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South Sudan seeks budget hike after army overspend
15 Oct 2008 18:11:20 GMT
Source: Reuters
By Skye Wheeler

JUBA, Sudan, Oct 15 (Reuters) - South Sudan's finance minister on Wednesday asked lawmakers to approve a supplementary budget equal to almost two-thirds the original plan largely because of overspending by the armed forces.

Both the semi-autonomous south and the north, which signed a peace deal in 2005, have been building up their armies with a number of possible flashpoint events on the horizon.

Finance Minister Kuol Athian told South Sudan's parliament it needed to cover another 2.08 billion Sudanese pounds ($980 million) of spending on top of the 3.4 billion Sudanese pounds already included in the 2008 budget.

The minister later told Reuters the biggest over-spender was South Sudan's army, which had burned through a budget of nearly 1 billion pounds by June.

South Sudan's national budget has been weighed down by the running costs of the large standing army it has maintained since signing the peace agreement that ended more than two decades of north-south civil war.

Athian told Reuters the 61 percent budget increase he wanted could be covered by a surge in the region's oil revenues in 2008. Oil revenues account for 99 percent of government income.

A recent fall in global oil prices could have a serious impact on next year's spending plans, Athian added.

"It will affect our budget for next year," he told Reuters. The budget for 2009 would be worked out on the assumption of an oil price of $75 a barrel, he added. U.S. crude fell on Wednesday to a 13-month low of just over $75.

Overall, South Sudan's government spent 70 percent of its budget by June, said Athian. Government departments exceeded budgeted spending in a range of others areas, including telecoms and food stores, he added.

South Sudanese parliamentarians are due to vote on the supplementary budget request within the next two weeks.

The seizure by Somali pirates of a shipload of tanks that many believe were destined for South Sudan has highlighted the arms build-up in the region.

South Sudan has said the tanks were not for its forces and Kenya says they were meant for its forces, but the U.S. navy, diplomats, maritime officials and the pirates have said they believe they were meant for south Sudan.

Sudan's Khartoum-based government summoned Kenyan and Ethiopian ambassadors this week to protest against what it said were illegal arms shipments to the south. (Editing by Matthew Tostevin)


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