Economist asks government to regulate commodity prices

By Awan Achiek

The transitional unity government has been asked to regulate commodity prices amid run-away inflation in the market caused by the halting of oil production and global external shocks.

Professor Abraham Matoc, Vice Chancellor for Dr. John Garang University of Science and Technology, said the government should intervene in the market to protect low-income consumers.

“There are two ways to stop this. Number one is government intervention to restrict and regulate the prices,” Matoc told the Dawn in an interview on Tuesday.

Matoc said the assumption of a free-market economy can’t prevent the government from regulating prices of commodities in the market.

“Having persistent inflation and inflation is actually created because of free market assumptions, which is not exactly a free market,” he said.

Matoc proposed a change of local currency in order to strengthen the economy.

“I propose the only way to come out of this is to change the currency so that we strike out one zero from 1,000 to 100,” he said.

He attributed the devaluation of the South Sudan Pound against the U.S. dollar to low productivity.

“There is no competition, because there is no productivity, and the issue of supply and demand is not equally working properly in the economy,” Matoc said.

He said that the failure by the government to regulate the market has given way to speculators.

“And therefore, as a market economy, with a few speculators, those who speculate and who like to trade on money, and who like to keep money for themselves, will monopolize the market, and will take all the currency, and this is through black marketing,” Matoc said.

He said lack of restriction has also empowered black marketers to dominate the exchange rate sector.

“The prices are not controlled, and therefore the speculators and black marketers and the dealers begin to monopolize the market. And this weakens the local currency,” Matoc added.