Economic Crisis in South Sudan
South Sudan is currently facing a severe economic crisis characterized by escalating inflation, with the US dollar rising against the South Sudanese pound (SSP). This has led to a significant increase in the prices of essential goods, putting a strain on household budgets.
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The prices of basic commodities such as maize flour, beans, and cooking oil have skyrocketed. A 50kg bag of maize flour now costs 40,000 SSP, up from 34,000 SSP, while a 50kg sack of beans costs 60,000 SSP, up from 50,000 SSP. The price of a 20-liter jerry can of cooking oil has also increased from 45,000 SSP to 50,000 SSP.
Impact on Households
The steady increase in commodity prices has greatly impacted households, which have limited income sources. Consumers are being forced to cut back on meat consumption and opt for alternative options such as fish. For example, a kilogram of goat meat or mutton now sells at 10,000 SSP, up from 8,000 SSP, while beef costs 9,000 SSP.
Economic Instability
Economist Abraham Matoch has criticized the government institutions, including the finance ministry, central bank, and trade ministry, for failing to control the market and promote domestic production. He also blames black market dollar speculators for manipulating the market and calls for stricter regulations. Matoch emphasizes the importance of having a fixed market economy, given that South Sudan is primarily an importing country.
Past Economic Stability
Matoch recalls the 2011-2014 period when the dollar was fixed at 2.91 SSP, and commodity prices were stable. He urges the government to intervene, regulate the market, and crack down on black market activities to restore economic stability.
Government Intervention
Last year, the national ministry of finance, in collaboration with the Central bank, promised to offer credit loans to domestic traders to boost economic recovery. However, this move has yet to yield results. The government also promised to offer cash discounts to commercial banks and clients over deposits, as well as vowed to end street money exchangers who are seen as a threat to the economy.
Conclusion
The economic crisis in South Sudan requires urgent attention and action from the government. The rising inflation and escalating commodity prices are having a devastating impact on households, and it is essential to regulate the market and promote domestic production to restore economic stability. The government must take drastic measures to control the black market and promote a fixed market economy to ensure the country’s economic growth and development.
