Analysis: Post Sanctions & the Sudanese Economy
Sudan doesn’t require reform but rather a complete transformation. – Dahd Kamil Idris*
The lifting of trade and financial sanctions against Sudan created such a great sign of détente between Sudan and the United States.
Sudan, heir of an ancient culture, located at the strategic crossroads between Africa and the Middle East. A vast area of fertile lands, abundant life stock and immense and yet mostly untapped natural resources, has been burdened by conflict for much of its independent history. Among those conflicts are the extreme violations of human rights, the suffering of double-digit inflations, political uncertainty and economic sanctions, which in turn caused a chronic lack of foreign direct investment.
The lifting of the sanctions, after being imposed for more than two decades, raises questions such as what this means for the Sudanese people, their country and its economic growth. Currently, Sudan is burdened by a foreign debt of nearly 50 billion USD which is adding more to the struggle of attempting to lift large numbers of its populace out of poverty. In addition to this enormous debt, as part of the secession, Sudan agreed to be responsible for South Sudan’s pre-secession debt. Sudan is now more than qualified to seek relief with regards to its debt from the ‘Heavily Indebted Poor Country Relief’ (HIPC) which has a strong role in ‘Relieving The World’s Poorest Countries Of Unmanageable Debt Burdens’. However, Sudan must take the necessary steps to start the process which has been delayed by the ongoing conflicts and sanctions, that now have been lifted. The Sudanese authorities agreed with South Sudan to undertake these necessary steps.
The economy has struggled immensely since before the beginning of the wars which commenced in 1983, the first war began between the central Sudanese government and Sudan’s People’s Liberation Army. The Civil War then spread to Darfur, the Nuba Mountains and the Blue Nile area. This contributed greatly to the secession of South Sudan.
These events have led to a turmoil of conflicts and related issues, not only for the economy but towards the social lives, cultural integrity and ethnic relations for the entire Sudanese nation as a whole, including the South.
In 1995, due to the war, there were approximately 3 million internally displaced persons, a great number of which are children. In Khartoum (the capital alone) there are approximately 25,000 homeless street children. The government started violently removing them into police stations, deciding their dismal fate. This was hugely, and rightly so, criticized by many human rights organizations and activists.
In 1999, for nearly a decade, the economy was thriving, as a result of crude oil exports and some inflows of limited foreign direct investment devoted to the oil sector. However, with South Sudan’s secession in 2011, the economy took a devastating hit, where Sudan lost about 3/4 of the oil, 2/3 exports and half of fiscal revenue.
Sudan was perceived once upon a time to be the breadbasket of Africa, having the largest united agricultural project worldwide, ‘Al Giezra scheme’ (مشروع الجزيرة). Sudan’s agriculture account for 1/3 of total GDP. The country gained its independence in 1956 and joined the World Bank in 1957. The first World Bank mission visited Sudan in 1958, the financing of the expansion of the Gezira Scheme was on the top of the list of the priorities of the then Government. Unfortunately, later on, due to mismanagement, lack of technical supervision, and insufficient modern application of technology coupled with violations of farmers’ rights, the project continued to deteriorate. It reached the peak of declination during the time of the current government.
Sanctions imposed by the United States and other international parties only added to its crippling efforts towards a revival of the economy. As an attempt, there were several projects unrelated to petroleum, for a means of resource revenues, such as gold mining and Austerity programs in order to increase, in particular, the foreign reserves of the country.
The lifting of the sanctions per se has not lead to improvements in the economy nor did it contribute to the betterment of the standards of living of the Sudanese people. The value of the Sudanese pound in relation to foreign currencies has been weakened drastically, currently, 1 USD is equivalent to 40 Sudanese pounds. All measures attempted by the government and the Central Bank of Sudan failed to restore the strength of the local currency. The situation provoked the government to continue printing the local currency without having any gold cover. The rate of inflation went up and basic commodities like foodstuffs became extremely expensive making it practically impossible for people to lead normal lives. In the meantime, mismanagement and corruption, including the institution of corruption continue, thus Sudan became at the top of corrupt countries worldwide.
Taking all this into consideration, possible solutions are underway. Specifically, a strong candidate for the presidency of Sudan, Professor Kamil Idris, a Sudanese statesman, scholar and international civil servant, has serious plans to transform the country and put it back into its legitimate leading position in the international community. Some of his plans include new ideas. The country should not solely depend on animal resources, agricultural products and mining. Professor Idris’s intention is to diversify the economy through rebranding the cooperate image of the country. He refers to it as ‘demystification of Sudan’. His top priority is to identify new projects that would capacitate the country to sell services. In addition, he would provide intelligent incentives to attract foreign direct investment into Sudan. Expressions of folklore, traditional knowledge and genetic resources would attract the entire world to have productive partnerships with Sudan. He states that to fight corruption, it is necessary to adopt legislation and implement law enforcement mechanisms. At the international level, he would encourage the international community to lift the name of the country from the terrorist list and write off its foreign debt.
To sum up, the political and economic status of Sudan urges a change within the government, Sudan deserves a leader who is focused on the country’s best interests which includes sustainability of the economy. However, the people play a large role in potential change, there must be more belief within the powers that lie behind people in numbers. There is a big hope for Sudan that owns the most fertile lands, the richest animal resource, the longest river on earth planet (the river Nile), the most valuable minerals as well as the most historic civilization in the area. The Sudanese people are aspiring for positive change and better lifestyles, not only from a political perspective but also, educationally, socially, health-wise and of course economically.
*Dahd Kamil Idris is a Swiss National (born and raised in Geneva) of Sudanese origin, currently doing her masters in international relations and diplomacy. She has the background in the fields of Medicine & Physiological sciences. She plans to specialize in International law and International relations, with some emphasis on Global Health.
The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views of The Kootneeti Team.