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S. Sudan's central bank mulls financial sector reforms

Xinhua, May 5, 2017 Adjust font size:

The Bank of South Sudan said on Friday that it would engage in major restructuring and reformation of its system and financial sector in a bid to combat a biting economic crisis that has plagued the East African nation for the past two years.

Central Bank Governor Othom Rago Ajak said the proposed reforms emanated from the current economic and political challenges that have created internal and external shocks in the war-torn country.

"It is critical that the central bank finds ways to cope with these challenges in a more rapid and strategic manner," Ajak told reporters in Juba.

He said the measures would also heighten vigilance by the central bank to monitor activities of the sector and provide intensive interventions in order to attain financial stability and promote efficiency.

The proposed strategies include, strengthening financial sector regulation, supervision, adaptation of a sound exchange rate policy, public debt management and developing a financial regulatory framework that is compatible with international standards.

Ajak said the central bank will also seek to strengthen credit rating and information, deposit insurance, asset management among others.

He said the new policies are aimed at opening up new market operations through supporting monetary policies, operational efficiency and also enable the financial sector play its role in economic growth and development.

"We will develop detailed strategic objectives in the few coming months, together with specific actions," Ajak said.

War-torn South Sudan depends on oil revenue for 98 percent of its budget, but production decreased significantly due to civil war that erupted in December 2013, causing most oilfields in the country's oil-rich northern region to shut down.

This led to fall in production to less than 130,000 barrels per day (bpd) from 350,000 bpd in 2011.

The east African nation is currently struggling with hyper inflation amid shortage of foreign reserves to support imports. Endit