You are currently viewing Sudan declares state of economic emergency due to currency decline

Sudan declares state of economic emergency due to currency decline

On Thursday, September 10, 2020, the Sudanese government declared a state of emergency on its economy after linking the sharp decline of its currency in past weeks to “Systematic vandalism.” This comes is a time when the government announced that it allocated more than 150 million Sudanese pounds ($2.73 million) to help victims of record Nile River flooding that has left tens of thousands of people homeless.

The government is making it its top priority to curb the activities of illicit traders and smugglers which has cost the country billions of dollars per annum.

According to Africa’s Organised Crime Index (OCI), Sudan ranks 6th in the Index for criminality, with high scores for multiple criminal markets and criminal actor types. This is mostly due to its role as a major transit country for arms trafficking, human trafficking, human smuggling and the illicit trade in non-renewable resources. 

Crude oil is Sudan’s key foreign earner and its economy depends heavily on the oil sector. But the challenge with the sector and the Sudanese economy at large is traced to the under reporting of its global trade transactions, a report shows. 

Within the seven-year period 2012-2018, Sudan reported exports of 62.3 million barrels, while the country’s trading partners reported imports of 112.2 million barrels. This reveals a volume gap of 49.9 million barrels and equivalent to 80.1 percent of Sudan’s declared export volume.

In the gold mining sector, the report also indicated heavy under-reporting of exports. Between 2012-2018, the Central Bank of Sudan reported 205,446 kilograms of gold exports, whereas the country’s trading partners reported 404,732 kilograms of gold imports, creating a volume gap of 199,286 kilograms (200 tons) of gold, equivalent to 97 percent of Sudan’s declared gold exports by volume.

Experts noted the presence of established criminal networks, state-embedded actors and foreign actors, all of which contribute to organised crime. Sudan scores relatively poorly on resilience, ranking 38th in Africa, even though some indicators are deemed to be moderately effective. The failure to address organised crime appears to stem mostly from lack of political will, undoubtedly influenced by high levels of involvement of state officials in illicit trade flows. 

This could be traced to the previous government’s disposition towards the subject. During the government of ousted President Umar Al Bashir, Sudan became a safe haven for dangerous crime networks. However, the government has pledged to set up special courts in the next days to fight smuggling and other illicit activities undermining its economy.

Source: venturesafrica.com