Economic Meltdown, not Riek Machar, is the Number One Rebel for the Government in Juba
South Sudan’s Hyper-Economics Situation is The Government Number One Rebel, Unless Given the Remedy
Marial Mabor Turic, Juba, South Sudan
March 16, 2016 (SSB) — First and foremost, my dear readers, let me draw your attention to the simplex definition of an economy, “late 15th century (in the sense, ‘means management of material resources’): from French économie, or via Latin from Greek oikonomia ‘household management’, based on oikos ‘house’ + nemein ‘manage” This is the state of a country or a region in terms of production and consumption of goods, services and the supply of money.
Reference to the above definition, economists have tried to use different vocabularies like, “Prudence, providence, thriftiness, frugality, Saving, Scrimping, Canniness, Careful, Good management, Good husbandry and economizing among others, as they push to make the word “economy” more logical, clearer and understandable to many scholars, researchers and managers.
South Sudan, is like any other nation in comparability as far as economics decisions and policies are made. However, my dear readers, let me at least bring to your attention some of the aggregate samples that I would be touching in the next paragraphs. What is inflation? What kind of inflation is south Sudan undergoing? Who are/is responsible for managing our economy? Is there such a thing as too much money? Maybe. What happens when inflation is excessive? What are the causes/courses of this hyper-economics situation in the country?
Without stratification, south Sudan’s economy is at the alarming stage, even a layman could definitely admits and confesses that the economy is at the brim of collapse. To begin with, in any nation/country, there are two principal parties charge with responsibilities to make policies and plans, regarding how an economy could be run; this is definitely the ministry of finance, commerce and economic planning and most importantly the central bank, they are the prime agents entrusted to manage the economy. Top on the list, things to do with floating exchange rate and furthering devaluation of pounds are not only the prime economics miscalculation made by the government, but also interfering with what has been running on its own since the inception of this country, we are the open market operation economy. Our economy had never been managed, but instead pulled down by unaccountable authorities, corrupts individuals, poor infrastructure, insecurity and uncontrollable expenditures by government. What do you expect? The velocity of money is unknown!
In south Sudan, I have learned and experienced that everything is taken as political or opposing. Even to the point of death! Of course, the economy is on a sick bed. What do you expect when a common man like me cried out loud that our economy is being mismanaged and misappropriated? Of course the usual business, “You are a rebel” and if so, how many rebels will our offices-sitting muzees and grandfathers have as our cost of living increase to deteriorate day by day?
As I stated earlier, our economy is being brought down by many economics miscalculations especially by our politically appointed sitting officials. The central bank, ministry of finance and economics planning and the government as a whole, have failed in totality in bringing this alarming hyper economics condition into normalcy. Of course, I called it hyper because the rate at which the official currency is being devalued day by day is abnormal, under the watch of these so called people in authority.
In economics history, During the 1970s, great concern arose in the United States about inflation, which surpassed 10% per year. At that time, President Gerald Ford referred to the inflation threat as ‘public enemy number one.’ A 10% inflation rate sounds pretty bad. However, compared to other time periods and what had happened in other countries, this level of inflation is not extreme, but people were very concerned. To show you why, let’s look at some examples from history where inflation was extremely high, find out how economists describe this situation and then learn how it affects the economy.
After the First World War, Germany experienced a rapid rise in prices at a rate exceeding – listen to this – 855 million percent per year! Even as recently as 2008, Zimbabwe experienced an inflation rate of 231 million percent that year! Wow. South Sudan hasn’t yet reach this stage. I’m sure the first thing that came to mind when you read the word ‘hyperinflation’ was a giant balloon shaped like a lawn gnome being overinflated, then suddenly bursting. I thought of this myself. That’s not what hyperinflation means in this contact, although it might be cool to watch.
However, briefly, hyperinflation is a rise in prices exceeding 50% per month. Just think about that for a second. At this rate, if you bought a candy bar that cost you 10SSP at the beginning of the year, guess what? That same candy bar would cost you 130SSP by the end of the year! How would that make you feel, and what kinds of things would happen if prices would go up that fast in a period undefined in this country?
The effect of hyperinflation is that a country’s currency can quickly lose most of its value until it becomes nearly worthless. Do we have to wait for this time? During a hyperinflation, strange things can happen. For example, in Germany, people routinely used cash as firewood and as toys for the kids, while (believe it or not) in Zimbabwe, they used it as toilet paper.
Hyperinflation is a cycle that feeds on itself. Once it starts, it’s very difficult to stop, and prices tend to double very quickly. In some countries, during hyperinflation, when people went out to eat at a restaurant, the price of their meal doubled even before they finished eating. I guess it’s better to read the menu while you’re standing outside and pay the bill as soon as you sit down.
My dear readers, south Sudan needs both political and technical reforms by the current sitting government, either, will to be transitional government or before. The inflation and money supply chain management has been running undetermined over the years. Therefore, for us to be on the safer side, before being caught in hyper-economics situation, we need a political will, to overcome these challenges facing our economy. To save this economy, peace should be a priority at this juncture, appointing competent technical people in the two principal institutions of central bank, ministry of finance and economics planning, diversifying and restructuring other vital sectors, must be the ultimate choices in saving south Sudan crippling economy.
Marial Mabor Turic: The Writer is a commentator based in Juba South Sudan; Reachable on maialmabor@gmail.com
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