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Economists Urge New Economic System for South Sudan

David Mono Danga

   JUBA/GENEVA -- While some South Sudanese experts recommend the
   government adopt a new economic system used by developing states to cut
   off black market currency exchange and stabilize skyrocketing prices, a
   new U.N. panel report says the real problem in South Sudan is deeply
   entrenched government corruption.
   South Sudan should switch to a developmental state economic system
   under which the government could control prices, the black-market
   foreign exchange rate, and the flow of currency in and out of the
   country, according to Abraham Matoch, economics professor and vice
   chancellor at the Doctor John Garang Memorial University of Science and
   Technology in Bor.
   "There's no rule in a new country wishing to reconstruct, rehabilitate,
   and reconstruct to move immediately into a free market economic level
   which is more or less a catalyst, and therefore, I encourage having a
   developmental state economic system because we cannot apply a
   capitalist economic system in a developing country," Matoch told South
   Sudan in Focus.
   The developmental state economic system embodies strong state
   intervention, as well as extensive regulation and planning.
   In South Sudan, speculators are able to manipulate foreign exchange
   rates to their advantage, said Matoch.
   "If the commercial banks or the forex [bureaus] go and abuse the
   exchange rate to keep the bulk of the money or dollars with them for
   black marketing, this will affect the economy. And this is exactly what
   has actually happened," Matoch told South Sudan in Focus.

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