South Sudan’s central bank took steps to bolster the economy amid the COVID-19 lockdown, but an analyst warned the economy will only improve after the government restores peace and security. The central bank lowered interest rates from 13% to 10% and lowered the cash reserve ratio from 15% to 10% to reduce economic hardships on individuals and businesses during the pandemic. The cash reserve ratio is the minimum fraction of total deposits from customers that commercial banks must hold in either cash or deposits. The measures are meant to reduce the overall cost of financing for the private sector and release additional cash to commercial banks, which should help spur economic activity during the COVID-19 pandemic, according to Bank of South Sudan Governor Gamal Abdalla Wani. “The Bank of South Sudan deemed it necessary to suspend circular No. SDR/S/4/2020 that directs all banks to raise their paid capital to a minimum of five billion South Sudanese pounds for a period of six months.”
SOURCE: VOA
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