South Sudan has set plans in motion to replace its legal tender; the South Sudanese Pound after less than ten years of use.
According to the Juba administration, the process of demonetization will help boost the nation’s economy, stop any plans to store up the currency, and also put an end to its financial troubles.
The nation’s civil war coupled with its struggles with its neighbors in the north are among the factors that contributed to the fall of its economy.
The Central Bank of South Sudan had in July of 2020 revealed that it had run out of foreign exchange reserves and was unable to curb the depreciation of the South Sudanese Pound.
The South Sudanese Pound pound has in recent times experienced a swift depreciation. It exchanges at 510 South Sudanese Pounds to 1 dollar on the underground forex market.
The official exchange rate has however remained at 167 South Sudanese Pound to the Dollar.
The nation has also been negatively affected by the ongoing Coronavirus pandemic which has hit the entire world.
South Susan’s revenues dropped drastically due to a similar drop in oil’s price across various world markets. A development which resulted in the nation reducing its production of oil to around 165,000 barrels per day.
Although South Sudan controls its Oil Sector, it still depends on the facilities of its northern neighbors in the selling of its oil.
South Sudan first introduced the South Sudanese Pound after it gained its independence from the north, following a peace deal in 2005. At the time, the South Sudanese Pound was one to one with Sudan’s already existing currency.
The Juba administration however as at the time of compiling this article, has not announced an official date for the demonetization or provided any more details.
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