Economist blames high costs of living on low productivity, import dependency

JUBA – A South Sudanese economist has blamed the high cost of living on low productivity and the local currency’s weakness due to heavy reliance on imports.

Speaking to Sudans Post on Wednesday, Abraham Matoc, Vice-Chancellor of Dr. John Garang Memorial University of Science and Technology, attributed high market prices to production costs inflated by low output.

“The economy isn’t producing anything, there’s no productivity, so there’s not enough supply of goods and services,” Matoc said.

“The import-dependent economy needs hard currency, and because of that, the exchange rate has skyrocketed as people trade in dollars instead of the South Sudanese pound,” he added.

Matoc argued that low productivity inherently drives up living costs, especially in urban areas.

He added that the dollar has become a tradable good rather than a means of exchange.

“There’s no circulation of money within the economy, and there’s no investment from small and medium-sized businesses,” he said.

“Our money is flowing out to neighboring countries, either through people buying houses or seeking medical care there,” he added.

Matoc emphasized the negative impact of capital flight.

“The outflow of local currency is too high, and that’s another economic woe,” he said.

“The cost of living will only come down when our economy becomes productive enough to create a surplus of goods in the market, leading to better supply and lower demand pressures,” he concluded.