Embattled South Sudan joins IMF, World Bank

S Sudan\'s Minister of Finance Ngai (left) as he signs the treaty to become IMF\'s newest member South Sudan, the world\'s youngest nation, joined the World Bank and the International Monetary Fund on Thursday, amid rising concerns that border clashes with Sudan may escalate into war. One of the world\'s least developed countries, the impoverished African nation achieved independence from Sudan only last July after more than two decades of war.
South Sudan\'s entry into the two multilateral financial institutions comes as each side accuses the other of fomenting unrest along their border.
Sudan\'s economy is in crisis after the loss of oil revenue following South Sudan\'s separation.
In signing ceremonies at the IMF and World Bank headquarters in Washington on thursday, South Sudan\'s finance and economic planning minister, Kosti Manibe Ngai, completed the country\'s bid for membership begun in April 2011.
\"Even before we became members, the World Bank has already been collaborating closely with us,\" he said.
\"So today we are very pleased that the formalities have finally been completed, and we look forward to a long-term partnership with the World Bank Group as we work together on the much-needed development of South Sudan.\"
South Sudan became the 188th member of the sister institutions just in time to join their spring meetings this week in the US capital.
IMF managing director Christine Lagarde welcomed South Sudan to the global lender, saying \"the IMF will do its best to assist the country in setting up the foundations for economic stability and growth in the period ahead\".
South Sudan had approached the IMF for technical assistance in building the capacity and institutions to manage its nascent economy.
The IMF is coordinating with donors in a dedicated $US11 million ($10.6 million) trust fund in support of South Sudan over the next four years. \"The European Union plans to come on board as a lead donor,\" it said.
The World Bank, an anti-poverty development lender, also hailed South Sudan\'s membership, calling the impoverished country a \"test case\" on its principles of citizen-led state building with the support of international development partners.
\"I am very pleased to welcome South Sudan, the world\'s newest country as our newest member of the World Bank Group, to help it manage and resolve its many formidable development challenges while it also builds a broad national coalition to secure lasting peace and prosperity,\" said Obiageli Ezekwesili, the bank\'s vice president for Africa.
She also pledged the bank would support the fight against corruption, promote accountability and good governance, and work closely with South Sudan and its communities \"for better social and economic development\".
The World Bank has been engaged in South Sudan\'s development since 2005, through a trust fund funded by the bank and 13 donors that has disbursed about $US505 million.
Slightly larger than Ukraine, Thailand or Spain, South Sudan has few roads or infrastructure. Its child and maternal mortality rates, and primary school attendance, are among the worst in the world.
Ahead of South Sudan\'s independence on July 9, 2011, the bank established a $US75 million South Sudan Transition Trust Fund to help provide health care, infrastructure, and employment.
The World Bank Group said it was working closely with the Government and stakeholders in South Sudan to develop a new two-year partnership strategy critical to supporting South Sudan\'s development.
The opening doors for the country\'s progress came against the backdrop of rising international fears about the conflict between Sudan and South Sudan.
Clashes broke out last month in the Heglig area and escalated last week with waves of aerial bombardment hitting the South and South Sudan\'s seizure of Heglig on April 10.
The United Nations, the United States and the European Union have criticised the South\'s occupation of Heglig, the north\'s most important oil field, equally denouncing Sudanese air strikes against the South.
Yesterday, the UN Security Council discussed possible sanctions against the two neighbours.
Sudan and South Sudan are locked \"in a logic of war\" with hardliners controlling both countries, international peace envoys told the council.