Major economic challenges in Lakes state

October 18, 2011 (RUMBEK) – Lakes state’s mid year financial report is symptomatic of the major economic challenges South Sudan faces as it adjusts to becoming an independent nation, as the international monetary crises begins to take affect, Radio Good News in Rumbek reported on Tuesday.

In the last few months the world’s newest country has had to adjust the introduction of a new currency and a stagnation of trade with the north. Since partition in July, trade with north Sudan has ground to a standstill, with Khartoum saying that the border will only reopen once conflicts in Blue Nile and South Kordofan states on the northern side of the border are resolved.

The local Catholic radio station further reported on finance minister Purr Chiengan’s statement to MPs on Monday, in which he said that people were being increasingly challenged by the increasing costs of consumer goods.

Minster Chiengan observed that since South Sudan gained autonomous rule in 2005 the amount paid to civil servants has not increased in line with inflation and cost increases. In South Sudan the state is by far the largest employer.

Private business and industry, Chiengan admitted, are put off from investing, as the state’s policies are not mature enough.

The large public sector is illustrated by the statistic that Lakes state spent 65% – 45.5 million South Sudanese Pounds ($12 million) – of its total budget just on salaries in the six months covered in the recent report.

A further SSP5 million ($1.9 million) was spent on the operational costs of government institutions, the Radio Good News report said. Capital expenditure in the state totaled SSP10 million ($4.8 million).

Expenses towards the state operation accounted for 8% of the budget while 15% was spent on capital costs.

The most reliable and lucrative source of public funds within the state, raising SSP1.5 miilion ($0.56 million), is the personal income tax on public servants, the minister told parliament.

Chiengan added that General Sales, Value Added Tax (VAT), stamp duty, and other local taxes had not performed well in comparison.

The finance minister said that he was determined to make more progress after the Draft Estimate and Appropriation Act of 2011 has been approved.

Taxes in South Sudan account for a tiny amount of the state budget with almost all income coming from oil revenues.

LAKES STATE PARLIAMENT REOPENS

The Lakes state parliament in Rumbek reopened on 3 October having been in recess since before South Sudan became independent on 9 July.

As well as MPs and officials the opening was attended by traditional dancers and police brass bands.

Speaking during the opening of third session since elections in April 2010, Lakes state speaker John Marik Makur, said that Lakes state parliament will focus on imposing freedom, democracy and the rule of law in the state.

Lakes state suffers from severe insecurity caused by banditry, cattle raiding and revenge attacks. A disarmament campaign over the last few months is hoped to reduced violence in the state.

“In this 3rd session of freedom, our focus will shift from law making to review and law implementation to measure the impact of laws passed to bring a better quality of lives to our people,” Marik said.

Lakes state Governor Chol Tong Mayay, urged lawmakers to cooperate with both the state executive and the public to create peace. He also appealed to any civilians still carrying firearms to surrender them, warning that if they did not they would be disarmed forcefully.

He called upon the lawmakers to engage in dialogue with the community as well with his office. The “doors of dialogue are open” Governor Chol said, urging for a “spirit of cohesiveness.”

“I urge every one of us to maintain this spirit and avoid unnecessary misunderstandings,” he stated. “If any of us have concerns, on my part, doors for dialogue are wide open, come one, come many, and we will engage in fruitful discussion. There is no need to suppress concerns, then turn up in an occasion to wash our dirty linen in public, it benefits nobody.”

His fourteen page long speech covered development, rule of law, peace, good governance, economic growth and feeder road constructions.

Chol listed his government’s priorities: “peace and security, maintenance of rule of law, conduct of a credible free and fair referendum, good governance, food security and economic growth, improving accessibility within the state through the construction of an all-season road network and the delivery of creditable basic social services coupled with mainstreaming of gender policies on the security situation.”

He acknowledged that the security situation had been “unstable in parts of the state, particularly after the referendum and this was attributed to the removal of the army to Abyei.”

South Sudan became independent in July following a referendum in January agreed as part of a 2005 North-South peace deal. In May the northern Sudanese military moved into the disputed region of Abyei on the North-South border and is yet to pull out.

The speaker of Lakes state’s parliament used his speech to praise the media for its role in South Sudan’s independence referendum and during peaceful disarmament in Lakes state.

“All the information structures, in their many wings, helped and are still helping in sensitizing the public to make informed decisions on political, economic, social and cultural development. Public concerns and appeals which were being aired over media such as state radios help reduce community disputes over the cattle raiding and revenge attacks from the opposing parties.”

(ST)