JUBA, Sept. 27 (Xinhua) -- Africa Export and Import Bank (Afreximbank) said Thursday it has extended 90 million U.S. dollar credit facility to support South Sudan's 2018/19 budget.
Benedict Okey Oramah, Afreximbank president, said the two-year trade finance facility will be repaid from the oil revenues and is guaranteed by Trinity Energy Limited, a South Sudanese company specializing in petroleum products and related services.
Salvatore Garang Mabiordit, minister of finance and economic planning said the funds will be used to facilitate trade and developmental projects, support the budget and finance social benefits and humanitarian disaster management programs.
In August, South Sudan's parliament approved a budget of 585 million dollars for the 2018/19 fiscal year, an increase of 75 per cent from the previous period. The budget is expected to be partly financed by external creditors and donors.
South Sudan depends more than 90 percent on oil revenue to finance its fiscal budget and in a bid to widen its tax base in the non-oil sector, it established the 2017-2018 Tax Amendment law which helped boost revenue collection amid tougher financial regulations and increased borrowing from Treasury Bills.
This development led to the introduction of the airport departure tax which has since risen from 20 percent to 30 percent helping to replenish the Treasury.
South Sudan in May also lifted the fuel subsidies in a bid to cut spiraling public expenditure costs in the youngest nation that has in the past experienced rampant fuel shortages due to conflict.