South Sudan inflation jumps 57pc in August on food prices

South Sudan became independent on July 9 under a 2005 peace agreement with its former civil war foe Khartoum but has been struggling to build up state institutions and contain tribal and rebel violence killing 3,000 people this year.

Month-on-month inflation accelerated by 9 percent in August, driven by higher cost for fish, sugar, cooking oil and some fresh meat products, the national statistics bureau said in a statement obtained on Monday.

On an annual level, inflation hit 57.1 percent in August due to a jump in the rise in cost of food and non-alcoholic beverage -- the biggest component in the consumer price index -- by 63.9 percent

Last week, the United Nations warned Sudan would face food shortages from next year as agricultural production was hit by violence and heavy rains.

Information Minister Barnaba Marial Benjamin said prices would ease by December as supplies would improve after Juba signed a border agreement with Khartoum to open ten border crossings earlier this month.

Borders between north and south were closed before Juba's indepenedence.

"We used to get most of our finished goods from the north so when they closed the borders (in May), they caused a shortage in the market. There were few goods so the prices went up," Benjamin said.

"(There) was the rampant marketing in black market hard currency in the beginning - our currency was not pegged at the proper rate. Our central bank has properly fixed it," Benjamin said.

Trade would also increase with east African neighbours Uganda, Kenya and Ethiopia, he said.

Copyright Reuters, 2011