Yanyyom, a subsidiary of Alok Group of companies, one of the few manufacturing businesses in South Sudan’s capital Juba, has been forced to shut down owing to the poor business environment, according to the company’s majority shareholder.
The company which produced bottled water had already suspended its production more than a year ago for administrative reasons but it has been unable to resume owing to the shortage of hard currency to buy imported materials necessary for the prodution.
Speaking on Sunday, majority shareholder Garang Deng Aguer said, “We were forced to suspend our activities first by administrative matters but when these administrative issues were resolved and the management sought to restart from afresh, we realized the market was undergoing a difficult situation.”
“Dollars to import products and services which are not locally available in South Sudan became an issue. We had to think what to do but we were unable to get access to pay for imports so that we could maintain key business activities and operations of the company,” he explained.
The company’s initial suspension and eventual downfall highlights the crippling effects of the ongoing conflict on the economy. Economists predict the economy will contract significantly this year.
Garang said his businesses were able to get hard currency before the eruption of the conflict, although it was not easy getting desired amount. “Before the current conflict, it was possible to get dollars in the commercial banks and even directly from the local markets at affordable prices. Indeed it was manageable. But now there is a real challenge,” he said.
He said he was one of the prominent business figures who had difficulties getting letters of credit. He explained that businessmen who cannot access letters of credit tend to turn to the black market for dollars, where the cost is more than three times the rate offered by the central bank.
This results in higher consumer prices because the businesses want to recover the loss through selling commodities at higher price.
Garang said the only way of resolving the situation was to stop the war and bring peace to the country. “There is no another alternative to resolving this situation. The situation can improve if peace comes. So it is the desire of everybody that peace must be given a priority focus to come.”
“And it was important that the president made it very clear that one of the primary objectives of his government during the period of three years which the assembly has given to him would be to work for peace to come to the country so that this suffering is stopped and people pay attention to development.”
Yanyyom Mineral Water and Beverage Factory takes its name from Lake Yanyyom, located near the president’s hometown Akon in Warrap State. Radio Tamazuj previously reported that Salva Kiir’s wife Mary Ayen was a shareholder in the company but withdrew her investment several years ago.