S. Sudan’s finance minister outlines step to tackle inflation
January 23, 2016 (JUBA) –South Sudan’s finance minister, David Deng Athorbei, says the nation has taken up steps to overcome inflation caused by the ongoing devaluation.
“Most of the food is coming outside the country and therefore, we have to zero in on reducing the prices of food items as a first time to tackle inflation,” Athorbei told reporters in Juba Thursday.
“The government is taking steps trying to waive customs (duties) on certain basic items – especially food stuffs. When food prices reduce, everything will be alright,” he said when asked to outline short terms solution to surging prices of market prices since South Sudanese pound was devaluated against the United States dollars in December.
Athorbei, along with Central bank governor Kornelio Koryom, announced free floating of foreign currency exchange rate last month. The official rate was SSP 2.96 to US $1 but has since been changed to SSP 18.5 per dollar.
The minister was speaking to reporters for first time since the SSP was devalued.
The traders responded by increasing prices of items – most of which are imported from neighbouring countries by nearly six times the original selling price.
Athorbei said security agents will monitor import of essential items such as fuel, food and medicines that will be exempted of taxes.
“The economic security of our security organs will ensure that when food come in, somebody should not hide. Food must be affordable to our citizen,” he said.
He said a long term solution to inflation is increasing local production.
“In short terms, we are going to reduce customs duties. In the long term, we are going to make a production budget that will enable our citizens to produce their own food,” said Athorbei, referring to financial budget that is annually table in June in parliament.
Farming season starts in March and April in various parts of South Sudan and Athorbei did not specify how a new budget would address local production by July when a new budget comes into effect. He insisted that the situation will improve.
“My appeal to you, the citizens, is to tighten your belt. Within a short time, we shall be out of the wood,” he added.
He said President Salva Kiir’s one thousand tractors, which were launched early in 2015 are just being given out to states farmers.
“The one thousand tractors are now being given to the governors of 28 states and we hope next year harvest will be better and the issue of inflation will be history,” he said.
(ST)