South Sudan inflation eases as food prices decline

JUBA (Reuters) - Inflation in recently independent South Sudan eased in February, driven by a welcome slide in the cost of food and non-alcoholic beverages, official data showed on Tuesday.

South Sudan became independent last July under a 2005 peace agreement with former civil war foe Khartoum, but it has been struggling to tackle an economic crisis and contain tribal and rebel violence that killed thousands last year.

Annual inflation in South Sudan eased to 42.4 percent in February from 47.8 pct in January, and prices fell 3.5 percent on a month-on-month basis, the National Bureau of Statistics said.

It said falls in the cost of health and household equipment helped ease inflation for the second month in a row after it hit a high of 65.6 percent in December.

The government has said inflation may rise in the coming months unless it is able to secure loans to offset the loss of oil revenues after it shut down production in January to protest seizures of its oil by Sudan, from which it split and through which it exports its crude.

Oil makes up 98 percent of state revenues in South Sudan, one of the world's least developed countries.