Sharp price rises for South Sudan

Sharp price rises for South Sudan
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Published June 6th, 2012 - 08:48 GMT via

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Oil revenues initially accounted for nearly 98% of South Sudan's annual budget
Oil revenues initially accounted for nearly 98% of South Sudan's annual budget
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South Sudanese will have to dig deeper into their pockets, after statistics released by the country national bureau of statistics indicate annual inflation increased to a staggering 80 percent in last month.

South Sudan's National Bureau of Statistics (SSNBS), in its latest report, attributes the souring inflation in the midst of a struggling economy to the unexpected rise in the cost of food and non-alcoholic beverages. "The South Sudan Consumer Price Index (CPI) increased by 29.5% from April 2012 to May 2012. The increase was mainly driven by food and non-Alcoholic beverages," the report partly notes, adding that, the CPI from April 2012 to May, increased by 23.1%, 33.1% and 22.5% in Juba, Wau and Malakal respectively.

South Sudan seceded from the north in July last year, taking with it nearly 75% of oil resources. However, a dispute over oil early this year with neighboring Sudan forced South Sudan to shut down its oil production, leaving the latter entirely dependent non-oil revenues.

Oil revenues initially accounted for nearly 98% of South Sudan's annual budget. David Chan, director of statistic at SSNBS attributes the sharp rise in prices of food and non-alcoholic beverages to fuel scarcity in the country. Fuel scarcity has in recent weeks hit South Sudan's major towns, with officials saying anticipating that the situation could worsen in coming months. "If we don't resolve the current oil disputes with Khartoum, we are likely to suffer from fuel scarcity, high food prices and inflation," David Deng, a special hire driver told Sudan Tribune as he queued in a fuel station. Early this year, a food security assessment conducted by the United Nations showed 4.7 million people at risk of food insecurity in South Sudan this year, with fears that at least a million of them could be severely affected.

Already, a food security outlook update from Famine Early Warning Systems Network (FEWSNET) indicates worrying food insecurity trends as the rainy season sets in, with Northern Bahr el Ghazal, Jonglei and Upper Nile states considered the worst affected regions. Specifically of concern if the abnormal increase in Sorghum prices, which reportedly range between 50 and 250 percent above the five-year (2007-2011) average, and are significantly higher than prices at the same time last year in most reference markets.

The increasing prices, according to the FEWSNET report, reflect the ongoing impacts of last year's below-average harvest, reduced sorghum imports from Sudan due to the trade blockade imposed by the Government of Sudan last year, and increased fuel costs. "Transportation and fuel costs will increase further when the rains begin in March/April, sustaining above-average prices through at least the Outlook period," it says. In Upper Nile, for instance, the food crisis situation has reportedly worsened as a result of the influx of refugees fleeing neighboring Blue Nile State in Sudan, where conflict has persisted since September 2011.

According to the UN refugee agency (UNHCR), more than 81,000 refugees are concentrated in Jammam (36,000 people) and Doro (over 47,000 people) camps in Jinmekda and Buong payams, respectively. However, with a local population of 45,000 people in Maban County, according to the 2008 South Sudan Census, refugees are nearly twice the size of the host population, resulting in extreme competition over access to local resources.

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