An economist has suggested that the country’s financial institutions must adopt policies of managing a war economy like South Sudan.
In a war economy, the government must make substantial adjustments to its consumer production in order to accommodate defense production.
However, South Sudan only produces oil as it main source of revenue which research groups say is being used to fund military activities.
Ahmed Morjan, a lecturer of Economics at the University of Juba, made the remarks while commenting on a statement made by President Salva Kiir that the central bank has run out of money:
“We have economic policies of managing war economies which South Sudan should have started applying long time ago because we know that the normal procedure of managing an economy is through production.”
Mr Morjan said the conflict in the country has affected production; therefore, alternative options should be implemented.
“Some countries have used borrowing as a way of managing war economy, reducing expenditures on unnecessarily things and streamlining most expenditures on necessities in the country,” he said.
The Central Bank keeps the deposits of the national and state governments and makes payments on behalf of governments.
It is also the country’s main regulator of currency and custodian of cash reserve of commercial banks.