South Sudan bank running out of foreign currency: official
By Ngor Arol Garang
August 23, 2010 (RENK) — The finance minister for the semi-autonomous region of Southern Sudan said on Monday that the government there is running short in foreign currency because of Khartoum remitting the South’s share of oil revenue in local currency.
David Deng Athorbei, the regional minister of finance and economic planning, who made the revelation said the move by the ruling National Congress Party (NCP) was deliberate.
“This is a clear and complete violation of the Comprehensive Peace Agreement. It is one of the most serious violations of the CPA because it has dire consequences,” said Athorbei.
Under the 2005 landmark peace deal between the north and the south, the Government of Southern Sudan’s 50% share of revenues generated from oil within its territory should be paid in hard currency into accounts managed by the Bank of Southern Sudan.
Athorbei noted that this was not the first time the central bank had changed payments for the oil exported from foreign currencies to Sudanese pounds.
“The changing of the hard currencies especially dollars has political motivations and was intentionally coined to suppress [the] economy of south Sudan. This is not the first time it is happening. They have done a lot in the past but [… ] not to this extent”, said the minister.
He called for immediate intervention by Salva Kiir the President of the autonomous Government of Southern Sudan.
“This situation requires immediate intervention of the presidency because it is becoming political issue”, he said.
The finance minister stressed that the NCP and the Sudan People’s Liberation Movement (SPLM) need to give the situation immediate attention because it was affecting the implementation of developmental projects whose materials and equipments are imported from foreign countries to the region.
Salvatore Garang Mabiordit, undersecretary in the finance ministry told Sudan Tribune that the change in disbursement currency have not only affected the government institutions but also the private sector.
“Everybody is now affected because [the Bank of Southern Sudan] cannot supply other banks in the south let alone foreign transactions in dollars,” said Mabiordit
Mabiordit said that he spent many days in Khartoum last July discussing financial issues including remitting oil revenues in local currency with authorities from the central ministry of finance and central bank.
“I spent days discussing it with relevant authorities while in Khartoum but it appears that little attention has paid,” he said.
The new development appear to be in line with the severe shortage in hard currency experienced by the country which has prompted Sudan’s central bank to undertake radical measures which limits how much travellers can buy from foreign exchange bureaus.
Travelers from Sudan are only permitted to take a maximum of the equivalent of 2,000 Euros of any foreign currency out of Sudan after providing the necessary documentation to justify the need for it. The travellers will be able to buy the foreign currency before leaving the country but can only receive it at the airport after clearing immigration and customs.
A report released by the International Monetary Fund (IMF) earlier this month showed a sharp decline n reserves held by the Sudan central bank from $1.58 billion in 2006 to $390 million in 2009 which is estimated to cover a little over two weeks of imports.
The IMF has set a target for Sudan to increase its reserves by $560 million to reach $950 million by the end of 2010.
Sudan central bank intervened utilizing its forex reserves to prevent the pound from sliding further in the market against the dollar particularly during the 2008 global financial crisis.
Most of Sudan’s foreign exchange earnings comes from the oil exports, which the IMF projects will moderate over the medium term. Other sources include inbound transfers from Sudanese expatriates abroad and foreign direct investments.
(ST)
Mabior Philip from Juba contributed to this report
Paul Lokuji Micah daudi
South Sudan bank running out of foreign currency: official
My Fellow South Sudanese,
The question is not of tribalism but of a definite attempt to make South Sudan goes melting in the economy,why is it that this flow of currency just in July was stopped why not from the right beginning if its because of corrupt South Sudanese whom run after foreign tenders,I don’t disagree with some points you put forward yes there are those tenders that are beyond reasoning capacity of each individual to what they will serve the South,this is not time for that to look at even if our fellow country men had gone far in corruption but its not the moment lets look on the common enemy.Our house business is simple to sort out not like a disaster from far.
Keep up the fight Athorbei and the South is watching.
Angelo Achuil
South Sudan bank running out of foreign currency: official
There will be terrible exponential economical repercussions within months if SPLM & NCP do not address this issue immediately. Remember Zimbabwe’s currently.
Wal P Muoranyar Biet
South Sudan bank running out of foreign currency: official
“Money can be made, people can be born again, house, skyscrappers can be built again and livestock can be raised again, but the land lost can never be recovered whatsoever we do” Said John Garang De Mabior!
Let’s be prepared to loose money and lives, but not our land. Let’s look at this as another delaying tactic deployed by NCP. We stood up for 22 years without money not even enough foods and medicines, I believe that we can stand up for 140 days.
Peace be onto Southern Sudan/Cush
Long live SPLM, Long Live GOSS
Wal Peter Muoranyar Biet
James Okuk Solomon
South Sudan bank running out of foreign currency: official
The use of the Sudanese Pound in Juba and the whole of Southern Sudan is not a bad news to the poor masses because they have no favorites abroad to wire dollars too. Those poor masses use the local currency (SG) and barter methods sometimes, and they are not in direct need of dollars or any other foreign currency. It is the “handful cliques in Juba who will face the consequences” for they are the ones who need dollars and other hard currency to send to their sweethearts and hidden children abroad.
So, either “handful cliques in Juba” bring their families and relatives back home in Southern Sudan to share the same life with the poor masses or face the difficulties of the hard currency drought in the South because the source in Khartoum is being affected by financial global warming.
May be the God of the poor masses in the South is coming to their rescue through this financial drought; who knows!!!