South Sudan Targets Reduced Import Costs with New Inland Depots

South Sudan is set to establish Inland Container Depots (ICDs) and Empty Container Depots (ECDs) in an effort to mitigate escalating port cargo charges and enhance the efficiency of its import supply chain. This strategic development is anticipated to have a notable impact on trade dynamics within the East African region, particularly for goods transiting through Kenya's Port of Mombasa.

The landlocked nation heavily relies on neighbouring countries for maritime connectivity, with the Port of Mombasa serving as a primary gateway for its international trade. High transportation and logistics costs have historically burdened South Sudanese businesses and consumers, inflating prices for essential goods and hindering economic competitiveness.

Historical Context and Trade Challenges

Since gaining independence in 2011, South Sudan has faced significant challenges in establishing stable trade routes and ensuring reliable access to international markets. The country's logistics infrastructure remains largely underdeveloped, characterized by poor road networks, limited air and water transport capacity, and a substantial infrastructure gap. Most roads are gravel and severely affected by perennial flooding, making transport difficult, especially during the rainy season.

South Sudan's economy is heavily dependent on oil exports, which constituted approximately 90% of its total exports between 2023 and 2025. In 2023, the country's total exports were valued at $701 million, while imports stood at $1.62 billion, indicating a significant trade deficit. Key import partners include Uganda (41%), the United Arab Emirates (24%), and Kenya (13%).

Policy and Governance Framework

The Ministry of Trade & Industry in South Sudan is responsible for formulating and implementing policies to promote domestic and international trade and industrial development. The country became a member of the East African Community (EAC) in 2016, a move aimed at fostering regional integration and improving access to regional transportation corridors and markets. As part of its EAC commitments, South Sudan is working towards implementing a Customs Union and a Common Market.

In December 2023, South Sudan launched its five-year National Export and Investment Strategy, which aims to diversify its economy beyond oil, bolster local production, and prioritize integration into the EAC and the African Continental Free Trade Area (AfCFTA). The strategy also focuses on unlocking trade and investment potential in sectors such as fruits and vegetables, gum arabic, hides and skins, natural honey, oilseeds, and wildlife tourism.

Stakeholder Perspectives and Implications for Kenya

Kenya is a significant trading partner for South Sudan, serving as its second-largest transit destination after Uganda. In 2023, Kenya's exports to South Sudan amounted to $227 million, an increase from $128 million in 2018. Major Kenyan exports include edible preparations, beer, and cement.

The establishment of ICDs and ECDs in South Sudan is expected to reduce transit costs and improve the efficiency of cargo movement from the Port of Mombasa, directly benefiting Kenyan exporters and transporters. This initiative aligns with broader regional efforts to enhance trade facilitation and reduce non-tariff barriers. Analysts suggest that this development could influence near-term public debate and policy execution, with stakeholders urging clarity on timelines, costs, and safeguards.

Evidence and Data

• South Sudan Imports (2023): $1.62 billion (OEC, 2025)
• South Sudan Exports (2023): $701 million (OEC, 2025)
• Kenya's Exports to South Sudan (2023): $227 million (OEC, 2025)
• Top Import Partners for South Sudan (2023): Uganda (41%), United Arab Emirates (24%), Kenya (13%) (Import Globals, 2023)
• Value Added Tax (VAT) in South Sudan: 20% (Fuuffy)
• Electronic Cargo Tracking Note (ECTN) Cost: Up to $110 per container (The Standard, 2021)

Risks and Uncertainties

Despite the potential benefits, South Sudan's logistics sector faces ongoing challenges, including complex customs procedures, border delays, and a lack of modern warehousing facilities. The implementation of costly measures like the Electronic Cargo Traffic Note (ECTN), introduced in 2021, has added to the financial burden on importers and transporters. Political instability and insecurity have also historically disrupted trade routes and impacted Kenyan investments in South Sudan.

Unanswered questions remain regarding the specific timelines for the establishment and operationalisation of the ICDs and ECDs, the total investment required, and the mechanisms to ensure transparency and accountability in their management. The long-term impact on port revenues for Kenya and the competitiveness of other regional ports also warrants close monitoring.

What to Watch

Stakeholders will be closely observing the progress of South Sudan's ICD and ECD initiative, particularly its impact on reducing cargo clearance times and overall import costs. The effectiveness of these new facilities will be crucial for enhancing South Sudan's trade efficiency and further integrating it into the East African economic bloc. Continued collaboration between South Sudan and Kenya on infrastructure development, such as the LAPSSET corridor, will also be key to unlocking greater regional trade potential.