Home | News    Sunday 24 November 2013

S. Sudan silent on $4.5bn loan obtained after oil shutdown

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November 22, 2013 (JUBA) - South Sudan’s ministry of finance has declined to explain how it allegedly borrowed $4.5bn from financial lending institutions and foreign governments following last year’s abrupt oil shutdown after a dispute with Sudan.

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South Sudanese finance minister Aggrey Tisa Sabuni speaks at an event in London on 2 October 2012 (Photo courtesy of ELSA London)

The move, according to multiple officials, has affected regular payment of the employees as government tries to pay back loans it acquired to salvage its economy, which nearly collapsed.

Finance minister Aggrey Tisa Sabuni has confirmed that the government intends to pay back the loans using oil revenues.

"As I speak the payment of four shipments have not come. They all have gone to those companies we borrowed from. The borrowing to the tune of $4.5 billion must again be paid out of domestic collections, non-oil revenues as well as oil revenues”, Sabuni said in a statement broadcast by the state-owned SSTV on Thursday.

He did not, however, explain how the money the government is currently paying back at the expense of delaying paying its employees was used.

Till now, it remains unclear as to why the government entered such extensive borrowing from financial institutions when it had claimed previously that it held reserves, which would last several years even if oil production remained shut down.

"Business people and financial lending institutions take advantage of the situation the country underwent. I knew the potential would be disastrous because we would see interest rates spike across the board. We would see huge crash in the hard currencies like dollar, but there is no alternative", Sabuni said.

"People counted on the financial lending institutions and getting it back, is now affecting the regular payment of the employees and other development projects", added the minister.

Some officials at the ministry of finance, meanwhile, claim they did not know that such a huge amount of money was borrowed from different financial institutions during the oil shutdown.

"It is astonishing development for me. I did not have prior knowledge even though I am in the directorate where such activities would have been known. I only came to learn about it during the annual budget presentation. But I knew the government was borrowing anyway”, a senior finance official who preferred anonymity told Sudan Tribune on Friday.

He said he knew the consequences of the loan were avoidable.

The consequences, another source added, are so severe that even as the country enters the end of the year, it is still not able to ultimately pay employees regularly and to lift the government’s borrowing.

COUNCIL OF MINISTERS DIRECTIVE

On Friday, however, a council of ministers’ meeting chaired by president Salva Kiir directed the finance ministry to pay all salaries of civil servants before Christmas.

The directive, information minister Michael Makuei said, came moments after the finance minister had briefed his counterparts on the revenues it obtained from oil, which had been planned to service external debts.

(ST)

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  • 24 November 2013 08:07, by Jalaby

    I believe both Sudan & S Sudan are idiot, they both desperately need the oil income and can’t make it without it and then suddenly the south surprised Sudan and the whole world and decided to shut down its only source of revenue, and when it became so difficult for the south to continue without the oil, the south asked the north to open the pipeline and again

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    • 24 November 2013 08:14, by Jalaby

      Sudan surprised the south and the whole world and said "No" despite the oil is the backbone "at least for now" for Sudan economy in terms of foreign currency revenue!!
      Now Sudan is paying back to oil companies (Chinese,Indians, Malaysians) what it was not able to pay during the oil war with the south,now the south is paying back to loaners what was borrowed before

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      • 24 November 2013 08:20, by Jalaby

        from them to rescue its economy, I believe both countries will pay back the principle amount they borrowed plus the interest indeed, nothing for free buddies!
        Ironically, the south decision of stopping its oil production to punish the north like a husband who becomes angry with his wife and then decides to revenge from her by cutting his own penis! LOL LOL

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        • 24 November 2013 08:28, by Jalaby

          Ironically, the north decision of not opening the pipeline to allow south oil to pass is like a husband who becomes angry with his wife and then decides to revenge from her by cutting his own testicles! LOL LOL
          I hope now north and south learn the lesson and stop fighting like kids and badly harm their families,they are created to cooperate and integrate,not to fight

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          • 24 November 2013 09:37, by Son of Upper Nile

            Jalaby I agree with you for the 1st time, But not that S. Sudan & Sudan r idiots. It’s the decision makers in both countries

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            • 24 November 2013 12:48, by Mi diit

              I believe that incompetent Kiir and his partners in crime have diverted to their personal accounts abroad 80% of the borrowed money. Kiir knows he will lose power soon and is building an empire of stolen money. But God will make him and his partners in crime vomit (painfully) such monies of the poor people of South Sudan.

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          • 24 November 2013 13:07, by Lorolokin

            Jalaby,
            This time round you heve done a good job , you know while I was typing am laughing in tears as such today I feel good with your observation otherwise you should have been writing like this b4 . I think since you have turned to be writing the truth you will win the support of those who speak out in both Sudan and South Sudan.
            Kinkak

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  • 24 November 2013 08:11, by Lotodo Awino Odug

    2 billions could be for the durra saga, now the hornbill pain is everybody pains.

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  • 24 November 2013 08:40, by Ambago

    Readers
    H.E. Sabuni is only a couple of months old as the boss of this Finance ministry, so don’t bother him. Why not the good for nothing national legislative assembly (NLA) grill president S Kiir as to how this loaned money was acquired and spent.
    After all according to the chairman’s(president} widely circulated announcement the structures of SPLM party they claim to represent is no more!

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  • 24 November 2013 09:24, by marie

    You are funny Jallaby. South Sudan is stupid a stupid to castrate itself forgetting that the wife would marry another husband.

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  • 24 November 2013 10:27, by Machiek

    the government, must stop cheating his own civilians, people re educated that is what you should know. stop lying!
    4.5billion what a joke.

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  • 24 November 2013 11:52, by daniell

    One thing the government of South must know is that there will be always a lending institution whenever it is in need.But the spending is within it limits so be careful alway or remindful of how this loan is use so that the external debt can be paid.It is not prude in the view of a financial sense to take loan to paid employees when their service has/will not translate into profit but loss.

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  • 24 November 2013 13:00, by tootke’bai-ngo

    You got to be kidding me! $4.5bns? How could S.Sudan borrowed & used such an amount in just one year? something is wrong here, S. Sudan during interim period was getting only $2bns per a year according to GOSS and that was enough to pay civil servants, army forces and small projects at the time,how could we double such amount when extreme austerities were applied for that peroid? this is a jok!!!!

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  • 24 November 2013 13:08, by tootke’bai-ngo

    This is an evidence of another corruption spree, how could this be allow to happened especially after Government announced its’ commitment to eradicted corruption resulting to this year’s dismissal against two minsteries(finance & cabinet affairs). This is a disgraced if no transparency on oil revenues this time again.

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    • 24 November 2013 14:44, by dude

      The people who South Sudan have not get the fruits of the country yet since we get independent. the government has sold part of our country wealth. crazy government be removed from South Sudan. loan, loan, loans. What wrong with the governmen

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  • 25 November 2013 04:00, by Naath Raani

    I think the government is really confused. South Sudan leadership is in confined space.

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