South Sudan is facing a severe South Sudan cash crisis. The shortage is crippling household spending, paralyzing businesses, and stifling economic activity. Moreover, renewed fighting between government forces and opposition militias has made the situation even worse. Specifically, violence has flared in Jonglei State—north of the capital Juba—further dimming hopes for recovery in the world’s youngest nation.
The conflict pits the South Sudan Defence Forces against the White Army militia, which supports suspended Vice President Riek Machar. Earlier, economic warning signs appeared when war in neighboring Sudan disrupted oil exports. Now, however, fresh clashes have intensified the country’s suffering.
In response, the Bank of South Sudan (BOSS) and its Governor, Johnny Ohisa, acknowledged the crisis. They described it as a period of “severe” economic shocks. Ohisa said the bank will use all available monetary tools to ease the liquidity shortage. “We want to assure the public that we will bring the situation under control,” he stated. Furthermore, he added that the bank will adjust policies based on current conditions.
President Salva Kiir reappointed Ohisa in January 2026. Since then, Ohisa has outlined key monetary measures for the year. For instance, the bank will keep the policy interest rate at 13% annually. It will also maintain reserve requirements at 15% for local currency deposits and 20% for foreign currency. Additionally, banks must hold 20% liquidity against total deposits.
These steps aim to support 5.3% GDP growth, cap inflation at 14.4%, boost private-sector lending, and build foreign reserves equal to 4.5 months of imports. Nevertheless, deep structural problems make these goals difficult to achieve.
South Sudan depends on oil for over 90% of its revenue. Unfortunately, war in Sudan damaged the export pipeline in 2023. Exports stopped in April 2023 and only resumed in January 2025 after extensive repairs. During the shutdown, daily output fell from nearly 160,000 barrels to just 60,000. Consequently, the economy shrank by an estimated 23.8% in fiscal year 2025.
Political instability adds to the turmoil. In fact, President Kiir has reshuffled top officials repeatedly. He replaced the central bank governor, finance minister, and tax chief to consolidate power amid succession tensions. As a result, policy uncertainty has grown, and foreign investors have pulled back.
The World Bank says South Sudan’s recovery hinges on political stability, better governance, and transparent resource management. Yet ceasefire violations and leadership infighting continue to undermine progress.
Meanwhile, humanitarian needs are soaring. More than 10 million people—over two-thirds of the population—now require aid. The UN estimates the country needs $1.7 billion in emergency assistance. Jonglei is one of six states reporting active clashes. Because of this, displacement and food shortages are worsening.
In November 2025, UN peace operations chief Jean-Pierre Lacroix warned the Security Council that South Sudan was entering a “dangerous zone.” He cited rising aerial attacks, broken ceasefires, and infighting among peace agreement signatories.
The transitional government, formed under the 2018 peace deal, is set to end after elections in December 2026. Officials have extended the deadline three times already. However, with violence escalating and the South Sudan cash crisis worsening, stability looks increasingly out of reach.
Ordinary citizens suffer the most. Without cash, markets stall, wages go unpaid, and basic goods vanish. Unless oil flows steadily, leaders commit to peace, and reforms take root, the crisis will likely deepen—pushing more lives toward the brink. Ultimately, without coordinated action, South Sudan risks sliding further into economic and humanitarian collapse.
