THE EXCHANGE RATE; CAN THE NEW DISPENSATION CHANGE ANYTHING?
Since the signing of the Revitalized Transitional Government of National Unity (R-TGoNU) about a week ago, there has been fluctuation as far as exchange rate is concerned. The United States Dollars depreciated against the South Sudanese Pounds. The 100 USD that was sold at 32,000 SSP was down to 26,000 SSP. But that was not the end. That rate came down to 23,000 SSP and went up to 28,000 SSP two days later. So, the exchange rate in the market remained unstable – and it is still unclear whether it will go back to the previous rate or it will keep dropping. But one thing is certain, the political changes that happened is having a tremendous impact on the economic landscape of the country. Fortunately, this impact is being realized by the leaders themselves as attested by First Vice President Dr. Riek Machar. There is one astonishing thing about this economic shake-up, however. The new government has not yet embarked on the re-engagement efforts with regional and international communities. There is possibility that the economy could change for the better if the unity government takes upon itself to show and convince the world that the country is now a suitable destination for investors. The implementation of the peace deal was a step ahead. No investor wants to pour money in a politically volatile environment, with a volatile economic landscape. This also calls for the establishment of investment-friendly policies to instill confidence in potential investors. I talked about the importance of agriculture in boosting the economy earlier and transforming the livelihoods of the citizens. The Central Bank of South Sudan should allocate sufficient budget to this sector so that farming activities, especially in the rural areas. The country should not be importing items which can be locally produced. With the right investment policies in place, proper budget allocation to the agricultural sector and infrastructure, it is possible the new dispensation can turnaround the economy and stabilize the exchange rate.