South Sudan’s central bank plans to operate “a managed float” of the country’s currency, setting its exchange rate depending on the price of oil and the value of regional currencies, the bank’s president Elijah Malok said.
Initially, the South Sudan pound will be equal in value to the Sudanese pound, Malok told reporters today in Juba, the capital. The Sudanese pound currently trades at about 2.67 to the dollar, according to the Central Bank of Sudan, while on the parallel market it sells at about 3.3 to the dollar.
The value of the currency will be decided by a committee that includes officials from the central bank, the Ministry of Energy and Mining and the Ministry of Finance, he said. The South Sudan pound, printed by De La Rue Plc, the world’s biggest printer of banknotes, will arrive tomorrow, Finance Minister David Deng Athorbei said yesterday.
The currency should start to be distributed on July 18 or July 19, Malok said.
South Sudan became independent on July 9, six years after the end of a two-decade civil war with the north that killed as many as 2 million people. The country of 8 million people now controls about 75 percent of Sudan’s daily production of 490,000 barrels of oil, pumped mainly by China National Petroleum Corp., Malaysia’s Petroliam Nasional Bhd. and India’s Oil & Natural Gas Corp.
Sudanese President Umar al-Bashir told parliament today that his country will replace its currency in the coming days as South Sudan issues its own notes.
The South Sudanese authorities are negotiating with the Sudanese government about the exchange rate the south will receive when it sends the oil Sudanese pound notes back to the capital, Khartoum, Malok said.
“The north is going to take the old pound,” he said. “The price is not worked out yet.”