South Sudan to build reserves, fund budget with new IMF funding

By Richard Sultan

South Sudan has received a $334 million funding from the International Monetary Fund and plans to utilise it for economic reforms, funding the budget and building foreign exchange reserves, the Central Bank said.

The new resources come when South Sudan is implementing essential economic reforms, including monetary and far reaching foreign exchange market reforms, which involve monetary financing of the deficit, the bank said in a statement issued in Juba today.

Coming on the back of a $225 million combined financing in November 2020 and March 2021 it “will address the budget support and the economic impacts of the COVID-19 pandemic, the balance of payment and reserves building,” it said.

According to the Bank governor Dier Tong Ngor, the funding coupled with the improvement of oil revenue will substantially boost the country’s foreign exchange reserves.”

“The increase in reserves will help build external resilience and sustain the current reforms in the foreign exchange market,” Ngor said.

“Building reserves in turn is expected to facilitate price stability and investment flows going forward,” he said.

It will also improve liquidity and gain enough policy space to battle the pandemic while mounting an inclusive recovery.”