JUBA, (The Southern African Times) – South Sudan on Tuesday secured 334 million U.S. dollars from the International Monetary Fund (IMF) to support economic reforms in the country.
Dier Tong Ngor, governor of the Bank of South Sudan, the central bank, said the new cash injection will boost the country’s foreign exchange reserves and also offset the economic shocks caused by the COVID-19 pandemic.
“The new resources have come when South Sudan is implementing essential economic reforms, including monetary and far-reaching foreign exchange market reforms, which involved refraining from monetary financing of the deficit,” Ngor said in a statement issued in Juba, capital of South Sudan, stressing the utilization of the new resources will address the budget support and the economic impacts of the COVID-19 pandemic, the balance of payment, and reserves building.
The central bank’s current economic stabilization efforts have been supported by the significant recovery of oil prices and the two IMF disbursements under the Rapid Credit Facility in November 2020 and March 2021 for a combined financing of 225 million dollars, said Ngor.
“These efforts have made a positive impact by helping the country address the pandemic’s adverse effects, the exchange rate stabilization, declining inflation, and the government’s ability to reduce salary arrears substantially,” he added.
The IMF allocation coupled with the improving oil revenue collection will substantially boost the country’s foreign exchange reserves, said Ngor. “The increase in reserves will help build external resilience and sustain the current reforms in the foreign exchange market.”
South Sudan, which depends 98 percent on oil revenue to finance its fiscal expenditure, has been struggling to stabilize its economy amid hyperinflation caused by years of conflict since 2013.