has opened two.

"We are now open to the world. Juba international Airport is operating 24 hours a day, and we are connected by daily scheduled flights to Entebbe, Jomo Kenyatta International Airport (JKIA) and Addis Ababa,” says South Sudan Vice President Dr Riek Machar Teny.

Juba receives up to 70 flights a day, mostly relief aircraft, says Mr Kurkuol Ajieu, the director-general of Juba International Airport. Jetlink, which pioneered scheduled flights to Juba in 2005, is now flying twice daily from Nairobi, while East Africa Safari Air Express operates one per day. Also flying daily is Air Uganda on the Entebbe-Juba route, while Ethiopian Airlines operates four flights a week from Addis Ababa, according to Mr Ajieu.

Kenya Airways commenced daily flights from Nairobi to Juba on June 7.

“We used to have complaints from visitors, who could be stuck for two or three days in Nairobi or Kampala waiting for flights,” the VP said in Juba during a ceremony held to commemorate launch of KQ flights to South Sudan.

During landing of KQ’s first flight ever to South Sudan, the controller at Juba airport requested the KQ Boeing 737-700 Captain to fly low around the city in what passengers thought was an intention to make political capital out of it.

Welcoming KQ to South Sudan, the Dr Teny said: “This inaugural service to Southern Sudan marks a milestone for us as it will help connect our region with the rest of Africa as well as the international network that Kenya Airways serves. Many others (investors) are still watching. But we have opportunities – for example, we have more wildlife than you have in Kenya. We know we need to improve the airport. But despite the difficulties, we are trying.”

Kenya Airways CEO Titus Naikuni challenged local businessmen to be more aggressive in exporting goods to other African countries.

"The KQ network has a lot of cargo opportunities. For instance, we have a customer who is already exporting sausages to Nigeria,” the CEO said during the airline’s investor briefing held a few days to the Juba launch.

South Sudan Government officials pointed out investment opportunities in road and water infrastructure, building and construction, aviation spare parts, engineering and supplies, ICT, printing and stationery as well as catering, motor vehicle repairs and maintenance and supermarkets.

Still challenging Strong demand for accommodation has seen 140 hotels and lodges spring up in Juba in the last couple of years.

More are under construction, but hotel room demand remains strong mainly from market researchers flocking to Juba. KCB, which is offering rehabilitation loans in Juba, says there is great demand for accommodation, housing and office space in Sudan.

Still, there are challenges. Juba can be extremely hot during the day. Differences in local cultures and languages and poor infrastructure constantly frustrate investors.

And having come out of a civil war, many soldiers in Southern Sudan are yet to adapt to civilian rule and a free market economy, and some of them have been extremely rough to visitors. Insecurity on the highway from Uganda has resulted in several murders of Kenyan and Ugandan truck drivers too.