Home | News    Wednesday 13 November 2013

Inflation fears as S. Sudan devalues currency by over 30%

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November 12, 2013 (JUBA) – Inflation fears are high in South Sudan after its Central Bank unexpected announced a devaluation of South Sudanese Pounds (SSP) against the US dollar by nearly 35%.

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South Sudan Pounds (ST)

The move, the Central Bank said was a reformatory measure aimed at achieving price stability in a country that heavily depends on oil exports.

“It [devaluation] will lower short-term exchange rate volatility, provide more reliable access to foreign exchange by the business community and members of the public and help to build buffers for the economy to deal with unanticipated shocks”, the Central Bank said in a statement seen by Sudan Tribune.

The local currency, according to the Central Bank, now trades at 4.5 from 3.16, while commercial bank rates now stand at 4.6, from about 3.25 against the US currency.

The move comes less than 24 hours after the Central Bank of Sudan quietly devalued its currency by 22.6% against the US dollar, which was the second move of its kind since more than a year ago.

South Sudan has had a turbulent economy since it broke away from Sudan over two years ago. The two countries are yet to sort out scores of post-session disputers, which are vital for the stability of both countries’ economies.

In Juba, the South Sudan capital, citizens began feeling the pinch of the currency devaluation, as most fuel stations ran out of petrol and diesel. There are fears that fuel prices, currently at SSP 6 per litre, could be hiked higher.

On the black market, the US dollar, which previously traded at SSP 4.5, was by Tuesday now selling between 5.0 and 6.0.

Joseph Alier, an economist, said government often devalues its currency because the interaction of market forces and policy decisions could have made the currency’s fixed exchange rate unsustainable within a given period.

"So for it [Central Bank] to sustain a fixed exchange rate, it must have sufficient foreign exchange reserves and be willing to spend them to purchase all offers of its currency at the established exchange rate", said Alier, who runs a forex bureau in Juba.

In that case, however, the country is usually forced to devalue its currency to a level that it is able and willing to support with its foreign exchange reserves, he added.

CITIZENS REACT

“The currency devaluation will certainly affect our business, not only here but in the neighbouring countries as well”, said Ahmed Ali, a cement dealer in Juba.

Warille Benjamin Warille, said the new Central Bank move will affect the country’s budget, which was drawn at the exchange rate of SSP2.9 by the time it was passed about a month ago.

“Yes, businesses supply government at the unofficial rate. Usually goods and services falls below the plan, that is one of the reasons we always have supplementary budgets. These supplements are recognition of deficit in our planning and focusing”, Warille said.

The problem with this kind of management is that budgetary controls become very difficult, he stressed.

Peter Mathiang Mayom, a South Sudanese student writing from Nairobi, Kenya urged the Central Bank to release more dollars into the black market instead of raising the official exchange rate.

Dominic Anei Lual said the newly announced exchange rate was dangerous to the country’s economy and will certainly affect the lives of many citizens.

Meanwhile, members of the national legislative assembly on Wednesday demanded that the Central Bank Governor revokes the new decision, which left many astonished.

(ST)

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  • 13 November 2013 06:58, by Lorolokin

    Fuck this idea, otherwise they can not copmpare us to Khartoum or else let’s wait for the worse.

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    • 13 November 2013 07:59, by Malou Manyiel

      What a copy and past government! The gap between the highest income and lowest income classes will be widening. Our government is really killing its citizens slowly and quietly. God help us!!!

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    • 13 November 2013 17:19, by Gatluak

      Hahahahahahaha Salva Kiir is considering him self as Sudan Vice President now and he was not by then. How come he (Kiir) compare South Sudan and Sudan economic and we are different state?. Thanks to Magok Rundial and his house members for his strangers and knowing their people’s right.

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  • 13 November 2013 07:03, by Yorwin Otor

    Well let us accept that our country has been sold to Sudan in the recent meeting between Salva and Bashir. Khartoum devaluated ther pound by 22% while ours by 30.4% just to please Khartoum. But what will happen to our local population whom we always claim that we liberated them. We are pushing them into deep poverty. How about that SPLM.

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    • 13 November 2013 08:13, by Rezingving monynok

      this is serious
      they are confused may be , or they wanted to loot

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  • 13 November 2013 07:04, by MGAAA

    Interesting how the two banks seemed to cooperate in the Sudans!The Sudans are technically one in terms of economic deals and turbulences.Businesses from Sudan can now enjoy cooperation agreement, the matrix of deceit,created by AUHIP. Have you ever doubted AU or the old OAU?? South Sudanese might be in for a surprise after all.

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  • 13 November 2013 07:05, by Tata

    It is not a surprise. We keep politicking while doing nothing. This is a sequence of inevitable events we can’t escape. (1) We failed to recognize agriculture as backbone for our survival for 8 good years. (2) We failed to construct our roads and bridges. (3) We failed to keep fuel reserves that may run the country for several years. (4) We failed to export our oil due to poor reasoning.

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    • 13 November 2013 07:13, by Tata

      (5) Few government senior officials looted CBOSS and keep that millions abroad. (7) That few officials failed to observe President’s call to transfer that money to secret Bank Account in Nairobi. (8) We failed to elect competent candidates to both National and States’ assembly. We failed to establish independent competent judiciary system. We failed ...we failed ... we failed ... and it continues.

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      • 13 November 2013 07:24, by Tata

        This is our making. We have to bear it. Next time we have to make judicious judgment in forming the government, National & State.
        On January 9th, 2005, at Nyayo Stadium, late Garang loudly said: "Oil money to be the vehicle for agriculture development". Today, after 8 years of failure, this man in the Finance Ministry insults that " We have policy. Our people to produce vegetables. There water".

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        • 13 November 2013 07:47, by Tata

          Yes, he didn’t know that rain can rain and the flood block Gulu-Nimule road. How can we as an independent country rely on food supplies from foreign countries? Eleven ministries of Agriculture in the country can’t support local production of tomato, okra, Irish potatoes, sweet potatoes, ...etc. We have about 10 million livestock population and can’t benefit of. It is shameful to import bulls 4m UG

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  • 13 November 2013 07:07, by Tutbol

    Who give a hoot about S Sudanese devaluing her currency by 30%? Can the juus remain in their US & their other clowns they cheat & manipulate at will. What does 30% have to do with poor S Sudanese. Why don’t they just remain in their Wall street they corrupted?

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  • 13 November 2013 07:13, by American Missile.

    This is the resulted of Co operation Agreement, Khartuom announced its devalues of its currency by 22.6% and now it is followed by Juba of devalues their currency by 34%.
    Can our leaders think right? this is too much to bear.

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    • 13 November 2013 08:02, by Abyei Propaganda

      Why do you nicknamed yourself "AMERCAN MISSILE"? Why not South Sudanese Missile? You are proud of America as if your South Sudan is not a country.
      TELL YOUR DEAR SOUTH SUDANESE WHY YOU ARE AMERICAN MISSILE.

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      • 13 November 2013 18:30, by Nyesi Ta

        Slavery is taking toll on us. You know those slaves who lived with their masters for quite a bit, don’t feel they are being enslaved, instead they think, they are well treated and can do anything to embrace, depend, or even die to protect their masters. Stupid slaves!

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  • 13 November 2013 07:31, by Letigolight

    If the national parliament fails to order a reversal of this central bank decision today, this will mark the unfolding of calamities on the South Sudanese citizens and collapse of the private sector! Let all these cattle keepers managing the central bank go back to their cattle camps!

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    • 13 November 2013 08:14, by Paul Chadrack

      this will accelerate the death of black market.almost all south sudanese where involved in this dirty business,its will affect the forexes also since the new rate is the same like the one in sudan,so their trader will not buy those expensive things again.sadly this action is not accompany by any wage increment which will undoubtly discourage many citizens to buy those expensive dollars.

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  • 13 November 2013 08:06, by Simon Peter Wal

    letigolight.which Parliament are you talking about!?.. This bunch of primatives though not all will never reverse this catastrophic regulation.how would they do this while fearing salary cuts when the parliament is closed.?

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    • 13 November 2013 09:23, by Letigolight

      Wal, given that the parliamentarians will fear for loss of their jobs, then, we the ordinary citizens especially here in Juba together with the affected forces - police and ordinary soldiers will rise up before the SPLM convention and overthow this regime of this banch of primitives and put capable people in a transitional government before elections in 2015!

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  • 13 November 2013 08:20, by Marco Bul

    What do u expect from primitive president who depends on errors and trials.He has been running after long-serving presidents to borrow leaves from them on how citizens are manipulated for one to overstay in power.He has joined the cartel.

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  • 13 November 2013 08:25, by Jalaby

    To Donkeys,
    Any one who reads my comment but doesn’t understand it is nothing but a donkey!!
    I told you yesterday that South Sudan economy is so associated with Sudan and will follow its older brother (Sudan) steps and I gave you a clear example and I mentioned you US & Canada economy relationship and how they are so linked to each other and

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    • 13 November 2013 08:30, by Jalaby

      I mentioned you that if US increases its interest rate then Canada will follow the day after or may be the same day, don’t you understand!!
      Read my comment of yesterday:
      http://sudantribune.com/spip.php?article48773
      Please read my comment with open eyes and open mind too otherwise you will be lost and never learn from it!

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      • 13 November 2013 08:39, by Jalaby

        Stop damning Juba government because this is something out of their hand and they can’t do anything about IT regardless who is the president or finance minister in Juba!
        I know it’s bad news for southerner elites who sold fake dream to Jonobean and couldn’t make a "true" separation from north because that’s impossible!

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        • 13 November 2013 08:47, by Jalaby

          Whether you like it or not but you guys will be following Arab/Jalaba step by step and if Arab/Jalaba fall in a hole then you will fall with them (ask God to be small hole) and if they enter a lizard hole then for sure you will share it with them!!
          Please pray that Sudan has a good economy because that will affect you directly positive or negative!!

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      • 13 November 2013 08:43, by Joseph Canada

        To you Arab kid. Calling people "Donkeys" only explain how brainless you are. If you are so smart. Did you bother to read this head as well as the first Paragraph? Since you are smart, how come you didn’t comment on Irrelevancy on this topic?

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        • 13 November 2013 08:52, by Jalaby

          To Joseph Canada,
          I think you classified yourself whether you’re a donkey or not, buddy, I appreciate that you’re very honest to yourself and I wish if all the people are so honest like you and classify themselves! Many thanks!

          Jalaby (Abo Jalabia)

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  • 13 November 2013 08:28, by Brainz

    Devaluation, with its adverse consequences, has historically rarely been a preferred strategy. According to economist Richard N. Cooper, writing in 1971, a substantial devaluation is one of the most "traumatic" policies a government can adopt – it almost always resulted in cries of outrage and calls for the government to be replaced. Devaluation can lead to a reduction in citizens’ standard of liv

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  • 13 November 2013 09:34, by Gat-khir

    At this point in time i have to verify that South Sudan is not an independent country. we are still under the government of Sudan. This Devaluation of our currency is really stupid from stupid individuals who do not care about the lives of the citizens of this country. This alcoholic-led government is a curse to us the citizen. a back of 50kg of maize is already 500ssp here in juba.

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  • 13 November 2013 12:01, by James Okuk Solomon

    From my humble analysis, it seems that the dollar’s black market of South Sudan is in control of the Central Bank, rather than the Central Bank controlling the black market. The fact that the Central Bank picks up the price of the black market (4.5) to become its official rate becomes a strong evidence that this bank of ours has lost the control power over the market. This is not out of blue, bec

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  • 13 November 2013 12:20, by BM Bol

    The irrational decision that was taken yesterday by the South Sudan Central Bank governor to devalue ssp against usd will likely be reversed after he was grilled today by the parliament, but the damage has already done as the prices of everything have gone up. Things that affect nation’s wellbeing are ought to be thoroughly thought out before they are implemented.

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  • 13 November 2013 12:40, by Jalaby

    Yet, the worse is under way to come!
    Did I ever lie to you? did I ever predict something to you that never occurred?!
    Remember what I told you before when Khartoum lifted its subsidizing from the oil and that increased the prices and caused a lot of demonstrations and riot in Sudan, remember?

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    • 13 November 2013 12:47, by Jalaby

      I told you it’s just a matter of time till Juba will follow the same Khartoum steps and lifts (partially) its subsidization against oil in the south!
      Juba has no other solution but to lift its oil support,raises tax and customs because the south is completely relying on oil regarding its revenue and the oil by itself won’t be able to cover the huge different types of

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      • 13 November 2013 12:57, by Jalaby

        the south expenses,you know the south is so stunned by western countries of being so mingy and never helped the south and not even met what they had promised before!
        Bear in mind that the south was getting goods from Port Sudan and north for free before but now on the south is required to pay to Sudan: custom,fees,transportation,cost,etc upfront and with dollar amount for any

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        • 13 November 2013 13:04, by Jalaby

          single item that comes from the north, nothing for free guys anyway these days but you know you got your freedom and broke the chain of slavery and that’s considered to be a priceless!!! just continue to pay in dollars to Arab/Jalaba and they will be happy and you will be happy too,you know money could cause happiness but could cause catastrophe at the same time,just be careful!

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          • 13 November 2013 13:11, by Jalaby

            The oil revenue will never ever reach to the poor people of Jonobean who scarified their lives and everything to get rid of Arab/Jalaba and then live a respectful and dignified life but unfortunately greedy and selfish thieves in south elites stood against their dream and shattered it away!

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            • 13 November 2013 13:18, by Jalaby

              You know the south oil revenue is divided into 3:
              1. One third of it goes to SPLA & police to cover their salaries and needs
              2. the 2nd third of it goes to different civil services such as salaries and other needs
              3. the last third of it goes directly to thieves pockets and stay right there!

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    • 13 November 2013 13:29, by BM Bol

      The decision has been reversed already. Nothing celebrates about mr.

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      • 13 November 2013 13:38, by Jalaby


        Well, even if is reversed by today for sure it will be implemented again by tomorrow because there is no solution other than that for now!!!!

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        • 13 November 2013 18:55, by Ankh

          Jalaby
          You wasted bandwidth comparing the 2 Sudans with Canada and USA.lol. Take a sit.

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        • 14 November 2013 16:31, by moto

          JALABY
          PLEASE! PLEASE!STOP YOUR IMAGINATION,WHAT YOU HAVE WRITTEN SEEM TO CAME OUT FROM BRAINLESS AND CLOSED MINDED OF STREET TALK.WHEN ARE YOU GOING TO STOP TALKING ABOUT OUR OIL?

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  • 13 November 2013 13:16, by Nguntap

    It sound to me the Governor of Central Bank has decide and approved this alone without parliament debating on this matter and enforced on 11/11/13? this clown Governor must be lunatic, how come he decide and approved such a devaluation of SSP against USD by 35% w/c will affect citizens lives and collapse soon the our country.... I am sick of this primitives leaders who handle the country affairs

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    • 13 November 2013 13:27, by Nguntap

      Cont....affairs like their own home affairs where you decide and do sth without anyone asking you whether u did wrong or right???
      This regime must gone if doesn’t care of it citizens: its doesn’t make any different from being in the bush before b/c this devaluation is chasing people back in Bush and soon SS will realized disappearance of it citizens....Shame on this you thugs leaders>>><<<<<<<<<>

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  • 13 November 2013 15:38, by hellonearth

    @ Jalaby since you know so much about South Sudan ways of running this why don’t you tell you how Sudan you country spends its money. Donkey

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  • 13 November 2013 15:43, by hellonearth

    Good News South Sudan, this implementation of the Fake Arab agenda by enemis like the governor has been revoked by our mighty parliament. SPLA OYEEEE

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  • 13 November 2013 18:37, by Nyesi Ta

    Fellows, the devaluation of SSP is a slap on Dr. John Garang’s face by useless Salva Kiir and his rotten to the core advisors.

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    • 13 November 2013 22:30, by dude

      Devuating the money of south sudan is going to be bad for the average citizens of South Sudan. devaluation of the currency will have negative effective on the economy of South Sudan. It will cause the inflation. The prices of goods will go up. It is really a bad news for our poor South Sudanese citizens. It will only be beneficial to Salva Kiir and his thieves from outsiders.

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