Kenya's Co-operative Bank sets up shop in South Sudan - Reuters Africa

JUBA Aug 14 (Reuters) - Kenyan lender Co-operative Bank and South Sudan have launched a bank in Africa's youngest nation to benefit from government plans to boost local food production.

The Nairobi-based bank has set up the Cooperative Bank of South Sudan in which it will hold a 49 percent stake, officials said on Tuesday without giving any financial details.

South Sudan owns the rest, of which it will it sell 11 percent after three years.

Officials said the bank would help farmers sell products as South Sudan, with the help of the United Nations, expands agricultural production to overcome food shortages.

"It is only through the bank that we will be able to support the farmers. When the government does not have money, the bank will have the resources to support the farmers," agriculture minister Betty Achan Ogwaro told Reuters.

While South Sudan is one of the world's least developed countries with few people having a bank account, several foreign banks have arrived including Kenya Commercial Bank, Qatar National Bank and a bank funded by Dubai Islamic Bank.

South Sudan is undergoing a severe economic crisis but business prospects have improved since the government reached an agreement with Sudan on how much it should pay to export oil through the north. No date has been set to resume exports.

In January, the government shut down oil production which contributed 98 percent of state revenues after failing to agree a transit fee with Sudan. (Reporting by Mading Ngor; Writung by Ulf Laessing; Editing by Dan Lalor)