South Sudan has run out of foreign exchange reserves and cannot stop the pound’s depreciation, a senior central bank official said Wednesday.
Daniel Kech Pouch, the bank’s second deputy governor, told reporters in Juba that the local currency was depreciating sharply and there was little that the bank could do to stop its fall.
“It’s difficult for us now at this moment to stop this rapid exchange rate (decline) because we don’t have the reserves for us to intervene in the market,” said Pouch.
The senior central bank official said the country’s oil revenues had dropped sharply, hitting its foreign exchange reserves.
“We don’t have other resources at the moment to complement. Even the non-oil revenue that is being collected by the government does not generate much money to be injected in the market, and we don’t have our own,” he said.
South Sudan is almost entirely dependent on crude oil revenue, but current output, at about 180,000 barrels per day (bpd), has plummeted from a peak of 250,000 bpd before the outbreak of civil war in 2013, according to official figures.
According to Puoch, there are three rates for the South Sudanese pound: the central bank rate at around 165 to the US dollar, the commercial bank rate at 190 and the parallel market rate at 400.
Pouch said the central bank leadership was holding meetings with officials from the World Bank to discuss other means of borrowing.
South Sudan is emerging from a six-year civil war that killed an estimated 400,000 people and created Africa’s biggest refugee crisis.
Source: Radio Tamazuj