Why Prices are still High after the fall of dollar in the South Sudan’s Exchange Market
By Kuir Mayen Kuir, Nairobi, Kenya
Saturday, October 17, 2020 (PW) — The main goal, objective, of starting a business is to make profits. In order to make these profits, one has to be belligerent in doing all it is required of him or her to meet this set target. This include suppressing or minimizing all the activities leading to the incurrence of losses.
This is something that any business minded consumer will have to understand. In some instances, the entrepreneur will be required to make tough indiscriminative decisions that do not bear the interests of their clients just to prioritize the main goal of starting a business.
This is normal and any reasonable consumer can understand this reality without so much persuasion. On the other hand, it is totally unethical and indiscipline when these merchants take advantage of the situation and skyrocket the prices of their merchandise, commodities, for their selfish gains.
These merchants will have to be subjected to legal regulations which should define their limits and spell out the rights of consumers in the event such incidences happen to them. This happens everywhere and South Sudan is not excluded.
In the last one to two weeks, the dollarization in South Sudan has been of great concern. It has literally added up to the sufferings and estrangements of our vulnerable population. Prices of goods and services have been escalating high on a daily basis. The dollar has been overrunning our South Sudanese Pound (SSP) with an alarming rate in the black market.
This was drastically brought to a reasonable and affordable rate the other day when the president of the republic of South Sudan, H.E Salva Kiir Mayardit coughed facing the black-market (we pray the cough becomes persistent).
This signal of progress was welcome jovially by the citizenry with the thought that the high prices of goods and services in the country are going to hastily come down the dollar way. This expectation was met by the stagnation of prices. This is why some citizens want the president to cough again but this time facing the traders in the goods market.
This is where my purpose of writing this piece will be served. I will emphasis my points where necessary. Normally the market is control by the natural forces of demand and supply. This means the prices in the market are forced to be listening particularly to this voice.
In as much as the traders would always want to deliberately hike prices of goods and services, the forces of demand and supply in conjunction with positive competition will always have a greater influence herein. This should explain why prices cannot come down the dollar way in the case of our country, South Sudan.
Another thing that those who are asking the president to exert pressure on the traders to reduce prices of goods and services should know, is that the president cannot run the traders at a loss deliberately. Otherwise they can succumb to the government pressure for now and their businesses close tomorrow simply because of losses.
Empirically, these traders are still selling the stock they purchased before the dollar rate was forced to reduce. By the fact that they used the selling prices then, it should be obvious that they cannot sell at a lower price than what they were supposed to because they will run at a loss. This is reasonable enough. Let them make their sales for now because we also need them and their businesses tomorrow.
If the citizens really want their government to help them meet their basic needs, then instead of asking the government to reduce prices for now, they should ask their government to subsidies the next stocks for their advantage. So that the prices for the next stocks will be reasonable enough.
In conclusion, it is prudent to just appreciate the government for her tireless efforts and stop the culture of making the government do the impossible. That government is also the government for the traders too, not only the consumers.
Therefore, the obligation to protect the interests of the traders is also her responsibility because these are very important components of our economy and without them, we can barely realize our economy goals and objectives.
The author is a student of economics and statistics at the University of Nairobi. He can be reached via his email mayenkuir@gmail.com or on twitter @Kuir Mayen Kuir.
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