ECONOMY-Conflicts, Covid-19 major factors in downfall

By Gilo Jr. Okwata

The government yesterday said the civil war that had engulfed the nation and the occurrence of the Coronavirus pandemic were among the major causes of economic downfall in the country.

Speaking before Assembly Business Committee (ABC), the Minister of Finance and Economic Planning , Salvatore Garang Mabiordit underlined other causes as natural disasters such as flooding and locust, closure of borders, global drop in oil prices and dependent on imported goods.

“I want to give you a brief summary of what we are facing as the Ministry of Finance, the two major issues that causes the downfall of our economy are civil war, which had reigned for over five years, now six, the other one is Covid-19, the other one is natural disasters, and so the economy has been really hampered much by the Covid-19 rather than even by the war itself,” Garang said.

Economy at a Glance

However, he highlighted the current economic crises facing the nation as declining international crude oil price which has dropped from almost 62% (from $104 per barrel in 2013 to $40 in 2016). Drastic decline in daily oil production as a result of partial closure of Upper Nile Oil Fields and total shut down of Unity State oil field as a result of war, resulting in reduction of oil production from 400,000 barrel per day in 2013 down to over 145, 000 barrel per day, military and security expenditure had drastically increased jeopardizing the availability of resources for service delivery and capital spending on much needed infrastructure and development projects among others.

He also said that the government faces other challenges which hinder the collection of non-oil revenue from different agencies or institutions.

“As it was posted to me, I will count one by one, these challenges are tax evasion or tax avoidance, many road blocks which collect taxes illegally but are not remitting them to national treasury, some revenue collecting agencies or institutions do not remit what they have collected and lack of proper scanners and tracking devices for checking goods at the borders,” Garang stated.

In addition, Garang stated that the government had failed to increase the salaries of civil servants due to insufficient resources while the government keeps on expanding, emphasizing the fact that any agreement reached or reintegration would always add to the payroll wage bill.

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