Troika praises South Sudan’s reforms for financial institutions
The Troika has promised to support President Salva Kiir’s recent changes in the financial institutions in a bid to effect reforms provided for by the revitalised peace agreement.
In a joint statement on Friday last week, the United States, Norway, and Britain welcomed the recent agreement that touched on the Bank of South Sudan.
However, they also stressed the urgent need to fully implement the public financial management reforms to prevent South Sudan from sliding back into the devastating economic crisis.
The body commended South Sudan for achieving important progress in the last year and a half on public financial management reforms, including prudent monetary policy, successful foreign exchange reform, and steps towards sounder public cash management.
They said South Sudanese have already benefited from a more stable exchange rate and lower inflation, urging the government and those now charged with leading economic recovery to continue with the reforms, in line with R-ARCSS and South Sudan’s commitment under the IMF Staff Monitored Program.
“The recent significant appointments related to South Sudan’s economic management come at a critical time of the reform process, as South Sudan is preparing to exit an IMF Staff Monitored Program and hopes to access a new loan in the coming months,” the statement read in part.
“The Troika underscores that a faster pace is needed in the implementation of public financial management reforms. In this regard, the Troika stresses the importance of continuing and further strengthening the current reforms, which will demonstrate the government’s commitment to the reform process and enhance trust with international partners, ” the Troika said.
President Kiir last Monday made changes at the Central Bank and Ministry of Finance and Planning to relieve and appoint top management officials.
He sacked Dier Tong Ngor and replaced him with Moses Makur Deng as the new Central Bank Governor.
The Head of State also relieved the First Undersecretary of Finance at the Ministry of Finance and Planning, Ucujung Genis, and replaced him with Simon Kiman Ladu.
Despite little improvement in the country’s economy during the officials’ administration, it seems the president was not satisfied and wanted further improvement.
Before the decree, the head of state had promised that 2022 would be the year of reform, as provided for in the 2018 revitalised peace agreement. He prioritised economic reform in order to gain international support for the peace process and find ways to obtain non-concessional loans.
However, the Troika stressed that continued respect for the moratorium on incurring new non-concessional debt, including not issuing letters of guarantee, will spare ordinary citizens the burden of higher taxes or reduce public spending in the future.
They further emphasised that sound monetary policy was key to maintaining low inflation and a stable exchange rate, both of which would help shield the people of South Sudan from rising prices.
“This means that the Bank of South Sudan must refrain from any monetary financing of the budget deficit. “The Troika also stresses the need for the budget to be debated and passed by TNLA and highlights that a fully functional Cash Management Committee is key to sound spending in line with budgetary allocations,” partly reads the statement.
Call for transparency
Furthermore, the Troika called on the government to publish information on any debt Sudan might owe South Sudan from the oil it receives in-kind each day on the Ministry of Finance and Planning’s website regularly and without delay, including any outstanding balance owed to Sudan on the Transitional Financing Arrangement.
“The Troika anticipates a full and complete audit of the second tranche of the IMF RCF loan, as well as further progress on anti-money laundering reforms as per the FATF Action Plan,’’ they stated.
However, the Executive Director of Community Empowerment for Progress Organization (CEPO), Edmund Yakani, said the Revitalised Transitional Government of National Unity (RTGoNU) should take Troika’s statement as a wake-up call for regaining trust and confidence from the international and donor community
“Sincerely timely delivery of the proposed R-ARCSS public financial management reforms, enactment of a sounder national budget, and embracing transparency and accountability are possible gains for winning the international community and donors’ support for the implementation of the R-ARCSS.”
“Without proper public financial management improvement, it is hard to regain the international community and donor’s trust and confidence for financing R-ARCSS,” Mr. Yakani said.
