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Expert urges Juba to use oil revenue to diversify economy, as export resumption looms

Author: Moyo Jacob Felix | Published: October 17, 2024

Prof. Abraham Matoc, professor of economics and Vice-Chancellor Dr. John Garang Memorial University [Photo: Awan Achiek/Dawn]

As South Sudan yearns to replenish its dry coffers when it fully resumes crude oil export through Sudan, a professor of economics said the government should be smart enough to use the oil revenue in investment and development projects including agriculture.

The ongoing Sudan war has plunged South Sudan into economic turbulence after one of the pipelines transporting 60% of its crude oil broke down in February 2024, thus putting the country’s financial lifeline at risk.

The dwindling oil export, which accounts for more than 90 percent of the national revenue, left South Sudan currency severely weakened against the US dollar, triggering a sharp increase in commodity prices and leaving many families struggling to make ends meet.

Civil servants and members of the regular forces in the country have gone for more than 10 months without salaries.

But on October 13, the Ministry of Petroleum Undersecretary Dr. Chol Deng Thon said the damaged pipeline has been repaired and is fully ready for crude transportation.

Dr. Thon disclosed the development after he led a delegation to Port Sudan to assess the pumping levels and ensure that operations at Station Number 6 of the crude oil pipeline.

Citing the maintenance company, the oil official said, the pipeline is now fully operational and ready to resume oil transportation.

Abraham Matoc, Professor of Economics at Dr. John Garang Memorial University of Science and Technology, said the resumption of oil production will boost the country’s economy and enable the government to cater for several developmental projects.

However, he suggested that the oil money should this time prioritize implementation of the peace agreement, investment in agriculture and road construction projects.

“It has a great impact on the economy. First of all, it relieves the government and the government will have a breathing space even to pay the salaries,” he said in an interview with Eye Radio.

“And also, the government has been involved in the construction of roads and that is a development program. Now the government will be able at least to pay the sectors that are constructing the roads and even the peace.”

“The oil money, in fact, is supposed to engineer development whether in the agricultural sector, whether in the service sector and all these things plus the issue of salaries.”

 

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