South Sudan Central Bank Governor Dier Tong addresses the media in Juba on Thursday, April 1, 2021 | Credit| Joakino Francis/Eye Radio

The central bank has announced the auctioning of additional $3 million to the private banks in an attempt to stabilize the economy.

The money will be released every week to normalize the foreign exchange rate in South Sudan.

This is in addition to $2 million that the bank has already been auctioning to the forex bureaus.

According to the bank’s governor, the move will prevent further depreciation of the South Sudanese pound against the US dollar.

Dier Tong Ngor told journalists at a media briefing on Tuesday that this would also have a positive effect on the prices of food and other basic commodities.

“This is the new way we will start to supply the market. We will be supplying an amount of $5 million every week – $ 2 million to forex bureau and $3 million to commercial banks,” Tong revealed.

Since December 2020, the Bank of South Sudan says it has auctioned over $30 million to the market.

The bank’s governor insists this move has resulted in the stability of the pounds against the dollar.

1 U.S dollar sells at 195 South Sudanese Pounds as indicated on the Central Bank’s website.

But in the parallel market, 1 dollar sells at 620 pounds.

Governor Tong believes auctioning of hard currency will counter the black market by strengthening the pound.

“I think it has made an impact because it has at least stabilized the parallel market rated for a number of months now,” he asserted.

However, an economist recently advised the government to stop floating the rate of the currency arguing that it gives room for more speculations.

Professor Abraham Matoc believes those with access to the hard currency have monopolized the economy by turning the U.S dollar into a commodity.

In February 2021, the Bank of South Sudan launched and introduced the bill on Tuesday, saying it will minimize the printing costs and end storage space problems.

But another economist emphasized the need for South Sudan to diversify the economy to minimize over-reliance on importations in order to strengthen the country’s currency against the US dollar.