South Sudan parliament authorises government to borrow $500 million

AGORA moderator's picture

March 26, 2015 (JUBA) – South Sudan’s national legislative assembly has authorised the ministry of finance to negotiate a loan of half a billion US dollars in a special sitting on Wednesday.

The decision came as crude oil prices shrink globally and daily production in the country has dropped in the oil producing states of Unity and Upper Nile due to the ongoing conflict.

Cabinet affairs minister Martin Elia Lomoru on Wednesday presented the authorisation request to Members of Parliament (MPs) for approval. Lomoro told the lawmakers that the council of ministers had already approved the request by finance minister Daniel Deng Athorbei since 15 February.

“It is then my pleasure […] to read this memo seeking parliamentary approval for the loan worth five hundred million to be solicited from the Qatar National Bank (QNB) by the ministry of finance,” Lomoro said.

He told the parliamentarians that the country’s economy is in “a dire situation” and needed money to keep it running.

A chunk of South Sudanese government’s revenues come from oil by 98%, whereas the daily oil production has dropped from about 260,000 barrels per day (bpd) to 160,000 bpd since the conflict began in December 2013.

Finance minister David Deng Athorbei who also attended the Wednesday’s extraordinary session of parliament said the authorization will enable him to negotiate a half billion dollars loan with QNB, further assuring that the parliament will also have to rectify any agreement reached.

‘There will be a clause which will say ‘any agreement we reached will be subject to rectification by the parliament,” said Athorbei, who took office from former finance minister, Agrey Tisa Sabuni, in January.

“What I am seeking here is the authorisation for this august house to say ‘please go ahead and negotiate for us this loan.’ This is what I just simply want,” he added.

The MPs, when asked by the speaker of the assembly, Manasseh Magok Rundial, after presentations by the two ministers whether they approved the request, they responded “yes” without further deliberations.

“Therefore, there is no need really to refer the matter to the committee,” said speaker Rundial, referring to parliamentary procedure that would have required a special committee’s scrutiny of executive’s presentation in parliament.

“It is only the permission of this House to let him [finance minister Athorbei] go and do the thing [loan negotiation] that will be rectified by us,” he said.

Juba government is believed to have borrowed loans worth billions of dollars in order to supplement its budget including to finance the war.

Rebels led by the former vice-president Riek Machar have demanded that the national debts be disclosed during the peace talks in Addis Ababa, a proposal rejected by president Salva Kiir’s government, saying this was not necessary.

SOURCE: Sudan Tribune, March 26th, 2015, http://www.sudantribune.com/spip.php?article54414