Faced with a severe foreign exchange shortage, South Sudan's central bank has stopped selling US dollars to the world's newest country's commercial banks.

This substantially restricts South Sudanese letter of credit (L/C) funding which in turn is pushing up the price of the country's much needed imports

Harsh impacts

The central bank began by reducing its US dollar sales to banks to fund L/Cs but has now stopped such sales completely, according to local bankers.

They say this makes it harder for importers to buy goods while it is also impacting on South Sudan's productive sector according to farmers' representative, Mohamed Abbas.

Troubled economy

He told local media that chicken farmers have suffered in particular from a lack of L/Cs for imports required for their activities.

The L/C and foreign exchange shortages are just two aspects of the South Sudanese economy that, despite holding Sub-Saharan Africa's third biggest oil reserves, is facing multiple difficulties including steep consumer price inflation and increased taxation.

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