“The reason we don’t pay the arrears is that the oil money goes towards paying off loans taken earlier and paying some of the government’s priorities,” he told reporters in Juba, the capital. “Where am I going to get the money if the oil is sold ahead until 2027?”
The government will allocate oil sales for 2028 and beyond to pay for this year’s salaries, he said.
The Treasury Department recently paid the November and December salaries, but is now in debt for the first four months of 2022.
President Salva Kiir’s government relies on oil revenues to pay salaries and fund other development projects. Internal sources of income are not sufficient to support government spending.
But the government has borrowed heavily against the country’s oil exports. In 2019, authorities agreed to allocate 10,000 barrels of crude oil per day as payment to Chinese companies building roads in the country.
Some expenses are seen as licentious. A 2018 decision to give each of the country’s 400 lawmakers a $40,000 loan to buy personal cars was widely criticized in a country where most government employees live in relative poverty. Medical workers are among the least paid, with most nurses and midwives earning less than $100 a month.
Some government officials who spoke to The Associated Press said they are finding it difficult to provide for their families amid rising commodity prices in Juba and elsewhere.
“Food is expensive and children burden us with school fees,” said a messenger from the government office, Tereza Akol. “Our situation is bad.”
Akol said she has not received payment since January.
Mary Poni, who works as a cleaner at a government office, said she now has a part-time job as a greengrocer to put food on the table. “How can you serve a government that doesn’t care about you?” she said.
Kiir last year instructed financial authorities to allocate 5,000 barrels of crude oil per day to regularize salary payments, but that has not yet been implemented.
South Sudan produces 3.5 billion barrels of oil annually. According to official figures, monthly oil revenues of about $57 million cover only a fraction of the government’s monthly expenditure of $200 million.
Achuil, the finance minister, gave no details about the national debt last week.
Some government critics accuse the government of borrowing corruptly, as many are taken out without parliamentary approval.
“These loans are very corrupt because a lot of money is being exchanged under the table,” said Peter B. Ajak, an economist who previously worked for the government. “That’s why money from five years has already been spent.”
There were high hopes for peace and stability in South Sudan when the country gained its long-won independence from Sudan in 2011. But the country plunged into civil war in December 2013, based largely on ethnic divisions as forces loyal to Kiir fought those loyal to his deputy chairman Riek Machar.
Tens of thousands of people were killed in the civil conflict that ended with a 2018 peace agreement that reunited Kiir and Machar into a national unity government.
But oil production in South Sudan has not yet fully recovered.