South Sudan’s central banker does not want to manage L/C scheme

The governor of South Sudan’s Central Bank (SSCB) has advised the country’s National Assembly that the bank does not want the power to decide which importers should be allowed access to letters of credit (L/Cs) with which to import food, fuel and other essential items.

The scheme to make L/Cs available to importers in the country – where there is a shortage of hard currency – has proved controversial since it was introduced just over a year ago.

Heavy criticism
The L/C scheme has come under heavy criticism while South Sudanese officials have been accused of using L/Cs meant for low-cost imports for personal gain (DC World News, 29 April 2015).

An apparent problem with the scheme is that very many citizens want the L/Cs because they provide access to hard currency. But central bank governor, Kornelio Koriom, does not appear to believe all those who apply to use the scheme are genuine importers.

Staff threatened
“Everybody who has never gone out of this country wants the L/Cs and wants to be an importer,” the governor told legislators at the National Assembly.

“But not every trader can be an importer. Even he who doesn’t know the ABC of foreign trade will almost kill you if you say no,” he added.

A parliamentary investigation has revealed discrepancies in L/Cs awarded under the scheme to business people and government institutions, totalling over US$600 million, between April 2014 and April 2015.



Categories: Trade Based Financial crimes News

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