For Immediate Release
REF: SOUTH SUDAN RECEIVES USD 334 MILLION FROM THE IMF
South Sudan has been allocated USD 334 Million by the International Monetary Fund (IMF) as part of the general allocation of Special Drawing Rights (SDRs), approved by the IMF Board of Directors on 2nd August 2021. The allocation became effective yesterday Monday 23’d August 2021.
The new resources have come when South Sudan is implementing essential economic reforms, including monetary and far-reaching foreign exchange market reforms, which involved refraining from monetary financing of the deficit.
Utilization of the new resources will address the budget support and the economic impacts of the COVID-19 pandemic, the balance of payment, and reserves building.
Our current economic stabilization efforts have been supported by the significant recovery of oil prices and the two IMF disbursements under the Rapid Credit Facility in November 2020 and March 2021 for combined financing of US$225 million.
These efforts have made a positive impact by helping the country address the pandemic’s adverse effects, the exchange rate stabilization, declining inflation, and the government’s ability to reduce salary arrears substantially.
Commenting on this new development, the Governor of Bank of South Sudan, Hon. Dier Tong Ngor, stated that “the additional USD 334 million allocations by the IMF and the improving oil revenue will substantially boost the country’s foreign exchange reserves”. He further stressed that “the increase in reserves will help build external resilience and sustain the current reforms in the foreign exchange market. Building reserves, in turn, is expected to facilitate price stability and investment
flows going forward. It will also improve liquidity and gain enough policy space to battle the pandemic while mounting an inclusive recovery. As such, the allocation will contribute to the sustainability of the current economic and foreign exchange reforms”.
The Governor also reiterated commitment to utilizing these resources prudently and transparently. He confirmed that “the Ministry of Finance & Planning and the Bank of South Sudan will ensure adequate checks and balances and will provide special accounting and reporting on the utilization of the proceeds will be undertaken”. “We also remain committed to continuing on the path of economic reforms and that the budget currently, which has been passed by the Cabinet and will be soon sent to Parliament for approval, is based on realistic revenue projections and maintains the commitment of no monetary financing of the deficit” he concluded.
The Governor also confirmed “commitment to transparency, good governance, and accountability in the use and reporting of South Sudan’s SDR allocation”. Contacts with the IMF will continue to discuss the optimal use of the SDR allocation, including building international reserves and supporting our economic reforms and FX stabilization”.
Hon. Dier Tong Ngor
Bank of South Sudan
By Hon. Dier Tong Ngor, Governor of the Bank of South Sudan
Policy Reforms and the Disbursement of US $ 174.2 Million by the IMF
The Bank of South Sudan (BSS) re-introduced Foreign Exchange Auctions on the backdrop of the rapid depreciation of the South Sudanese Pound (SSP) and high inflation. This monetary policy tool –among other policy instrument implementations- has proven success in the past while addressing the economic shocks brought about by low international oil prices and other externalities beyond our control, which led to considerable fiscal imbalances and constrained financial system performance.
In light of the above, the article published by the Juba Monitor on the 20th of January, 2021, is extremely misleading and lacks the undertaking of the objectives of why the Bank of South Sudan engages in Foreign Exchange Auctions.
The objective of this tightened monetary policy stance is to withdraw the excess liquidity from the market, and in return harmonise the difference in exchange rates, while stabilising market prices. Therefore, the impression carried by some Forex Bureaus that the FX Auctions are intended for maximising the profits of Forex Bureaus are absolutely false.
We would like to make it clear that the current FX Auctions are only meant for forex bureaus. Commercial Banks are not participating; however, BSS still provides commercial banks with USD at the official rate to support the importation of essential commodities, including food items, fuel and medicines.
We strongly encourage media houses to contact the Bank of South Sudan in the future for any clarification on the Bank’s dealings before publishing on such sensitive matters that usually have adverse effects on the market and to avoid misleading the public.
- The Monetary Policy Committee (MPC) of the Bank of South Sudan (BOSS) met today Tuesday 3′d December 2019. The main issues discuss during the meeting covered the monetary policy for the year 2020 and the recent developments in the foreign exchange
Monetary Policy Targets for 2020
- Deliberated or the Bank’s Monetary Policy Proposals for 2020, which will be recommended to the Board of Directors for adoption, during their next meeting scheduled for the 17° December 2019. In this regard, the Monetary Policy Committee has suggested targets for 2020, which covers targeted real GDP growth for 2020; targeted inflation rate; targeted growth in money supply; and the expected Central Bank Rate (CBR).
Recent Foreign Exchange Market Developments
- The second key agenda item for the meeting was the review of the recent developments in the foreign exchange market and specifically the movement in the exchange rate and the implication this might have on This is the main reason we called for this press briefing. As we all know, the government has recently paid the outstanding salaries to government employees, which is really commendable. However, this sudden payment has its impact on the market, particularly on the exchange rate of the South Sudanese Pounds against USD and other convertible currencies.
- In effect, the Currency in Circulation (CIC) figures, as at September2019, was SSP 48.55 billion. The recent salary payment was about SSP 15 billion. This makes the new injection of cash equal to about 31% of the CIC. This sudden increase is one of the key reason putting pressure on the SSP. If left unchecked, this will lead to higher
- Because of this threat, the Monetary Policy Committee of the Bank of South Sudan, in its meeting this morning has decided to take the following measures:
- The Bank will immediately intervene in the foreign exchange Market:
i. The Bank is allocating significant amount of USD for the Importation of goods and services. This will continue or a regular basis in order to satisfy the market demand for foreign exchange.
ii. We will allocate foreign exchange to Forex Bureaus, which are licensed and compliant with the Bank’s rules and This will be organized on weakly basis, starting immediately this week.
b. The Bank will immediately introduce Term Deposit facilities, which will be available for banks to use and to help them manage access It will be remunerated at reasonable interest rate to be determined by the Bank from time to time.
c. The Bank will introduce Central Bank Bill (BOSS-Bills) to enable it conduct regular Open Market Operations.
- We are confident that we are ready to satisfy the market needs for foreign Let those speculators who want to test our determination to stabilizing the market is take note of our actions.
Dier Tong Ngor
Governor, Bank of South Sudan
Juba, South Sudan
Conclusion of the First Quarter Ordinary Meetings of Board of Directors of Bank of South Sudan, held between 2 to 4 of April 2019
The Board of Directors of the Bank of South Sudan (BSS) concluded today, April 2019, its ordinary Quarterly meetings, which have been taking place between (April 2′ d — 4th, 2019). During the three days deliberations, the Board discussed and made resolutions on several matters, covering the prevailing macroeconomic environment in the country as well as deliberations on various reports on the performance of the Bank in the year ending 2018 and also reviewed the performance in the l’t quarter of 2019. Specifically, the Board deliberated on the following important agenda:
- The Board reviewed the macroeconomic report for the year ending 2018 (4″ Quarter Report) and also took note on the prevailing global macroeconomic conditions, including the expectations and trends of international oil prices and oil production. The discussions also covered the developments in the emerging economies and the East African Region in
- In the context of the South Sudan’s macroeconomic indicators, the Board noted that South Sudan domestic outlook is starting to feature positive developments, following the signing of the peace agreement and the relative increase in oil production. Also the Board noted the steady improvement of international oil prices, which will impact positively on the country’s foreign exchange reserves position. All these factors are helping in the restoration of confidence in the economy and have reflected positively on the country’s key macroeconomic indicators. Inflation has thus dropped from triple digits, at the beginning of 2018 to about 40% by the end of the 4th quarter. This trend has been supported by the liquidity tightening stance taken by the Central Bank. The Exchange rate has also relatively remained stable during the period, except in December when the pound lost some value due to high demand for foreign currency during the Christmas festive season. However, the Bank has taken measures to meet the demand by allocating foreign exchange resources for the importation of fuel and food, and other essential commodities.
- The Board deliberated on the Bank’s Corporate-Level Performance Evaluation for 2018. Following the launch of its strategic plan, using the Balanced Scorecard (BSC) approach, the Bank developed a framework for its performance evaluation. During this meeting, the Board deliberated on the first-ever performance evaluation report to be produced by the Bank for the year 2018. Such reports are very critical as they are meant to help the bank to learn lessons. The Board deliberated on the report and took note on the achievements and challenges during the reporting
- The Board also discussed the I SO quarter financial performance of the Bank of South Sudan and the budget execution status in the quarter. In this regard, the Board noted with satisfaction the strong financial results in the l’t quarter, which has exceeded projections by about 3% while expenditures are below projections by about 2%. The board directed the management to further streamline the procurement procedures in the Bank to create more efficiency.
- The Board also deliberated on the progress made by the Bank, regarding the implementation of the International Financial Reporting Standard 9 (IFRS9). This new standard was issued by the International Accounting Standards Board (IASB) to replace IAS 39. IFRS9 introduces changes in the way financial instruments are classified and measured, a new impairment model, and a new approach to hedge accounting that better aligns with risk management practices. The Board deliberated on this new accounting standard and granted approval for the adoption of the standard by the
- Finally, the Board reviewed the status of implementation of its previous resolutions and directives and was satisfied with the level of implementation. The Board appreciated the commitment of the staff towards the implementation of the Strategic Plan and directed the Management to invest further in capacity development in the
Dier Tong Ngor
Governor and Board Chairman,
Bank of South Sudan
The Board of Directors of the Bank of South Sudan, in its regular sitting No. 30/2018, concluded a three-day meeting (December 18 -20, 2018). In the course of the meeting, the Board deliberated on a number of key issues and made a number of important resolutions as follows: