Saturday, August 27, 2011

Inflation

When I first arrived in Juba in May, 2010, one US dollar was worth officially 2.3-Sudanese pounds, though you could get 2.5 in the marketplace. Later the rate crept up to 2.6, where it remained for some time. But since the referendum in January 2011, the rate started creeping up with the prospect of an independent South Sudan. 2.8 was reached and passed as was 3. I was just trading at 3.5, but now I've heard the bank rate (usually not very good)is officially 3.6, which means you should be able to get as much as 4 from the private exchange people in the marketplace.
The net effect of this is to make Juba an increasingly expensive place to live. Juba was already expensive, since there is no local production of anything, save some bottled water and White Nile beer, which means everything has to be trucked-in. Very little in the way of fruits and veggies is grown locally, which is a shame since the land is fertile. But folks here are discinclined to grow things, and production on a large scale is hard because transportation is practically non-existent or terribly expensive. You could grow the most lovely crops in the world but if you have no way to get them to market what good does it do you?
The impact is felt most, of course, on the poor who in Sudan already had a hard enough time of things. And while wages here are high, they are not high enough nor keeping pace with inflation, which makes living hard on folks. There are also problems of fuel shortages, especially vehicle fuel, and long lines at petrol stations are the norm. I was lucky last week to find a station way out at the edge of Juba (in Rejaf) which had fuel and no long line. Some places, especially those towns to the north that depended upon shipments from Khartoum for their foodstuffs, are suffering terribly because the northern Sudan government will not allow shipments to the south. Cities such as Malakal are simply without food, regardless of the cost. There is real hunger in a lot of places.
Anyway, hopefully the high prices will encourage local production which should, in time, reduce prices. But it will be very difficult for the time being, and it is very expensive to be here.

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