Stop old theory “auctioning” and embark on productions – economist
By William Madouk Garang
An economist has termed the central bank’s auctioning off millions of dollars as a measure to tackle the volatility exchange rates as ‘old-theory’ and called on the institution administrators to think outside the box and embark on investing in the production of goods and services to revamp the economic.
According to the economist Dr Abraham Maliet Mamer, South Sudan can produce its own hard currency if it introduces agriculture, cash crops and commoditizes some minerals such as gold, iron to be exported outside the country.
Dr Mamer who an economic advisor in the office of the Vice President for the Economic Cluster, Dr James WaniIgga said that auctioning is a short-term ‘risk management policy that the country should avoid.
“The idea of the auction is not new it’s an old practice, I think in the [East Africa] region here there is no country that is auctioning dollar what they do is they make it[dollars] available to cooperative banks [to ease buying and selling],” Mamer said
“I am suggesting it should stop because it’s not any longer a modern practice but the only way we can stop it, we have to produce, we have to produce goods and services that will delete the bill of a dollar,” he added.
DrMamer stressed that if the government encourages the people of South Sudan to produce then the country would not import many goods anymore since crops will be home-produced and exported to get dollars instead.
“If [we] build good health facilities or hospital then the money we gave to the people for treatment aboard will not need a dollar, they can do their treatment here [country] using pound because when you go to a local clinic you don’t need a dollar, so, the demand for dollar in that aspect drop,” he noted.
However, the Vice-Chancellor of Dr. John Garang Memorial University, Prof. Abraham Matoch Dhal agrees with the governor of Bank of South Sudan Moses Makur Deng’s increase of auctioning amount policy in fighting the inflation rates saying it’s in the right direction.
“The fact that he has increased the amount of auctioning I think he is in the right direction because I am sure he’s targeting the reduction of inflation and to [make sure] that people who are using the dollar as commodities is mitigated,” Dhal cited.
“Definitely the dollars will come actually down it’s a matter of time now but it will come it has already come down from 60 to 43 now and definitely, is going to go down further and it’s getting the South Sudan Pound back into the bank which is good,” he added.
Meanwhile, a renowned activist, Edmund Yakani who heads the Community Empowerment for Progress Organization (CEPO) said the central bank should cease auctioning dollars because it will only bring little changes.
“Central bank, [should] start to improve private sector to buy goods in a low rates dollar so that the prices in the market in Juba can reduce so I don’t think that [auctioning] is sustainable and a right solution,” Yakani explained.
“Government need to invest in production sector so instead of auctioning, let them use these dollars to in from agricultural sector, local produce which will automatically have an impact of prices and cheaper prices,”