South Sudan said Sunday it would cut non-salary spending by around 50 percent as part of austerity measures to compensate for the loss of oil revenues in an oil row with Khartoum.

In January, Juba shut down its entire oil production of 350,000 barrels a day after Sudan started seizing southern oil to compensate for what it calls unpaid fees.

South Sudan needs to export its oil through Sudan but both sides have failed to reach an agreement over fees. Oil makes up 98 percent of South Sudan's state income.

South Sudan's finance ministry said in a statement non-salary spending will be cut by an average of 50 percent, adding that transfers to the ten states would be also slightly reduced.

It gave no figures.

(Reporting by Ulf Laessing and Hereward Holland; Editing by David Cowell)