In an effort to stabilize its rapidly depreciating currency, South Sudan has initiated a crackdown on forex dealers in the capital city of Juba. The Governor of the Bank of South Sudan, James Alic Garang, announced that individuals found carrying large quantities of foreign currency without a valid reason would be questioned by law enforcement officials. Those selling dollars without a proper license, whether on the streets, in their homes, or in shops, will also face scrutiny. However, Garang clarified that individuals holding a valid license to deal in foreign exchange are not targeted by these measures.
The South Sudanese pound has officially weakened significantly against the US dollar, with the rate reaching about 1,600 to 1,000 in the first quarter. On the parallel market, the exchange rate is even higher, nearing 2,300 to the dollar. This depreciation has led to a surge in the prices of basic goods, causing financial strain on citizens and the government alike. With limited revenue, the government is struggling to pay civil servants and maintain regular operations.
Governor Garang recently traveled to a foreign location to secure additional resources for South Sudan. While details of this arrangement remain undisclosed, Garang mentioned that the funds would be utilized for salary payments and to help stabilize the currency market. The country’s reliance on oil exports has also been challenged by external factors, including disruptions caused by the Red Sea shipping crisis and attacks on Sudan’s primary oil refinery.
The recent rupture of a crucial oil pipeline in neighboring Sudan has further exacerbated South Sudan’s financial woes. This pipeline, vital for exporting crude oil, experienced a significant decrease in revenue for the state, as explained by the country’s finance minister. Governor Garang acknowledged the challenging external circumstances facing South Sudan but remained optimistic about the country's ability to navigate through these turbulent times.