South Sudan borrows $200 million as oil production slows

Juba, May 28, 2014 (SSNA) — The Government of the Republic of South Sudan said it has borrowed $200 million dollars from oil companies that operate its oil fields, adding that it plans to delay “repayments on domestic loans”, the US-based newspaper, the Bloomberg reported.

Finance Minister Aggrey Sabuni did not provide the names of the companies that provided loans to Juba.

But, government source who prefer anonymity told the South Sudan News Agency that the loan was provided by at least one Chinese company. The SSNA cannot independently verified the claim.

The production of crude oil has been limited by the ongoing fighting in the country, forcing oil companies to reduce the size of their employees.

“South Sudan borrowed $200 million from oil operators and postponed repayments on domestic loans after the country’s six-month-old conflict cut crude output, the government’s main source of revenue”, South Sudanese Finance Minister Aggrey Tisa Sabuni, was quoted as saying by the Bloomberg.

Minister Sabuni described his government reliance on oil as a “very highly risky situation”.

South Sudan depends heavily on oil revenues and many regional analysts warned that the young nation’s economy could collapse without warning.

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