Author Topic: South Sudan to change currency to improve economy  (Read 414 times)

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Offline eurocoin

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South Sudan to change currency to improve economy
« on: October 10, 2020, 11:42:54 AM »
South Sudan to change currency to improve economy - government spokesman


JUBA (Reuters) - South Sudan’s cabinet agreed on Friday to change the country’s currency in order to improve the economy, the government spokesman said, without giving further details.

“The cabinet has decided that the current currency should be changed....This is to improve our economic situation,” information minister Michael Makuei Lueth told a news conference in the capital Juba following a cabinet meeting. 

The country’s currency is the South Sudanese pound, adopted when the country gained independence from Sudan in 2011 after a long civil war. Another war, along with graft and mismanagement, led to an economic crisis in the oil-producing nation. In July, a central bank official announced that South Sudan had run out of foreign exchange reserves and could not stop the pound’s depreciation.

Many citizens are keeping their money at home, while others say “if they take their money to the banks, it will be confiscated”, he said.

He did not give a date when the new currency will be introduced.“We will have the new currency anytime....this is the information to the people and the people will be given a time limit.”

He said Friday’s cabinet meeting was also attended by the representatives of the commercial banks operating in the country, who are part of an economic committee working with the central bank.“The committee was given seven days to report back with a clear policy on the economy,” he said.

Source: Reuters.

Offline brandm24

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Re: South Sudan to change currency to improve economy
« Reply #1 on: October 10, 2020, 02:33:17 PM »
Do you know what they mean by "changing the currency to improve the economy", eurocoin? What effect would that have on improving their economy? Would this be a revaluation of some sort?

Bruce
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Offline Bimat

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South Sudan to change currency to improve economy
« Reply #2 on: October 10, 2020, 04:22:43 PM »
Do you know what they mean by "changing the currency to improve the economy", eurocoin? What effect would that have on improving their economy? Would this be a revaluation of some sort?

Bruce

I would presume so. May be they will peg it with some other currency? None of this will certainly improve the economy, though. ;)

Aditya
It is our choices...that show what we truly are, far more than our abilities. -J. K. Rowling.

Offline brandm24

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Re: South Sudan to change currency to improve economy
« Reply #3 on: October 10, 2020, 05:14:48 PM »
Sounds like an easy way to improve ones economy...too easy. ???

Bruce
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Offline eurocoin

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Re: South Sudan to change currency to improve economy
« Reply #4 on: October 10, 2020, 09:37:08 PM »
Well, I really do not know what they may be going to do. I just watched the press conference that was held in South Sudan on which the Reuters report is based and although this is also mentioned in the Reuters report, the South Sudanese government's main aim seems to be to force people to put their money into the bank. It almost seems that the change in the currency is only being used to convince people to do that.

This is what was being said during the press conference in which the South Sudanese people were amongst other things being told that they are spoiled and don't work:

"In addition to that, one of the reports is that most of the citizens are actually hoarding currency in their houses. And most of them hoard them because for so many reasons there are some [inaudible] that if they take their money to the bank that they may be confiscated and so forth. However this is the normal situation that had been happening and there are always solutions for all this. So the Cabinet has decided that the currency should be changed. The currency should be changed so that anybody who does not take his money to the bank is left out and will loose their money. So this is an advice to those who are hoarding money, South Sudanese money, in their houses. You hurry them to the banks. Put them into the banks so that you don't loose them. Put them into the banks as of now so that you avoid queuing up when the time comes for exchanging the currency. This is very important. And this message should actually go across. And people should understand that this is what is going to happen. The current currency will be changed and if it is changed when the time comes up that it is closed then that currency or that money that you have [inaudible]. That will not be [inaudible]".

Offline Pabitra

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Re: South Sudan to change currency to improve economy
« Reply #5 on: October 11, 2020, 04:01:19 AM »
Looks like demonetisation is expected, like they did in India a few years back.

Such efforts fail as long as the same corrupt and incompetent persons continue to enjoy the power.

Online Figleaf

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Re: South Sudan to change currency to improve economy
« Reply #6 on: October 11, 2020, 01:52:48 PM »
I have to tread carefully; the only information I have is what's in this thread. That said, this looks like a "money purification" operation: withdraw old money cold turkey, get new money out through the banks only and confiscate old money that cannot be justified. It works best in a cash-driven economy.

Such operations happened after the second world war in Europe to get at the money of profiteers, more recently in Vietnam to wring black money, primarily of smugglers, out of the system. India did a bungled money purification operation recently, presumable to punish tax evaders. It would make sense for South Sudan, IF indeed there were a significant improvement in political stability and the corruption situation.

Peter
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Offline Pabitra

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Re: South Sudan to change currency to improve economy
« Reply #7 on: October 11, 2020, 02:48:31 PM »
Kenya also did similar exercise when introducing new currency.
All these efforts are wasteful when root cause lies in political power.

Offline Pabitra

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Re: South Sudan to change currency to improve economy
« Reply #8 on: October 19, 2020, 04:29:46 PM »
Apparently South Sudan has been more successful than Kenya

See

http://www.worldofcoins.eu/forum/index.php/topic,49628.msg312105.html#msg312105

Offline eurocoin

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Re: South Sudan to change currency to improve economy
« Reply #9 on: October 28, 2020, 02:13:55 PM »
There has been a bit of a dispute about what was and what wasn't said during the particular cabinet meeting. The information minister of South Sudan during the press conference mentioned that the currency would be changed but the presidency has later denied that a decision like that had been taken.

It appears that the plans were much less certain than their information minister made people believe. It seems that the introduction of a new currency is an idea of which the central bank and ministry of finance of the country have recently been asked to study it, but that certainly no decisions have been taken.

Offline Pabitra

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Re: South Sudan to change currency to improve economy
« Reply #10 on: October 28, 2020, 03:20:43 PM »
The population has stopped using national currency

https://www.bloombergquint.com/onweb/south-sudan-currency-crisis-sees-shops-close-as-prices-surge


The government is attempting to ensure that population uses the national currency

https://www.voanews.com/africa/south-sudan-focus/mixed-reaction-south-sudan-currency-rule

Irrespective of what was said in the meeting, a situation similar to Zimbabwe is developing in South Sudan.