THE INFORMAL SECTOR IN SOUTH SUDAN

According to the IMF Global Economic Outlook in January, South Sudan’s economy was projected to have gained a real GDP increase of 5.6% in 2023 compared to the previous year.


As of this year, South Sudan’s GDP was reported to be $8 billion, with a population of 15 Million people—most of whom being youth and women, as inflation continues to bite at an average rate of 21.7% across the country.


THE INFORMAL ECONOMY IN SOUTH SUDAN


It’s unfortunate the economy of the newest country in the world is hugely informal and heavily relies on humanitarian assistance, Imports and limited government opportunities due to conflicts, flooding and Opaqueness of and zero accountability of resources in public institutions at all levels of Government.



The Informal sector in South Sudan accounts for 80% of its GDP——Sector is also responsible for almost 96% jobs in the market across South Sudan.


However, Revenues coming from the sector’s investments rarely make the Commissioner General a happy man at the National Revenue Authority (NRA) in Juba. The tax authorities including the NRA have not been able to effectively record or grasp the exact statistics on revenues tax-evaded by tax payers in the Sector every single day that usually creates a deficit in the revenue books of accounts.



REASONS FOR FORMAL ECONOMY


The government of South Sudan must ensure The Informal Sector is penetrated into and finally shifted to the formal arena so that government is able to raise more taxes, hence financing its flagship projects across the country with tax payers funds.


Following are the top five (5) advantages of turning informal businesses into formal enterprises regulated by the government of South Sudan; 


-Wider Tax Base

-Smooth NRA Policy Transition

-Limited dispute resulting from Tax Evasion

-Accountable distribution of business incentives

-Improved labour force


CONCLUSION


While the government and NGOs all together failed in improving lives and livelihood of most people by subjecting people to only relieved aid and stuff from foreign humanitarian organizations, I call out the government of South Sudan to urgently reform its institutions and adopt policies aimed at enhancing tax mobilization so as to improve lives or standards of living mainly for people living in rural villages through provision of clean water, better education and healthcare.


There is also a need the National Revenue Authority (NRA) is provided with an environment favorable to mobilize and administer non oil revenues in South Sudan without threats, intimidations whatsoever such that there is excess funds to support government activities leading to economic growth that in turns improves the proportion of non oil revenues to GDP ratio in South Sudan.

Comments

Post a Comment

Popular posts from this blog

Understanding Public Sector Accounting in South Sudan

WHAT IS PUBLIC SECTOR ACCOUNTING? The term “Public Sector Accounting” refers to a process of learning, recording, analyzing, interpreting, and communicating financial documents, accounting tools and regulatory acts as used at all levels of government by Accounting practitioners in public institutions, South Sudan. In South Sudan, a Fiscal Year begins on 1st July, and ends on 30th June, in the following year. OBJECTIVES OF PUBLIC SECTOR ACCOUNTING The aim of South Sudan’s government is not to make profit, but to render essential services like Health, Education and Transport to South Sudanese. The Public Sector Accounting can be used to measure revenues (oil revenues and non oil revenues) against state expenses. It can also be used for budgeting, planning and forecasting. Therefore, the overall objectives of the government accounting in South Sudan are as below; reference for accountability tool for budgetary planning & control tool for an objective budgetary reporting provides basis...
Read more

South Sudan: The Climate Change & Green Bankers

The Climate Change has two sides of a coin. It is either; (1) a threat to our lives, or (2) a surety for our future generations free from environmental shocks and Carbon-Related complications or any other forms of external mutation.  For this reason, the Global Warming—currently at (2.0 Celsius) automatically becomes one of the biggest African Problems of our times in the 21st Century, which nevertheless, commanded our collective attention, increased resource mobilization leading to renewed calls for Greener-Financing or Greener-Banking initiatives to reduce emissions to (1.5 Celsius) or lower in the World. The Climate Change in South Sudan Unfortunately, From the last quarter of 2019, towards Covid-19 Pandemic through Flooding, through Ukraine war today, the Climate Change has been paranoidly waking us from a decade long deep sleep and will continue to wake us at the cracks of every dawn in South Sudan from climate nightmares as; Flood, Drought, rising water levels, S...
Read more

The IMF: a Shylock of the Last Resort

Following the just published economic report of South Sudan by The International Monetary Fund this January, from which its GDP was reported to be $8 Billion, Current A/c Bal. at $0.01 and outstanding debts totaling $159 Million for all 15 Million South Sudanese population in 2023. It is an improved version of the previous report that can clearly signal that future is bright. It seams South Sudanese government is working towards recommendations that were tailored by the World Bank in 2022 while the IMF stands at the doorstep to debt finance economic recovery pathways and resilience in the country. However, The-To-Do-List that was present to the government of South Sudan in order to restore economic resilience recommended: Macroeconomic reforms i.e. Institutionalization of Public Institutions, stick to stabilization paths, restore FX Rate and taming Inflation. Address drivers of fragility, conflicts & ensuring peace is a prerequisite of an inclusive economic recovery Improve Oil Sec...
Read more