South Sudan Finance Minister: Will Borrow to Cover Lost Oil Revenue
January 11, [JUBA, South Sudan]—South Sudan’s government will have to borrow heavily to compensate for oil revenue lost during ongoing fighting, the finance minister of this resource-rich but impoverished African country said on Saturday.
“I will be searching the whole world for loans and I’ll take the loans that are good for South Sudan from any source,” Finance Minister Agrey Tisa Sabuni said in an interview at his offices here in the capital.
Mr. Sabuni said he’s not sure how much he will need to shore up South Sudan’s $3 billion annual budget. New loans would come on top of the balance of about $1.6 billion the government borrowed last year from oil companies operating in the country to cover the fiscal year that runs through June.
Those loans sheltered the government from revenue lost to a dispute with Sudan that caused South Sudan to stop oil production in 2012 for 15 months. Production was still ramping up to capacity when a power struggle between President Salva Kiir and former vice president Riek Machar sparked turmoil throughout the country in December.
“Just as we were getting our feet, the coup makers come and mess things up.” Mr. Sabuni said. Mr. Kiir and his supporters say Mr. Machar tried to overthrow him. Mr. Machar’s supporters say they were framed by the military.
Mr. Machar fled the capital and marshaled rebel forces to his cause. Subsequent fighting has killed thousands of people and sent more than 250,000 fleeing from their homes, according to the United Nations.
Negotiators for Messrs. Machar and Kiir are negotiating the terms of a cease fire in Ethiopia. Mr. Machar’s backers on Friday said they would drop a demand that 11 of their supporters imprisoned in Juba by Mr. Kiir’s government be released before the fighting could end.
So far the fighting has disrupted at least a fifth of South Sudan’s 240,000-barrel-a-day oil output, Mr. Sabuni said. South Sudan is sub-Saharan Africa’s No. 3 producer behind Angola and Nigeria.
“The economic impact of the current crisis is definitely quite enormous and very pervasive,” he said.
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