IMF, S. Sudan sign agreement for $112.7m in emergency funds
November 23, 2022 (WASHINGTON) – The International Monetary Fund (IMF) and South Sudan have reached a staff-level agreement for the release of about $112.7m in emergency financing.
This was reached during a meeting between the IMF team led by Niko Hobdari during a visit to South Sudan from November 7 to November 17, 2022.
The team held discussions with the authorities on an existing Staff-Monitored Program (SMP) and on the authorities’ request for access to emergency financing through the new Food Shock Window of the Rapid Credit Facility (RCF) to address urgent balance of payments needs.
The IMF team also discussed South Sudan’s request for a 9-month Program Monitoring with Board Involvement (PMB).
“This emergency financing under the new Food Shock Window will help South Sudan address food insecurity, support social spending, and boost international reserves,” the IMF said in a statement on Tuesday.
The IMF’s executive board, it said, will approve the financing in the coming weeks.
In early November, United Nations agencies said up to 7.8 million people in South Sudan, two-thirds of the population, may face severe food shortages during next year’s April-to-July lean season due to floods, drought, and conflict.
South Sudan erupted into civil war shortly after getting independence from Sudan in 2011 and while a peace agreement signed four years ago is largely holding, the transitional government has been slow to unify various military factions.
“The combination of continued localised conflict, four consecutive years of severe flooding, and the rising price of staple commodities from Russia’s war in Ukraine has increased the number of people experiencing severe food insecurity,” it said.
Meanwhile, the IMF lauded actions taken by South Sudan’s Finance ministry and the Bank of South Sudan since August 2022 to restore fiscal discipline and rein in money growth, which has stabilized the exchange rate in recent months.
It urged authorities to continue prudent fiscal and monetary policies and to consolidate and build on first steps taken needed to improve public financial management.
(ST)