Journal of Finance and Investment Analysis

Does Investment Incentives Mediate the Relationship Between Government Revenue Management Practices and Financial Sustainability? Evidence from Oil Resources in South Sudan

• [ Download ]
• Times downloaded: 12

• Abstract

   

  The financial sustainability of oil resources is a critical issue for resource-rich developing countries like South Sudan, where the management of oil revenues plays a pivotal role in national economic stability and growth. The study's objective was to determine the mediating effect of investment incentives on the relationship between government revenue management practices and financial sustainability of oil resources in South Sudan. A descriptive longitudinal research design was adopted, utilizing secondary data collected from 2012 to 2023 from sources such as the Central Bank of South Sudan, the Ministry of Petroleum (MOP), the Ministry of Finance and Planning (MOFP), the World Bank Report and the International Monetary Fund (IMF) and analysis by regression models. The findings revealed that investment incentives mediates the relationship between government revenue management practices and financial sustainability of oil resources in South Sudan, suggesting that strategic incentives enhance the benefits of revenue management practices (R² = 0.3412, p<0.05). The study concludes that effective government revenue management, supported by strategic investment incentives are essential for the financial sustainability of oil resources in South Sudan. This study aids industry stakeholders in developing best practices that ensure the sustainable extraction and sale of oil resources, the findings can shape the development and refinement of national strategies and regulations pertaining to the oil sector and the study enriches academic literature on the dynamics of resource-rich economies. Based on the findings, the study recommends that policymakers in South Sudan prioritize the implementation of robust fiscal policies that enhance the efficiency of revenue collection and ensure transparency in public expenditure. Specifically, the government should establish an independent fiscal oversight body tasked with monitoring oil revenue management and ensuring that revenues are allocated and spent in a manner that supports long-term economic stability.

   

  Keywords: Government revenue management practices, investment incentives, financial sustainability, oil resources in South Sudan.