Bloomberg News

South Sudan Detain Money Changers in Bid to Stabilize Currency

October 14, 2011

Oct. 14 (Bloomberg) -- South Sudanese authorities detained more than 20 illegal money changers as part of a plan to help stabilize the newly independent nation’s currency, a police spokesman said.

Information including the names of those held and the amount of currency they were carrying was handed to the Justice Ministry, Biar Mading said in a phone interview today from Juba, the capital. Mohamed al-Haj Baballa, the mayor of the city, issued the order for the police to take action, he said.

“There will be more arrests,” Mading said.

The country introduced the South Sudanese pound after splitting from the north and declaring independence on July 9. The new currency, which replaced the Sudanese pound, currently trades at about 4 per dollar on the black market. The central bank said on July 18 the pound would be equal to the Sudanese currency, which traded at 2.67 per dollar that day. Three foreign exchange bureaux in Juba quoted the official rate at 2.96 per dollar today.

The decline in the pound’s value on the black market contributed to a rise in prices of food and other commodities in South Sudan, Mading said. “It’s causing inflation,” he said.

The decision to curb trade on the black market came after a meeting on Oct. 11 of the Finance and Economic Planning Ministry, the central bank and security agencies, the New Sudan Vision news website reported on Oct. 12, citing Deputy Interior Minister Salva Mathok Gengdit.

After independence, South Sudan gained control of about 375,000 barrels a day of oil, about 75 percent of the former Sudan’s total output, the third-biggest in sub-Saharan Africa.

For Related News & Information: On South Sudan’s Oil Industry: {TNI SOUTHSUDAN OIL <GO>} Top Regional Stories: {AFTO <GO>} Most-Read Africa News: {MNI AFRICA <GO>}

--Editors: Paul Richardson, Karl Maier.

To contact the reporter on this story: Jared Ferrie in Juba via Nairobi at pmrichardson@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net.


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