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AP/Pete Muller
Hold the champagne.
SOMBER

The world’s youngest country is canceling its independence day celebrations

By Yinka Adegoke

South Sudan, which became a sovereign state on July 9, 2011, is canceling all plans to celebrate the five-year anniversary. And it’s easy to see why.

The country is embroiled in a bitter civil war since 2013, which has seen tens of thousands of people killed and millions displaced. The conflict is continuing despite the fact the leaders of both sides—president Salva Kiir and first vice president Riek Machar—signed a peace agreement 10 months ago. Machar returned to South Sudan’s capital city, Juba, in April.

Crucially though, the economy is in freefall. South Sudan depends on oil exports for over 90% of its government revenue, so with oil prices down by more than 50% for much of the last 18 months, the economy has taken a hit. The nation faces a budget shortfall of between 40 and 60%, according to various estimates. Economists warn of hyperinflation; the South Sudanese pound has lost over 80% of its value against the dollar.

“We decided not to celebrate the July 9 Independence Day, because we don’t want to spend that much,” Michael Makuei, the minister of information, told reporters on Tuesday, according to al-Jazeera. ”We need to spend the little that we have on other issues.”

The International Monetary Fund (IMF) warned the country of further deteriorating economic situation unless quick economic reform policies were adopted and political environment eased.  It said the current approach means the deficit in 2016-17 could top $1.1 billion, or 25% of GDP.