South Sudan losses $ 1 billion under 2012-2015 letter of credit project

JUBA – South Sudan has lost nearly $1 billion under Letter of Credit project issued for imports between 2012 and 2015, the latest Audit Report said.

The latest Auditor General’s report indicates that Letters of Credit (LC) issued by South Sudan’s government to various institutions to import commodities and try to stabilize prices were diverted to benefit some individuals.

After the closure of oil production in 2012, the government negotiated dollar supply facilities from the Qatar National Bank and Stanbic CFC Bank to ensure the supply of strategic imports including, pharmaceuticals, fuel, food, building materials, and industrial inputs.

It aimed to empower South Sudanese citizens in the private sector through the affirmative action nature of this mechanism.

The ministerial committee blocks allocations to eligible agencies such as ministries of Petroleum, and Health.

“Some officials involved in the allocation processes report that they issued allocations, not in accordance with the prescribed procedures but due to strong-arm pressure, intimidation, threats, and blackmail by powerful and influential individuals in ‘the entire system,” the report said.

“These include some of the people who make the law, those who execute the law and those who enforce the law,” it added.

The evidence showed that most of the allocations were made, not for the purposes of importing goods to the country, but to give the ‘allotee’ access to dollars at the official rate.

It said that officials in authority took advantage of the systems’ failure and involvement of their superiors in the abuse and joined the illicit self-enrichment queue.

It reported urged the National Legislative Assembly to lift the corporate veil and ordered the Director of Public Prosecution to charge the individual owners of the offending business entities in courts of law.

“The National Legislative Assembly should introduce statutory safeguards giving the government the right and power to investigate and prosecute beneficiaries on undelivered orders,” it said.

It called upon the government to steer clear of technical commercial banking operations to avoid inevitable malpractices of patronage, corruption, politicization, and waste,” it said.

“Steps need to be taken at the executive level of government to find out who are the human beings behind the local and foreign beneficiary companies in this financial scandal,” it said.