Home | News    Friday 18 December 2015

South Sudan increases fuel prices amid further devaluation of local currency

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December 17, 2015 (JUBA) – South Sudan’s state-owned Nile Petroleum company has announced that the recent decision by the Central Bank of South Sudan has forced them to impose new higher prices of fuel, increasing the retail sale three times higher to 22 South Sudanese pounds (SSP) per a litre.

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A long line of motorists wait to fill up at Runway petrol station in Western Bahr el Ghazal capital Wau on 12 September 2014 (ST)

“You are all kindly notified effectively today the, 17th December, 2015 Nilepet new fuel rates shall be as follows: 1. Whole Salve rate (one truck) is 20 SSP per litre; 2. Depot is 21 SSP per litre; 3. Retail rate is 22 SSP per litre,” Nilepet said in a circular sent out on Thursday, a copy of which obtained by Sudan Tribune.

The instructions to increase the fuel prices was sent out to all fuel station managers in the country by Chol D. T Abel, the director general of downstream Nilepet.

The new development comes only three days since South Sudan central bank announced free floating of the South Sudanese pounds against foreign currencies, prompting further devaluation of the South Sudanese pounds with 20 SSP to 1 US dollar in the banks.

South Sudanese top officials of the central bank and the ministry of finance and economic planning said they were forced to float the currency due to lack of US dollars in the reserve and the decrease in oil production because of the two-year old violent conflict in the country.

Before the 15 December 2013 war erupted the official rate of the exchange was 2.9 SSP per 1 dollar and the price of fuel was only 6 SSP per litre, which has now jumped to 20 per litre according to the new announcement.

“Please note this change has been sparked by the Central Bank of the Republic of South Sudan,” Nilepet official Chol further explained to the public in his order on Thursday.

Following announcement of realignment of local currency exchange rates, fuel stations and other shops remained closed in Juba and other major towns for the last three days, prompting the Nilepet management to act.

However, the decision of the central bank has been welcomed by several international economists and think-tanks organizations in Juba, particularly due to the fact that those who poses dollars, such as international organizations will buy dollars at ease with high rate.

“South Sudan’s decision to float its currency is much welcome, in light of deteriorating oil prices and the exhaustion of reserves,” said International Growth Centre (IGC), a London-based research group working in South Sudan in a statement on Thursday.

Keith Jefferis, an IGC Consultant and former deputy governor of the Central Bank in Botswana said “the exchange rate is arguably the most important price in an economy especially for an open economy country like South Sudan, and maintaining the fixed exchange rate was clearly unsustainable.”

Jefferis had authored an IGC report for the government of South Sudan in October.

The limited supply of United States dollars from the Central Bank has meant that only a few people could access dollars at the official rate of 3 SSP to the dollar, while the vast majority of the people were left to source dollars in the black market at a rate nearly six times the official rate.

The differential access to dollars at the official rate distorts the market, and created an opportunity for those with access to dollars at the official rate to engage in “round tripping,” IGC said in a statement extended to Sudan Tribune.

Richard Newfarmer, country director of the IGC’s programme in South Sudan, said that allowing the banks to buy and sell dollars at market rates will free more dollars, benefiting more those who posses dollars.

“People who have dollars will now be willing to exchange their dollars through the banks, thereby allowing the banks to meet the needs of their customers, including importers and individuals with dollar deposits,” said Newfarmer.

It is not clear if the government will also issue prices for other commodities in the market after releasing the price of the fuel.

The sudden fuel price increase seems to be the first bite among expected "shocks" in the market due to the floating of the exchange rate.

(ST)

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  • 18 December 2015 06:36, by Mi diit

    South Sudan has gone to the dogs for sure!

    A failed Dinka collective tribal leadership led by Salva Kiir and the Jieng (Dinka) Council of Elders (JCE).

    repondre message

    • 18 December 2015 07:20, by dinkdong

      Mi diit,
      Everyone including Riek, and you and I have contributed to the destruction of this country. Let’s avoid taking side and use of divisive language or South Sudan will not be a sovereign nation in the near future.

      repondre message

      • 18 December 2015 07:28, by dinkdong

        ... If we would have join hands and condemn these fools called Kiir and Riek when they started to struggle for power, we would not be in this mess right now. But instead, we took sides and made it a Dinka-Nuer issue. Shame on us all!

        repondre message

        • 18 December 2015 07:35, by dinkdong

          ... I wish the world leaders were like Senator Corker of the United States who pointed out last week how Kiir and Riek should end up in jails. Nobody ever said the truths like that, not even Obama. They tend to like one side than the other and in some ways wish or support the on going civil war. F this world!

          repondre message

      • 18 December 2015 07:30, by Mi diit

        dinkdong,

        You are lying and trying to deny the truth of the obvious matter.

        I am not the president of South Sudan and I have not formed a tribal Nuer organization to advise me on how to run the affairs of the nation on behalf of the rest of 63 tribes.

        Face it head-on, or you are a passive being.

        repondre message

        • 18 December 2015 07:44, by dinkdong

          Mi diit,
          I might be whatever you called, but the problem with folks like you is because you can’t feel the pain of South Sudan civil war. I am sure you are one of those individuals outside the country and you seem to blindly support what you are not partaking. Good luck with that attitude!

          repondre message

          • 18 December 2015 15:18, by Below the Law

            Dingdong, you and I who always condemn Salva and Riek for causing this mess are real S. Sudanese. I recently realize that Midit is Riek himself. He never speaks for S. Sudan but always for Riek. S.Sudan is neither salva’s nor Riek’s. DD, keep speaking for S. Sudan not for selfish leaders. Midiit, as long as we blindly follow leaders on tribal lines we will always be a no nation till Jesus comes.

            repondre message

            • 18 December 2015 21:49, by dinkdong

              You are absolutely right Below the Law!
              As per Mi diit and whether he is Riek himself, I would have to say he is not Riek but a die-hard supporter of Riek. He is a total Nuer who forgot whatever they got is a payback from what Riek did in 1991. Let him deal with it. However, I know Riek is NEVER going to be the president of South Sudan. The guy is not trustworthy. He switched sides a lot.

              repondre message

        • 18 December 2015 09:39, by Khent

          Mi diit

          Didn’t you people fail South Sudan when your entire tribe defected to Khartoum? Didn’t you fail South Sudan when you helped Khartoum to take control of the oilfields, which gave Khartoum billions of dollars that it then used to acquire weapons - weapons that it used against Southerners!? Hundreds of thousands died because of your treachery. Don’t you dare speak, traitor.

          repondre message

          • 18 December 2015 09:43, by Khent

            Many Nuer who rallied to the Nasir commanders did so because they thought that now the Nuer would rule as the Dinka were accused of ruling before. (The Root Causes of Sudan’s Civil Wars: Peace Or Truce, Douglas Hamilton Johnson)

            repondre message

    • 18 December 2015 08:15, by okucu pa lotinokwan

      The result of the failed state have come,which lead to the end of the SPLM party,it never and will not happen to a country to surrender its currency against another currency.
      The minister for Finance and the governor of the central Bank should resigned otherwise the local communities is at his or her suffering.

      repondre message

    • 18 December 2015 09:21, by Khent

      Mi diit

      And would you [Khartoum’s dogs] do a better job? I very much doubt it.

      repondre message

      • 18 December 2015 18:49, by Whortti Bor Manza

        Mr. Kent,
        Why are you not reasonable and logical? Khartoum Dogs are those of Salva Kiir and his cabals. I mean those who were assigned by Kiir to sign the cooperative frame agreement between Sudan and South Sudan by agreeing to pay Sudan USD 26 per barrel.
        A dog is an animal who cannot think and learn lessons. Kiir was right to describe his colleagues as dogs.

        repondre message

  • 18 December 2015 07:45, by Ayuiu Makuac Lam

    If I were David Deng Athorbei as finance minister & economic planning and central bank governor Karnelino Koriom Mayiik, we would have to resign we experienced the hardship of how to control country economy.

    repondre message

  • 18 December 2015 07:46, by Ayuiu Makuac Lam

    If I were David Deng Athorbei as finance minister & economic planning and central bank governor Karnelino Koriom Mayiik, we would have to resign we experienced the hardship of how to control country economy.

    repondre message

  • 18 December 2015 08:29, by Eastern

    .....But this is not news; I have been buying petrol in 1.5 litre bottle at SSP 50 for the last two months. If you doubt me, please move along the St Kizito-Mia Saba road and you will prove what I am talking about: women, obviously wives of military officers, selling petrol along the road!!!

    repondre message

    • 18 December 2015 10:51, by Bazinguaboy

      You’re point on. And we have been buying the dollar at 18.5 SS, after all.

      repondre message

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