SOUTH Sudan’s foreign exchange reserves are improving, owing to the resumption of oil production and the gradual increase in global oil prices.
‘With the increase in global oil prices, at least our situation would be much better than two years ago,’ Governor of South Sudan’s Central Bank, Deng Tor Ngo said last week.
South Sudan, which is the world’s most oil dependent country, relies on the export of oil for its foreign exchange and building of foreign reserves. With the civil war crippling the country’s stability five years ago, oil production reduced, affecting its economy.
South Sudan resumed oil production from the Toma South oilfield in August this year at a rate of 20,000 barrels per day (bpd), adding to its total daily average of 130,000 bpd.
The country expects to resume full oil production of 350,000 bpd by the middle of 2019, and has reached a new deal with Sudan on oil transit fees.
Under the new deal, South Sudan will pay $4 per barrel fee, down from $9.1 a barrel under a previous agreement from 2012.
Oil represents almost all of South Sudan’s exports and around 60 percent of GDP.