Jan 17, 2017(Nyamilepedia) —— South Sudan’s incumbent president, Salva Kiir, who is struggling to maintain status quo in his country is wondering why the South Sudanese Pound(SSP), one of the strongest currency in the world, has lost its value in less than 3 years.
Three years ago, the South Sudanese Pound was traded at 3.29 SSP against one US Dollar but 1 US Dollar today is traded at 103 SSP in the parallel market and 87 SSP in the central bank.
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President Kiir, who convened a meeting with his new Central Bank Governor, his deputy, Minister of Finance and his Deputy today wonders if the devaluation of the currency could be reversed.
“What is it that made us lose the value of our money? Is it something that can be corrected, can it not be corrected?” Kiir questions.
Kiir, a military general with very limited academic background, believes that the economy could be collapsing because many South Sudanese are longer interested in investing in their own country.
He is right, there is war at every corner of South Sudan. More than 2.8 million displaced and hundred of thousands living in unproductive IDPs camps in the country.
Although President Kiir, who owns a home in Kenya is not an exception, he believes that people come to collect money and run away to East Africa to spend it.
“Most South Sudanese have decided to reside out of the country; they just come here to get some dollars and go.” Kiir said.
“One of them is that, our people took their money out of the country, and money taken out of the country does not benefit us.” Kiir continued.
Due to the conflict in the country, many public servants are paid less than $200 USD as Kiir’s government invests over 75% of the national budget in a war which continues to escalate. To make it worse, some oil fields are also shut down by the conflict.
Although the government tried to prevent people from leaving Juba from July this year, President Kiir is aware of insecurity in the country and he says he cannot force people to live where they feel insecure.
“That will never make us grow. But we cannot force people to remain in South Sudan, when we are not sure about the security.” Kiir continues.
“Foreigners who are working here, including the NGOs, have decided to bank outside South Sudan, and they just bring salaries for their employees.” Kiir continues.
“Local employees have decided to pay them in local currency, and they pay their international [staff] in hard currency. That is very unfair.” The President complaints.
Troubled, president Kiir admits that he is not an economist but he pleas that something must be done to restore South Sudan economy.
“I’m not an economist, but I think it has an effect on the country’s economy.” Kiir stresses.
According to latest Economics reports, South Sudan inflation has hit its highest ever at 835% as its currency continues to depreciate.
Before July 2016, there was hope that South Sudan economy could stabilizes as peace was expected to return to the country but with resumption of war in July the economy has continued to worsen.
Whether the new changes in financial institutions could restore South Sudan economy remains to be seen.