Confronting the resource curse in a new oil nation : exploring the role of Norway's Oil for Development program in South Sudan
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South Sudan is the world’s youngest nation, gaining its independence from Northern Sudan in 2011. Independence was preceded by two phases of civil wars, which combined lasted for almost four decades. At independence, 75 percent of Sudanese oil reserves fell to the territory of the South, which meant that Sudan lost a major part of its oil income. At the same time, South Sudan relies on Sudanese infrastructure in order to export its oil. While the two countries remain economically interdependent, several disagreements remain, such as those related to border demarcations and sharing of oil revenues. The government in the newly established Republic of South Sudan is faced with the enormous task of building a state from scratch. The country remains underdeveloped in terms of infrastructure, communication and social services, and poverty is widespread. Whereas the era of civil war with neighbouring Sudan is over, violence in the form of inter-communal violence and guerrilla activities continues to threaten the internal security situation. This thesis follows a qualitative research approach in the form of a case study of main developmental challenges in South Sudan, which is brought into a conversation with a broader literature that examines the phenomena of the so-called resource curse. According to the resource curse theory, countries rich in natural resources tends to experience negative developmental outcomes, such as poor economic performance, conflict, and low levels of democracy. The resource curse hypothesis is adopted in the Oil for Development program, a Norwegian aid program that aims at assisting recipient countries in sound management of petroleum resources. The main research objective of the thesis is to explore the program’s potentials and limitations in terms of confronting the resource curse in South Sudan. According to the study’s findings, potentials include assistance in the development of oil-related legislation, and various capacity building activities within the country’s oil ministries. These efforts have the potential to strengthen the state’s ownership over its oil resources, equip people in the ministries with necessary oil revenue management skills, and to help establish a culture of transparency in the country’s oil sector. However, the program insufficiently addresses underlying problems such as patronage structures, corruption and the weak position of South Sudanese civil society. The program also comes short in terms of certain long-term objectives, such as diversifying the South Sudanese economy, initiating a broad and inclusive political process, ensuring equal distribution of the country’s oil wealth, and establishing a condition of sustainable peace.