Economist urges central bank to fix exchange rate

JUBA – A South Sudan economist on Wednesday urged the country’s central bank to fix exchange rate of the South Sudanese Pound against foreign currencies in a bid to salvage the deteriorating economic situation in the country.

Abraham Matoc, Vice-Chancellor at Dr. John Garang Memorial University in Jonglei state, said floating exchange rate gives room to speculators to monopolize the dollar.

“The government should fix the rate of exchange because we are still growing, and if we are still growing, we can’t open to a free market. The free market here is completely misunderstood. Take for example the exchange rate. the exchange rate now is floating in a sense that it is a free market economy,” Matoc told Sudans Post reporter in an interview on Wednesday.

Professor Matoc believes those with access to the hard currency has monopolized the economy by turning it into a commodity.

“Among the so-called free marketers. There are few individuals who have some means of having a lot of money and controlling the market and the exchange rate is exactly governed by the U.S dollar and the U.S dollar is now taken as a commodity. It is not the medium of exchange any longer,” he said.

Matoc believed fixing the rate will help to a reduced sharp rise in the prices of basic commodities in markets.

“One unfortunate thing is that the business sector practical in the market, they will begin to price their goods according to the rate of the dollar, even when the goods were bought in 2010, they still fixed them with the current rate of U.S dollar making it so difficult and making the market so expensive for the public to buy the goods,”  he said.

South Sudan has three exchange rates – one from the central bank, one from commercial banks, and another from the so-called parallel.

As of Wednesday,  $1 is equivalent to 61 South Sudanese Pounds in the black market, while at the Central Bank, a similar amount sells at 180 pounds.