Sunday, 11 March 2012

Written by Daniel Sebit

The prices of many food items have nearly doubled in the last two years, 'The New Nation' has established.

A 100kg bag of maize flour now goes for SSP180, up from SSP90 in 2010. Analysts point

at the lack of local food production, forcing the country to buy food at high cost from Uganda and Kenya. Traders, on the other hand, blame high taxes at the border and high transport cost.

A 100kg bag of maize flour now goes for SSP180, up from SSP90 in 2010.

A bag of sugar of 50kg goes for SSP225, up from SSP130 two years ago, while a kilo of meat now costs SSP20, up from SSP12.

The high food prices are particularly affecting the poor, estimated at over half of the population.

As Zeinab, a house wife in Juba, put it: “You go with a lot of money to the market but you come back with very little food that cannot even satisfy your family.”

Among the poor, the returnees from North Sudan and neighbouring countries are the hardest hit. They have neither the capacity to produce food nor the resources to buy food.

The assistance they receive from international agencies and government is not sufficient to meet their needs.

Analysts point at the lack of local food production, forcing the country to buy food at high cost from Uganda and Kenya.

Traders, on the other hand, point at high taxes at the border and high transport cost due to poor roads, particularly the stretch between Yei and Kaya.

As a result, maize in Juba is about three times more expensive than in Uganda, while beans are about two times more expensive.

A just released report of the World Bank calculated the cost of transport from Uganda to Juba at $145 per ton and the cost of duty and other official charges at $218 per ton.

Trucks unload some of their cargo at the border and sell them to foot, bicycle or motorbike transporters in order to reduce tax payments.

The limited hours of operation of the Sudanese customs, which close in the weekends, and the poor customs management and staff capacity also push up the prices since traders have to wait for many hours and sometimes days at the border to be cleared, notes the report.

Additional taxes charged at state level account for more delays. On the Nimule-Juba route, Central Equatoria imposes state taxes at Juba Bridge.

“Juba Bridge becomes a major bottleneck. The import cargo spends on average an extra two days at Juba Bridge”, says the report. Hadijja, a vendor in one of the markets in Juba who deals in beans, onions, cooking oil and tomatoes, said because of heavy taxes she has resorted to retailing her goods because it is more profitable.

“Prices are high because we are being taxed heavily at the border. We also face issues of transportation, acquiring legal papers and high rent. So at the end of the day, one will be left with a loss if the price is low,” she explained.

“The meat we sell comes from cattle in Uganda which we buy at high prices. The transportation and charges on the road cost us dearly. So we have no choice but to increase the prices,” explained a butcher, called Abdu. For Abdu, meat prices can be reduced if the cattle keeping communities in South Sudan stop keeping cattle for prestige and marriage, and instead release the cows to the market for slaughter.

Stephen Modi, a civil servant, called for urgent Government intervention. “It is really unbearable, I think the Ministry of Commerce should ensure that prices are reduced and the markets should be monitored,” he told The New Nation.

He added that increase in local food production should be taken seriously if food prices are to become normal.

A student of Economics at the University of Juba, Joseph Gama, suggested that the Government increases humanitarian assistance to the most vulnerable.

“The government and its development partners should consider targeted subsidies or safety net programmes to meet the basic needs of the most vulnerable, including returnees and disabled people,” Gama said.

He also suggested that the Government and the donors provide agricultural inputs to the poor and introduce food for work programmes.

Haroon Abdallah, speaking from his maize flour store, said: “There is need for immediate policy measures for the removal of multiple taxes on staple food.”

He argued that this will facilitate competitive regional trade which will contribute to the reduction of prices in South Sudan.

Tuesday, 28 February 2012

Written by Nyuon Ruai and David Majur

As oil Talks with Khartoum fail Again

JUBA: The Ministry of Finance and Economic Planning will soon unveil austerity measures aimed at increasing non-oil revenue collection as no deal has been reached with the Sudan  Government on oil transit fees and compensation.

The Minister of Information, Barnaba Marial, told journalists during the weekly government press briefing that the austerity plan has already been presented to the Council of Ministers.

South Sudan lost 98% of its Government revenues when it closed the oil taps earlier this month  in protest of the confiscation of its oil by the Government of Sudan. Khartoum in December took

over ships loaded with South Sudanese oil worth $815m to make up for what it called unpaid fees for shipping the oil through its pipeline.

The Government of Sudan want $36 per barrel in transit fee while South Sudan is willing to pay less than $1 per barrel, which is close to the international norm. For a similar pipeline of comparable length that runs through Cameroon, the Government of Chad pays $0.41 per barrel. The African Union, as well as countries such as Britain and China, which gets about 6% of its oil from South Sudan, are trying to broker a settlement. But a second round of talks in Addis Ababa last week has not produced any white smoke.

“The gulf is still huge,” South Sudan’s foreign minister, Nhial Deng Nhial, said in a statement.

“I don’t know if it can be bridged.” The two countries did sign a non-aggression agreement

that is supposed to keep the peace until a broader solution is found. But the pact was broken

within hours.

According to a Ministry of Finance press release posted on the government website, the Directorate of Taxation will soon launch a campaign aimed at expediting

the country’s transition to non-oil revenue and a more independent economy.

“Within six months, the campaign aims at increasing non-oil revenue collection by 300%,”

the statement says.  “Right now, we are collecting about SSP13m a month in non-oil revenue, not including customs”, the statement quotes the Minister of Finance, Kotsti Manibe.

“In the next six months we want to increase that to SSP40m a month, which is still about 5% or less of pre-shutdown monthly expenditure by the Government, but it is enough for some essential services.”

The government is working to systematise taxes collection in all sectors that can make up for

the lost oil revenue.  While assuring that no new taxes will be introduced, the statement adds: ‘The ministry is just enforcing regulations that have been on the books since the passage of the Taxation Act of 2009, but not enforced widely.”

The directorate plans to launch taxpayers’ education for business people and  income earners across South Sudan about their right and obligations, through radio, print and training of education officers.

Estimates of how long the government’s monetary reserves will last vary wildly, from a few months to perhaps half a year.

For 30 months we will

definitely freeze our activities on

development - Riek Machar

Government officials promise to give priority to health, education and the army with the 2% of its revenue that remains. And the government says it has ambitious long-term plans to overcome the crisis. It signed a deal with Kenya last month for the construction of a pipeline to the port of Lamu at the Indian Ocean.

A second agreement was signed for a pipeline through Ethiopia and on to Djibouti at the Gulf of Adam, Mariel told journalists earlier this month.

South Sudan’s deputy petroleum and mining minister Elizabeth James Bol told Reuters it

would take around 11 months to build the pipeline to Lamu.

But analysts said a Kenya pipeline would be difficult to build across rough terrain hit by tribal violence and passing  through bandit-stricken regions in western Kenya.

South Sudan has said it would cost around $1.5 billion, but analysts say a hefty insurance

premium would have to be added because of the security concerns.

Oil experts have questioned the economic viability of a pipeline in the medium-term

as output is expected to fall sharply in coming years because some fields were over pumped

by Khartoum in the run-up to South Sudan’s independence.

South Sudan output will decline to 200,000 bpd by 2016, to 160,000 by 2018 and further thereafter, according to estimates by the European Coalition on Oil in Sudan.

Some analysts say a pipeline would be viable only if new finds were made, but exploration

in the vast Jonglei state have been hampered by tribal violence. France’s Total holds a

concession in Jonglei which is largely unused due to violence.

Leading SPLA politicians have come out in recent days to support the decision to shut down oil production.

“Unfortunately Khartoum has not co-operated with us, so instead of Khartoum taking the oil, we’d better freeze it until we get alternatives to exporting oil, so that the people of South Sudan can enjoy their own resources,” Vice-President Riek Machar told BBC on Friday.

He said development would be put on hold for several years, but basic services would not

suffer. Machar assured that government salaries, including for those for members of the large

military, would be paid.

“For a period of 30 months we will definitely freeze our activities on development, but

we’ll provide basic services:

health, education, water and even some infrastructure projects will go on,” he said.

Luka Biong Deng, former Minister for the Presidency in Juba, called the decision a bold

but wise move. He said the crisis could offer a golden opportunity for South Sudan to trim the Government and develop scenarios of running the new nation without oil revenues.

“Salaries and operating costs constitute more than 80% of total expenditure, the highest level in the region”, he wrote in an opinion article to The New Nation.

“Simply, the Government is too big and the austerity measures should focus on how to slim the Government without affecting spending meant for the rural population, particularly in education, health, water and agriculture.”

Related stories on pages 5, 24, 27 and 30

Sunday, 26 February 2012

Written by Els De Temmerman

Letter from the Editor

Dear readers,

I am proud to present to you the first issue of ‘The New Nation’, a newspaper that was born out of a dream and made reality thanks to the support of the Belgian government.

Sudan is the country where I began my Africa journey a quarter of a century ago. I was 25 years old and an aid worker in Nyala, Darfur.

Tens of thousands of people had fled the war and famine in Southern Sudan and turned up in our area of operations.

They were starving, crawling around the hostile terrain like living skeletons.

Our attempts to feed them in a camp called Safaha were hampered by huge logistical problems and the confiscation of our food by local authorities in the north.

I ended up selecting malnourished children. Only a limited number could be admitted to our feeding centre considering our dwindling stocks.

At the end of that year, the UN announced that 500,000 people had died in the belt around the Bahr el Arab, where Safaha was.

“Safaha, I will never recover from it,” were the last words of my diary, which was published in a prestigious Belgian magazine and earned me a job as a journalist.

The little known tragedy of Safaha in 1988 prompted me to give up my relatively comfortable life in Belgium and become a journalist in Africa.

So accepting this opportunity to help rebuild a society devastated by nearly half a century of war is like going back to where it all began; the very reason for my being here.

‘The New Nation’ is a unique, not-for-profit project. It is prompted by the belief that information - practical information that fits local needs and can advance people’s lives – is a basic right, just like health care and education.

It should be accessible to everyone – also and especially the poor and illiterate.

That is why 5,000 copies of this newspaper will be distributed free of charge to schools, health centres, local governments, radio stations and NGOs around the country.

That is also why a copy of ‘The New Nation’ will be laminated and put on display at information ministries in every state capital.

For those who want their own copy and can afford it, the paper will also be sold at selected sales points in the major towns of South Sudan to cover part of the operational cost.

Apart from the newspaper, we also run www.thenewnation.net, which was launched on the day of South Sudan independence. 

Knowledge and information, be it on health, agriculture or business opportunities, are great tools for development and economic growth. That has been shown by recent studies about the impact of the Internet.

A 10% increase in Internet penetration could increase a country’s income by up to 2.5%, according to a 2009 study by the Boston Consulting Group and Telenor Group.

It also increases new business activities by approximately 1%, and boosts total government revenues by as much as 9%.

The free flow of information and the exchange of experiences have also proven to be healthy for society. Psychologists argue that exposure and truth telling, such as the Truth and Reconciliation Commission in South Africa, have a healing effect.

Sociologists, on the other hand, point out that openness and transparency can help bring down corruption and human rights abuses.

Indeed, history has shown that some of the worst abuses occurred in closed communities – be it dictatorships, sects, prisons or boarding schools.

Even the suicide bombers of the terrorism era have all proven to be closed communities in their own way – quiet, withdrawn human being, locked in their own narrow-minded logic and reasoning.

‘The New Nation’ is also unique in that it will bring news from all around the country. To that end, correspondents have been identified in every state (of South Sudan) and trained, not only in news gathering and writing but also in media ethics and values.

Indeed, I dare to say that we have a very committed, competent and fine team of journalists who share with me the passion for journalism – to record history accurately and responsibly and, in this way, contribute to more openness, more transparency and a more just and peaceful society.

Dear readers, now that I embark on this journey with you, I want to make a contract with the public.

A newspaper is not a one-way channel of communication. It is a dialogue with the readers. Reactions, opinions, tips and comments from people of all walks of life will be highly welcomed and appreciated.

Our job as journalists is to ‘process’ information, translate complicated issues into simple language which everybody can understand, but the raw materials have to come from all of you.

We shall also have sections for letters, opinion, and commentary where readers can write directly to the editor to express their views. This will help us ensure interactivity and relevance.

It is my sincere wish that this joint enterprise will help all of us to recover from tragedies such as Safaha, and put the world’s youngest country on the road to development, peace and prosperity for all.

The author is an international award winning journalist, author of five books on africa and former Editor-in-Chief of Uganda's New Vision

Thursday, 09 February 2012

Written by Peter Moi

Ivory Bank and Centenary Rural Development Bank (CERUDEB) of Uganda Thursday signed a memorandum of understanding (MOU) aimed at promoting exchange of information between South Sudan and Uganda.

Speaking after signing the MOU, the managing director of CERUDEB, Fabian Kasi, said they share the same values with Ivory bank.

"We have identified Ivory bank as a partner to work with in South Sudan. I appeal to Ugandan traders in South Sudan not to risk carrying money, but to deposit with Ivory and get it in Uganda," he said.

Kasi said they have agreed on capacity building of staff to ensure offering of best services to their clients.

The managing director said that centenary bank has worked in Uganda for 27 years and holds 30% of accounts in Uganda mostly serves rural areas.

On his part, Ivory bank general manager, Rizig Yatango, said that banking business has to be promoted in South Sudan.

"A nearest neigbour is far better than a brother. This will promote various areas for cooperation," he said.

He stated that the initiative that has already begun will help mostly the business community.

Last year, a similar MOU was also signed between Ivory and Commercial Bank of Africa based in Kenya.

The director for banking and supervision of the bank of South Sudan, Daniel Kech, noted that he is happy now that local banks are getting connected to foreign banks.

"Local banks lack capacity to run their banks and building Ivory bank capacity by centenary is a welcome move," Kech said.

He added that since most clients are uneducated, they have invited Standard Bank of South Africa to teach clients on how banking works on trade finance.

Ivory bank is an indigenous bank in South Sudan that has been in operation since 1994 and has eight branches.

There are currently five foreign and six local banks in South Sudan according to sources in the central bank.