South Sudan lacks enough revenues to fund budget

May 28, 2015 (JUBA) – South Sudan has announced its inability to generate enough revenues to fund the country’s annual budget, amid allegations that government may halt paying for basic services.

Presenting a paper at an economic and development forum held on Wednesday, the deputy finance minister, Mary Jervase Yak said government was only able to generate a third of its budget.

The government, she added, now relies on borrowed loans to fund the remaining deficit.

“The government has been looking for both domestic and external loans to fund the budget”, Yak told the forum, saying government now borrow money from its central bank.

The ongoing war and the decline in global oil prices caused the fiscal deficit, she said.

“The parallel exchange rate has affected the pound that it depreciated by 50% against the US dollar during the last 12 months, as the fall in oil revenues has reduced the availability of foreign exchange in the market,” explained the deputy finance minister.

Prices of goods are yet to be increased in line with the depreciation, she added.

However, traders involved in exchange of foreign currencies in the black market say the rate of the dollar against the pound has doubled in the last few months, while residents asserted that traders have more than double increased consumer prices this year.

The deputy minister urged the forum to contribute expertise ideas and make recommendations on how the government would work to improve the nation’s economy.

(ST)