Sudan says to circulate new currency this month

Reuters, Saturday 16 Jul 2011

New money is a 'precautionary measure' for Khartoum following southern independence, says central bank head

Sudan's central bank said on Saturday it would begin circulating a new currency this month after South Sudan said it planned to create a currency of its own.

South Sudan, which declared independence on 9 July under a 2005 peace deal that ended decades of civil war, said on Monday it would begin circulating its previously announced South Sudan pound in the coming week, pegging it one-to-one with Sudan's existing pound .

Sudanese Central Bank Governor Mohamed Kheir al-Zubeir, asked when the north's new currency would go into circulation, told reporters in Khartoum, "Before the end of this month."

He added that the replacement of currency would take "maybe two to three months. We have good experience in that."

The new currency is a "precautionary measure" following the South Sudan plans for a separate currency, he said.

The Sudanese pound has been falling on the black market in Khartoum for weeks as economists say foreign currency inflows needed for imports will decline alongside falling oil revenues.

The south took about 75 per cent of Sudan's 500,000 barrel-a-day oil reserves with it when it left.

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