S. Sudan’s Central Bank declines to handle letters of credit
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June 11, 2015 (JUBA) – The governor of South Sudan’s Central Bank,
Kornelio Koriom, has advised the country’s lawmakers against returning
the management of letters of credit under the bank’s authority, saying
the beneficiaries threaten to “kill” if not awarded.
JPEG - 53.1 kb
Kornelio Koriom, South Sudan’s Central Bank Governor addresses
journalists in Juba, 11 September 2012 (ST)
Appearing before members of the National Assembly, Koriom said the
letters of credit, which are meant to enable traders access United
States dollars from commercial banks to enable it import basic items
such as food, fuel and medicines caused problems to the Central Bank
before it was transferred to the finance ministry in 2012.
“Everybody who has never gone out of this country wants the LCs [the
letters of credit] and want to be an importer,” the governor told
lawmakers on Tuesday.
“But not every trader can be an importer. Even he who doesn’t know the
A, B, C of the foreign trade will almost kill you if you say no. So it
is not an easy thing,” he added.
A parliamentary investigation presented to the country’s lawmakers
showed discrepancies in awarding the much-sought letters of to
business people and government institutions, totaling over $600
million between April 2014 to April 2015.
Goc Makuac Mayol, the parliamentary specialized committee of finance,
who tabled the report to legislators, said the ministries of trade,
finance, health, petroleum and agriculture were the main
beneficiaries. Petroleum and trade ministries took forty per cent each
and twenty per cent is distributed between the other ministries.
Mayol said the parliamentary findings unearthed several controversies
and lack of supervision from the ministries of trade and finance on
traders awarded LCs to import goods from neighboring countries.
“The [parliamentary committees noted that the origin of the problem of
the LCs is rooted in the absence of the single reporting authority
which means that no joint report and assessment was made on who
received the LC and who do not,” said Mayol.
State governments are also entitled to letters of credit to enable
their traders import goods.
For instance, Central, Western and Eastern Equatoria states each are
reported to have received $3million. The country’s other states like
Lakes got $3 million while Warrap took $1.9 million. Northern Bahr-el
Ghazal state reportedly obtained $2million with Unity State taking
$15millions, Jonglei taking $5millions and Upper Nile being allicated
$10millions.
There are records for Western Bahr-el Ghazal, according to MPs report.
More than 100 companies from the states are allegedly awarded those
LCs but good were never delivered, leaving market shelves empty and
prices skyrocketing nationwide, MPs said.
The five committees tasked to investigate the issuance of LCs
recommended that the management be returned to Central Bank from the
ministry of finance.
Several lawmakers said the audit by South Sudan’s anti-graft body, the
Audit Chamber, should be launched immediately and report return to
parliament within 60 days.
Koriom said return the LCs to his authority would make success only if
the number of companies and individuals seeking U.S dollars is reduced
to very few people.
“The rest of people (traders) can take (buy goods) from here, if
things are brought to Juba and take to wherever (part of the country)
they want,” he said.
He also revealed that foreign traders “are moving out their capital.
When they are moving out their capital and we shall never see those
dollars.”
“It is a loss and that is what is called capital flight,” he said.
MPs launched an investigation last month following a motion moved by a
lawmaker regarding the surging of prices in the market across the
country. Traders said at the time said hard currencies were lacking as
the ones in black market were expensive.
(ST)
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12 June 07:11, by Ahmed Chol
This country will never get up on the group given this system. Why
don’t we think of ways of manufacturing goods instead of importing for
the whole of our life time on earth? Foolish indeed.
repondre message
12 June 09:13, by Ayuen deng
Letter of Credit is wide window of corruption in South Sudan i
think it should be close to avoid further damage to our country and
the government to agree with Sudan,Ethiopia,Kenya,Uganda and the rest
of the world to bring life saving goods to sell them in Pounds to our
traders and they will be the one to be buying the Dollar from central
bank only.
repondre message
12 June 07:14, by Mi diit
"For instance, Central, Western and Eastern Equatoria states each
are reported to have received $3million. The country’s other states
like Lakes got $3 million while Warrap took $1.9 million. Northern
Bahr-el Ghazal state reportedly obtained $2million with Unity State
taking $15millions, Jonglei taking $5millions and Upper Nile being
allicated $10millions."
repondre message
12 June 07:16, by Mi diit
That above break down in distribution of benefits will clearly
tell you that it was not about trade but about politics and war.
States of Upper Nile region for the first time got the lion’s share,
if that is true, and this is to buy hearts of those politicians and
generals to support the government in the war against Riek Machar’s
democracy.
repondre message
12 June 07:18, by Mi diit
Before the war it was Bahr el Ghazal region that always
got the lion’s share in corruption, whether by contracts, Letters of
Credit (LCs) or Dura Saga.
But now the calculation has changed to buying support from
the Upper Nile region’s politicians and army generals who use the LCs
to get access to foreign currency (dollars) and put in their foreign
bank accounts abroad.
repondre message
12 June 07:21, by Mi diit
What always happens in the Central Bank or ministry of
finance is not promotion of trade, but promotion of corruption for
self-enrichment. The beneficiaries strike deals with officials who
give them LCs so that the acquired dollar currency is divided and
resold in the black market. That is what that business is all about.
It is not about import as lied for by the governor of Central Bank,
Koriom.
repondre message
12 June 10:26, by Lango2010
Midit
you may be right at a wrong time, what we
discussing here is corruption, and corruption is an enemy of
everybody, and here in South Sudan everyone is corrupt only God knows.
those who rebel were among the list of 75 Officials with 4 billions
Dollars of innocent South Sudanese, others are still in government
today; every tribes is involves no doubt.
repondre message
12 June 11:05, by Lango2010
no one is worthy in this nation, and because
of that we paying for the prices of our inequity. wrath of God is upon
us all, i only carry for the innocent one. but let the makers faced it
to the end.
repondre message
12 June 11:14, by Lango2010
No where in this planet is body displayed
in the market like and other necessity goods but in South Sudan. if
there are no dollars in the hand respected traders where do this
illiterate people get their dollars always, this so that the level of
corruption is rooted in the heart of Southerners, those who talk
against it are the one practicing it. what the law makers doing?
repondre message
12 June 07:34, by Kerem
Lakes State has seen that money in the government stores where
food is stored but the challenge is still there. Common woman or man
who live below poverty line cannot access the food but you see
government vehicles coming and loading hundreds of bags. A common
person take more than a week to get 50kgs bag of flour
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