[ad_1]
JUBA, SOUTH SUDAN – Business leaders in South Sudan’s capital Juba say the new government rule mandating that all transactions be in South Sudanese pounds rather than US dollars puts their businesses at risk. to sink, while others say it is a good idea.
Last week, Information Minister Michael Makuei told reporters that the government adopted 34 measures recommended by a committee appointed by President Salva Kiir a month ago to address the country’s economic crisis. One of the measures would require commercial transactions to be carried out in local currency, according to Makuei.
“All the contracts that are made, even the rental of houses, the rental of cars, everything here in South Sudan is in hard currency. Why should we use hard currency at a time when we have our national currency? all contracts are in national currencies, not dollars, ”he said.
Lisok Emmanuel, managing director of the Juba-based Vast Printing Company, said it is not the first time the government has issued a radical change order.
“Four years ago, there was something similar that was announced that every transaction has to be done in SSP, that myself as an individual, I really appreciate that so that our currency can be recovered so that at least the local person can make a living. But now everything it’s in hard currency. Everything is in dollars, dollars, dollars, “Emmanuel told VOA’s South Sudan in Focus.
While agreeing to the order, Emmanuel said the change will limit the ability of business owners like him to import goods because it restricts access to foreign exchange, something he said is already in short supply in Juba.
If the government doesn’t enact policies to guarantee a sufficient supply of dollars, Emmanuel said companies like his could fail.
The director of one of the largest companies involved in South Sudan’s oil sector also adopted the new government rule. Robert Mbesa, chief executive of Trinity Energy, told South Sudan in Focus that doing business with local currency is a global practice that strengthens a country’s economy, but also advised the government to enact policies that boost local production.
“Invest in productive capacity, be it a factory, a farm or an agricultural processing plant, do that and then reduce imports, reduce the pressure on the pounds producing most of the stuff in the country and therefore the pounds that fall over time, it will start to get stronger. When other people outside the country start demanding goods from South Sudan, that is when the foreign currency will start to fall but the local currency will also start to strengthen, “Mbesa told VOA.
At the beginning of last week, the value of the South Sudanese pound fell to its lowest level against the US dollar. A week ago, the dollar was trading at 450 South Sudanese pounds. Shortly after the government announced plans to introduce a new currency in an attempt to control inflation, the dollar was trading at 700 South Sudanese pounds.
South Sudan’s economic problems require the application of the rule of law and the restoration of stability, according to Okumu Bosco, an economics professor at the University of Juba.
“Even if the rule is there, somebody is playing over that rule, so you can’t even do what should have been done without serious monitoring,” Bosco told South Sudan in Focus.
He said safety also plays an important role because even if some goods are produced locally, others must be imported, which requires good roads.
Many roads in South Sudan are impassable, especially during the rainy season. In addition, there have been numerous attacks on passenger vehicles and humanitarian convoys traveling throughout the country.
Bosco called for disciplined and transparent management of South Sudan’s resources to help rescue the country’s economy.
