JUBA, July 7 (Xinhua) -- South Sudan's Minister of Finance and Economic Planning, Stephen Dheiu Dau has unveiled a proposed 299.9 million U.S. dollar budget for the fiscal year 2017-18 that would soon be tabled before parliament.
The 2017-18 budget is 54 million dollars higher than the FY 2016-17.
According to Dau, the resources available to fund the budget are 191 million dollars at an estimated rate of 155 SSP per one dollar, leaving a deficit of 108 million dollars.
The key priority areas for the government will be spending on salaries and transfers which constituted 62 percent of the budget, rising funding for peace, avoiding borrowing the central bank, strict budget control among others.
"The budget was approved earlier by the cabinet but there was an issue of formation of the leadership of the budget committee in the parliament which has been resolved recently. We wanted it to be consistent with other countries of the East African Community," he said.
War-torn South Sudan depends on oil export for 98 percent of its revenue, but production reduced significantly due to the civil war that erupted in December 2013, causing most oilfields in the country's oil-rich northern region to shut down.
The East African nation is currently struggling with hyper inflation amid shortage of foreign reserves to support its import-dependent economy.
The finance minister said the net oil revenue available to fund the 2017-18 is estimated at 166 million dollars, which is just 20 percent of the country's gross revenue.
Dau said the deficit would be covered by implementing the 2017-2018 Tax Amendment Bill which proposes new measures to boost non-oil revenue collection, tougher financial regulations and increased borrowing from Treasury Bills.
The new targets include increasing airport departure tax from 20 dollars to 30 dollars, raising sole proprietor income tax by 5 percent and establishing a revenue authority to reform tax collection and public financial management.
The government also seeks to raise 19.3 million dollars from new borrowings in Treasury Bills in the next fiscal year and ensure strict financial control regulations.
As one of the major economic reform policy, Dau said he will ask the parliament to partially scrap fuel subsidies to reduce the cost of supplying fuel by the state oil firm which is estimated to spend 183 million dollars on fuel subsidies annually.
"Ending the ongoing conflict and ensuring sustainable peace would provide conditions to attract foreign investment and development financing which are necessary to increase supply of foreign currency and the local currency and reduce inflation," Dau said.