S. Sudan’s central bank warns not to use foreign currency over SSP

By Julius N. Uma

November 22, 2011 (JUBA) – South Sudan’s central bank has warned against the use of foreign currency and called for the promotion of the local South Sudanese Pounds (SSP), amid growing concerns of rising inflation in world’s newest country.

In a strongly-worded circular addressed to the government, all financial institutions, non-governmental organisations and the general public, the bank says drafting of official or private contracts and normal rent payments should all be in SSP.

“This practice of dealing in foreign currency rather in our legal currency is not acceptable and should be discouraged,” partly reads the circular, while citing section 46 of the Bank of South Sudan Act, which says SSP is legal tender and cannot be rejected in a financial transaction.

The new currency, which came into effect shortly before the country’s 9 July independence replaced the old Sudanese Pounds, formerly used by both the North and South Sudan.

According to the bank, any government institution intending to sign contracts of an international nature can only do so by involving the finance and economic planning ministry on its behalf.

South Sudan’s national bureau of statistics recently said inflation reached 57% in the month of August, largely attributing this to the abnormal increase in prices of goods in the country.

In this regard, the country’s Central Bank now says all payment of direct or indirect taxes have to be in the local currency. This includes, custom duties, excises, levies, fees, charges and all forms of penalties related to transportation of goods into the country.

“All public budgets, financial records and accounts, required by any law or established or maintained in South Sudan, shall be or be assessed in South Sudanese Pounds,” further reads the circular, signed by Kornelio Koriom Mayik, the Central Bank governor.

(ST)