Analysis of South Sudan past economic and finance.
By Hearty Ritti
Transitioning from dependency to independent nation, the Republic of South Sudan (RSS) had struggled and experienced a significant unpredictable and challenged economic and financial management turmoil including its private sectors since 2005.Officials concluded that this was due to the fact that, the GOSS/RSS’s interim period appeared to be relatively mix of unstructured and weak frame work measures in place which mitigated financial irregularity and practices.
Officials also stated and indicated that by then the system lucks transparency in which the public access to the nation’s financial data was limited and in-accurate. The structure was said to lucking improved budget structure, financial management mechanism, and accountability to complement proposed budget. Weakness had deepened through institutional and capacity development which failed to recognize efforts of collaborative country development initiatives from technocrats. Human capital was evident set back that slow South Sudan attaining its potentials officials reported.
The record also saw that the system did not paying any close attention as to how external and internal landing disbursement or investment to ensure positive contribution to equitable and sustainable development. Most importantly the system did not acquire financial instrument or soft ware to prevent unauthorized from manipulating the system for their advantages.
At this point, South Sudan is said to have the cleanest domestic and international debt record compared to the rest of any country in the world. The only debt reported on South Sudan had been the one inherited form old Sudan; this is good news we could capitalize on. Sincerely speaking, we must do everything now at our disposal to save south Sudan from being buried in debt like other African Nations before it is too late.
Seriously speaking, with inflation above 60%, south Sudan is facing the daunting tasks of transforming from dependency to a fully sovereign state; however it is challenged by the extreme dependence on oil revenue, where 98 percent of (RSS) public/government budget came from oil. Economist and financial analyst experts have projected and predicted that the dependence on oil revenue will only last for short-term and has no long term constrain. These are indications that should alert RSS to adjust its dependency on oil and redeploy focus on exploring different sources of revenues to meet its national budget demands in long run.
This lead us to ask the question that when will south Sudan stand on its own feet and develop country system to contribute significantly to development and bring aboard diversity to the natural development with ultimate hope and objective to transform and develop support for sustainable and measurable results? To-do that, RSS should enact tough rules for responsible financial cash flow where legal framework and enforcement mechanism is in line with what president Kirr called zero tolerance for corruption in any operation being internal, external, or foreign investment.
It is important to note that RSS private capital flows will not deliver for the country’s poor if ambitious regulatory measures to promote responsible finance, transparent and accountability are not urgently executed. Tentatively, in the absence of a fair and binding frame work for responsible finance, where billions are borrowed and un-documented/accounted for, RSS will face repayment difficulties if the borrowed loans or disputes with foreign investors are not transparently documented. The implication of financial crisis will leave lasting scars on the RSS financial system and will have protracted marks on poor people across south Sudan , some thing we must all prevent from happening.
Similarly, the fact that financial prediction is based on the speculation, as RSS economy hopefully rebounds, political leaders will tend to bid on fair and binding frame work for responsible finance negotiated by the other party; however, the bottom line is that someone will be held responsible when citizen suffer, complain, or protest.
With this in mind, I thought of dropping observations, recommendations and suggestions that might interest Key GOSS economic and financial decision makers to forge model to prevent inflation from skyrocketing, say no to heavy browed loans, and apprehend corrupt on time.
A) Urgently, South Sudan needs to develop a charter outlining standards to ensure government landing and investment rules and regulations to better monitor actively financial activities to deliver positive development outcome. The importances of developing responsible finance instrument framework for a decent accountable and equitable manner are essential.
B) Urgently enact law that can expedite corruption allegations to the court of law for persecution through fair and balanced investigations.
C) Public access to national budget information and financial data to improve accountability and help link citizen to development plan, implementation and results.
D) The fact that South Sudan does not yet acquired high tech financial soft ware to track its financial activities and cash flows, I recommend it should only accept grants from an external sources of borrowed finance and should not borrow excess foreign securities which are indirectly attached to the heavy loan that will eventually cause budget deficit, excess spending over income and decline on economic growth and possible inflation.
E) RSS should develop principal proposal for practice. The current inflation is direct result of excess borrowed external finance corresponding to failed development projects, while exporting zero commodities to the foreign market with exception of oil revenue; causing risk and uncertainty for the new country economic growth.
F) To reduce hyper inflation, RSS needs to renew search for financial returns , meaning that there is currently an increase in short term and volatile private capital flows without frame work of binding standards for sovereign RSS, implying that borrowing, lending, and investment practice are left un-check.
G) It is advisable that RSS needs to propose a contractual change to avoid unwanted debts/loans and encourage responsible financing as its investment contract to ensure decent investment and help improve the quality of lending and investment that eliminates future illegitimate and unsustainable debt on RSS’s future.
H) RSS should capitalize on its experienced and professional human capital technocrats to create balanced experienced equivalent to that of the western free market economy to allow competitive business environment. RSS nationals with certified Public Accountant (CPA, IMF, World Bank, UN, Wall Street etc) are typical asset that could reverse and redirect expectations, in my view worth investing. e.t.c.
I) Diaspora being the seven (7Th) fronts during the war should consider voluntarily or organized repatriation to south Sudan. Let us go to South Sudan and make difference and impact. Let us use our diverse expertise to make Republic of South Sudan the best nation on earth.
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