Auction the dollar ‘in silence’, Central Bank told

Auction the dollar ‘in silence’, Central Bank told
Fake dollar notes. [Photo: Snapchat]

The Bank of South Sudan has been criticised for publicly announcing the auctioning of the dollar to the market.

Dr. Abraham Maliet Mamer, an economist said public actioning through the media is to blame for the spike in the dollar’s strength.

“There is no need to make these (press) releases. If you want to sell dollars, do so without announcement because if you alert people, the speculator will go out there and sell all the dollars on the market, and the dollar [strength] will increase,” Dr. Maliet, who is also government advisor on economic cluster said.

“It is a serious financial crime of which people are not aware. It should not be announced,” the economist stressed.

He added that recent appreciation in the strength of the dollar was caused by people receiving auctioning alerts.

“The letter of credit should be made between bank and bank and both buyer and seller should go through the bank. They should not be made attached to cash,” he said.

“So for us to control the dollar, we must go back and introduce the actual letter of credit.”

He advises that South Sudan needs to digitalise its financial system to control cash flow.

“In the western world, if you go to the bank to withdraw your own money, you will not be allowed to withdraw more than a certain amount. You will only be allowed to do internal banking transactions, which means if you want to buy something, just go to the bank and transfer the money to that person’s account.”

Central Bank speaks

Earlier in the month, Central Bank governor Johnny Ohisa Damian blamed multiple factors among them the burden of imported goods on the tribulations of the local currency whose value continues to plummet.

“The US dollar’s [strength] is exacerbated in part by the Federal Reserve’s rate hikes to combat surging inflation, rising prices of imported essential commodities in the international market, and speculative motives,” stated Ohisa in a statement issued on February 10.

“The Bank has amassed sufficient foreign exchange reserves, enhancing its ability to intervene in the foreign exchange market on an as-needed basis to smooth out high volatility.”

He added, “These reserves are generated because of the successful implementation of the Treasury Single Account (TSA) and the liquidation of a portion of the country’s Special Drawing Rights (SD) from the International Monetary Fund (IMF).”