Six more months of austerity: Finance Minister 08/01/13
Interviews >>> At secession in July 2011, South Sudan took along about 75 percent of the crude oil Sudan was exporting, but it still needed the infrastructure in the north to export the commodity. Due to sustained quarrels over oil transit fees and alleged diversion of her entitlements, South Sudan shut down oil production in January last year. To fill the gap created by the loss of oil revenues, which accounted for 98 percent of her budgetary obligations, South Sudan adopted austerity measures that reduced the annual spending from more than 8 billion to 6.5 billion pounds. The measures include tight financial spending and reduction of trips abroad. Although Finance Minister Kosti Manibe says the austerity did not come to stay, he maintains that the measures would still last until June, and sometime beyond. "Many of the austerity measures that we have put in place are actually just good financial management and those will remain. They will continue even if we go back to the normal budget," Manibe said. Radio Miraya: How are you tackling the austerity measures since the oil shutdown is still on and the cooperation agreements with Sudan have not taken phase? Kosti Manibe: Well, we have managed so far to keep the value of South Sudan Pound from depreciating massively. From the time oil was shut down, the rate in the parallel market was around 3.5. It rose up to about 5.0. over the last three months; it has appreciated and now stands at around 4.2. That, in my view, is a sign of good performance of the economy. The rate of inflation has also been largely controlled. It has not increased. It has declined. And it is our hope that over the next two years we should be able to reduce to more less one digit level from the higher it is now. That shows a very stable state of the economy. We of course hope that oil flow will be resumed and if it is not resumed, we will have some ways of raising finances so as to increase the level of budget from the present 6.6 billion to the original 8 to 9 billion pounds. Radio Miraya: What have you prioritized in all this economic cycle? Kosti Manibe: It is simple. First is infrastructure. Then, of course, going with infrastructure and that is of all types: you have roads, you have electricity system, and then we need to increase the productive areas like agriculture, which is also one of the key areas of growing the size of the economy. And you need some investment in human capital; in education and health because that is what will service you tomorrow. Radio Miraya: People are concerned when salaries are delayed. What is the problem that delays salaries every month? Kosti Manibe: We have been paying salaries regularly, even throughout the austerity budget period, beginning from April this year up to June. In July in the new fiscal year, we have had one month delay in payment of salaries. As you probably know, the budget for this fiscal year was passed only at the end of July, one month late. And that delay also meant delay in salaries because after passing the budget, you have to pay July salaries more less the end of August. Radio Miraya: When is the end of austerity measures? Kosti Manibe: Austerity measures are going to continue with us for a while. I hope that at some point, we will still resume the flow of oil. But even if that happens, much of austerity measures that are in place will continue up to the end of the fiscal year, which is up to 30th of June. From the next fiscal year, I hope the austerity measures, as we have seen now, will not be there. We will go back to the normal circle of the budget. But remember that many of the austerity measures that we have put in place are actually just good financial management and those will remain. They will continue even if we go back to the normal budget. -- You received this message because you are subscribed to the Google Groups "South Sudan Info - The Kob" group. To post to this group, send email to [email protected]. To unsubscribe from this group, send email to [email protected]. For more options, visit https://groups.google.com/groups/opt_out.
