BOR - South Sudaneswe merchants claim they are being denied access to letters of credit (LCs), which allow businesses to buy U.S. dollars at the official exchange rate of around 3.2 South Sudanese pounds to the dollar, instead of the much higher black market rate.
Majok Kuur Kuer, say that's the problem: the LC program is tainted by corruption and cronyism.
"And the government should verify that the merchant actually buys and sells goods. If not, they should question if the recipient of the LCs is running a business that is eligible to receive LCs in the first place," he says.
Wholesaler Jok Muoch says that in the seven years he's been in business in the Jonglei state capital, Bor, he has never received any funds through the letters of credit program.
"LCs don’t reach us," Muoch says. "The government has to identify those who are working, the real traders, and not those who take money freely and fail to bring in goods.”
A state committee that investigates how LCs are used has found anomalies in the way LCs are disbursed in Jonglei state, committee secretary Philip Thon Nyok says.
Nyok says his committee's research showed that only eight traders in Bor received foreign currency through the LC program. The rest of the funds from the LCs went to "different people," some of whom were identified as government officials, Nyok said.
Wuol says he handed out $10-million-worth of LCs to 41 companies in Jonglei state when he was head of a state committee that handled letters of credit. The remaining $20 million was disbursed to 44 companies before Wuol was appointed chair of the LC committee, he says.