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From: Biniam Tekle (biniamt@dehai.org)
Date: Fri Jul 22 2011 - 10:50:51 EDT
http://af.reuters.com/article/sudanNews/idAFL6E7II24P20110718?sp=true
RPT-South Sudan launches new currency, tensions simmer
Mon Jul 18, 2011 12:30pm GMT
* South Sudan became independent on July 9
* Sudan launching new currency as "precautionary measure"
(Fixes code)
By Jeremy Clarke
JUBA, July 18 (Reuters) - South Sudan started rolling out its new currency
on Monday -- the South Sudan Pound -- escalating a point of simmering
disagreement with Khartoum after the country split away from the north on
July 9.
South Sudan became the world's newest nation after seceding from Sudan under
a 2005 peace deal that ended decades of civil war, but the two sides have
yet to agree on how to manage the oil industry, split national debt and
other issues.
The new nation's announcement last week that it would launch its own
currency earlier than expected added urgency to a dispute over what to do
with the 1.5 to 2 billion Sudanese pounds in circulation in the South.
"It is out, we have launched. The president came this morning and changed
some money. It is in operation now," South Sudan's Central Bank Governor
Elijah Malok told Reuters, adding the currency was already being used on
Juba's streets.
South Sudan's new currency is being exchanged at a one-to-one rate with the
existing Sudanese pound. Malok has estimated it would take between one to
three months to replace the pounds in circulation now.
The move was complicated by Sudan's announcement that it would also launch a
new currency, which the country's central bank governor described as a
"precautionary measure" to protect Sudan's economy .
Sudan is trying to deal with high inflation and the loss of about three
quarters of the united country's roughly 500,000 barrels per day of oil
output after the south seceded. It is eager to fend off any more economic
disruption.
Negotiations are currently stuck on whether Sudan should buy back the
Sudanese pounds circulating in the South. Sudan says the notes will be
worthless.
"We do not want to buy it. We want them to surrender it to us because it is
valueless," Sudan's Central Bank Governor Mohamed Kheir al-Zubeir told
reporters on Saturday.
South Sudan's Malok said the new country had not decided what to do with the
old currency if Sudan refused to accept it.
"If they don't take it, we don't know what we will do with it," he said. "We
will still try to come to an arrangement (with Sudan)." (Writing by Alex
Dziadosz in Khartoum; editing by Ron Askew)
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