The World Bank on Thursday urged South Sudan to reform its public finances, improve transparency and invest in climate resilience, warning that declining foreign aid and worsening climate shocks threaten development in the world’s youngest nation.
Speaking at the launch of two World Bank reports at the University of Juba, the Bank’s South Sudan country manager, Charles Undeland, said weak fiscal discipline, limited transparency and heavy dependence on oil revenues were constraining growth and service delivery.
The reports say South Sudan has significant potential to better manage its natural resources, but poor oversight of oil revenues and spending priorities has limited benefits for citizens, with funds often diverted away from basic services such as health, education and water.
They recommend improving revenue management, reprioritising spending and investing in climate resilience, particularly climate-smart agriculture and decentralised energy, to help communities adapt to worsening climate impacts.
“These are core analytical reports looking at the public financial system and the impacts of climate change on development,” Undeland said. “The message is clear: we want to work with South Sudan to help put its public finances in order so it can meet the challenges it is facing.”
The reports—covering public finance and climate change—were launched in the presence of senior government officials, including Deputy Finance Minister Yien Gach, Undersecretary at the Ministry of Finance Benjamin Ayali and Undersecretary at the Ministry of Environment James Africano Bartel, alongside academics and development partners.
Undeland said weak data availability and limited transparency continue to undermine effective policymaking and public accountability, particularly around oil revenues.
“One needs visibility on what is earned, borrowed and spent—across oil revenue flows, budget execution and liabilities,” he said, adding that reliable data is essential for citizens, parliament, investors and donors.
He warned that the need for reform had become more urgent as external financing declines. According to the World Bank, official development assistance to South Sudan in 2025 fell to about half the average received between 2019 and 2024.
“This drop is rapid and it will continue,” Undeland said, adding that aid has been critical for basic services such as health, water and education.
On climate change, he cautioned that recurrent flooding—now occurring annually—could become the “new normal” within two decades, with severe economic consequences.
“Without adaptation, GDP losses could reach up to 13 percent by 2050,” he said. “The longer we delay investing in resilience, the more livelihoods will be disrupted.”
Undeland also pointed to untapped economic potential beyond oil, citing forestry, fisheries, tourism and agriculture as possible drivers of future growth.
“Non-timber forest products alone could generate more than one billion dollars,” he said, adding that fisheries could support one in six South Sudanese, while tourism remains largely undeveloped.
However, he stressed that economic progress would be impossible without peace and stability.
“There’s no way we’re going to have development with massive displacement or persistent conflict,” he said.
The World Bank said it remains committed to supporting South Sudan as it moves away from “business as usual” towards improved governance, resilience and inclusive growth.
Deputy Finance Minister Yien Gach welcomed the reports, describing them as a roadmap for addressing prolonged economic fragility and climate vulnerability.
He said the Public Finance Review offers practical recommendations to improve fiscal governance and efficiency, while the Country Climate and Development Report identifies priority investments to strengthen resilience, including climate-smart livelihoods, sustainable natural resource use and energy access.
Gach acknowledged that conflict, climate shocks and declining international aid have constrained government capacity, stressing that prudent and transparent public financial management is now essential.
University of Juba Vice-Chancellor John Apuruot Akec said the reports accurately reflect the depth of South Sudan’s public finance challenges, citing weak institutions, heavy reliance on oil revenues and poor revenue mobilisation.
He said tax collection remains extremely low—about four percent of GDP—while oil revenues are often spent outside the budget, undermining fiscal discipline.
Akec also criticised exchange-rate distortions, weak coordination between fiscal and monetary authorities and political interference in the civil service, calling for sustained reforms to strengthen institutions, boost domestic revenue and invest in human capital.