Oil-backed loans swallowing S. Sudan government's salaries -finance minister

JUBA, May 5 (Reuters) - South Sudan’s government has been unable to pay civil servants for months as the country’s oil revenues are spent servicing oil-backed loans that will not be paid off until 2027, the country’s finance minister Agak Achuil said on Thursday.

In July last year the country’s crude output stood at 154,000 barrels per day (bpd), far less than the 350,000 to 400,000 bpd before the country was plunged into civil war from 2013 to 2018.

Several blocks have already reached peak production and are yielding less output, the petroleum ministry said last year.

Achuil said he found unpaid arrears of more than four months when he took office in November last year.

“The reason why we are not paying the arrears is that the oil is going (towards) the loans which have been taken before,” he said following a visit to Washington. “Where am I going to get the money, if the oil has been sold in advance up to 2027?”

President Salva Kiir and his deputy, Riek Machar, signed a peace agreement in 2018 that ended the worst of the fighting, but implementation has been slow and the opposing forces have clashed frequently over disagreements about how to share power.

Last month Kiir issued a decree integrating Machar’s military officers into a unified command of the army, a central pillar of the peace process.

Despite a relative decrease in violence in the country, around two-thirds of South Sudan’s population, some 9 million people, are thought to be in need of humanitarian assistance, according to the World Bank. (Reporting by Nairobi newsroom; Writing by Hereward Holland; Editing by Alex Richardson)