A subcommittee on foreign affairs in the European Union concluded there is a "high risk" of South Sudan collapsing after it becomes an independent state in July.
"With independence only a few weeks away we have moved from peace and celebration over the decision to separate Sudan, to violence and distrust," committee Chairman Robin Teverson said in a statement. "We are now facing the real risk of Africa's newest nation becoming its most recent failed state."
Voters in January voted in favor of southern Sudan's independence. The referendum was part of a peace agreement signed in 2005. Violence in the de facto border region of Abyei, oil disputes and other unsettled issues threaten to derail the peace initiative, however.
The committee said the EU must set up the structures to play a constructive role in an independent South Sudan. The world's newest nation, however, is a test case for the European External Active Service and the EU needs to get it right, said Teverson.
"If Europe with the United Nations and African Union fail, we have the promise of many more decades of misery for the people of both Sudans," he said.
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