By William Madouk
The newly appointed minister of finance and economic planning, Bak Barnaba Chol, mooted a plan to de-dollarize the country’s economy, in a bid to boost the local currency and tame rising consumer inflation.
According to Bak, South Sudanese have embarked on use of US dollars in their commercial transaction, signing contract and financial dealings in the country, which exacerbate soaring inflation and exchange rates.
“We have dollarized our economy in the way that I don’t know, for instance you have house in Gudele, Munuki or a shop in Juba Market or Hai Thoura and you say my house is for $10,000 US dollar and my shop $500 US dollars,” Bak said.
“You are forcing the tenant to go look for dollars so that he can pay you, now who is the problem. We are the problem! It is not minister of finance or central bank, we should not dollarize our economy,” he added.
De-dollarization refers to the shift away from the United States dollar as the global reserve currency.
To tame de-dollarization, Bak stated that he would introduce modalities that would prefer use of local currency including other currencies to ease high demand on hard currency.
“We are going to introduce policies that will discourage people from looking for dollars. If you are going to Kampala, for instance, we will give you Shillings because you don’t need dollars to go to Kampala,” he noted.
Mr. Bak further said, he would seek consent to increase tariff on luxury vehicles like V8 that consume fuel and huge budget from government coffer.
“We are also going to discourage people from buying luxury cars V8, V6…. because these expensive commodities are costly to our economy,” he emphasized.
“V8 is good, but it’s very expensive to our budget and that is why we are going to increase tariff on luxury goods and commodities,” he added” because we want to bring food to our people facing hunger and not to increase V8 and V6 for those who to live lavishly.”
In January 2023, the central bank of South Sudan declared South Sudanese Pound as the only legal tender for commercial transaction, signing contract and financial dealings in the country.
In a circular dated January 17, 2023, issued by the Governor of Bank of South Sudan, Johnny Ohisa banned private and public institutions within the country’ s territory from using any currency than pound.
Central Bank said the decision come after they noticed that some of government, financial entities, NGOs, civil societies and other entities are using foreign currency rather than pound that has lawful standing as banknotes in the country.
Similarly, in February 2023, resident and non-resident in South Sudan were advised not to carry-cash exceeding five thousand South Sudanese Pound (SSP5, 000) and two coins aboard, Bank of South Sudan said.
In a circular seen by this outlet, the BoSS tighten carrying cash for travelers as a move to regulate South Sudan Banknote as per Anti-money laundering and counter Terrorist Financing Act, 2012.