Dollar exchange rates increase in Sudan

Sudanese Pounds (File photo: Andrew Bergman / RD)

The exchange rate of the US Dollar against the Sudanese Pound recorded a significant increase following a rise in the demand this week – while a sharp decrease in exports since war broke out in the country on April 15 has further led to a shortage of hard currencies.

The dollar rate in the parallel market yesterday rose to SDG700 while it reached an average of SDG618 at the banks in the country.

Leading economist Haisam Fathi told Radio Dabanga yesterday that the increase is mainly due to the growing number of Sudanese who plan to leave the country, especially after the government in Port Sudan announced the resumption of the issuance of passports last week.

Years before war erupted between the Sudanese army and the Rapid Support Forces (RSF) nearly five months ago, the country was already suffering from a large shortage of hard currency.  

“Since the war, the exports sharply decreased and imports via border trade with neighbouring countries grew significantly. This caused an even higher shortage of dollars,” Fathi said.

“The Sudanese authorities should cooperate with these neighbouring countries in order to stabilise the Sudanese pound rate.”

Fathi predicted the already soaring inflation to increase “unless the situation is remedied by the facilitation of exports and the stimulation of increased production outside the war zones”.

Drop in revenues

The economist warned that the Minister of Finance’s recent decision to reduce mining profits taxes from 30 to 15 per cent will reduce the country’s revenues.

He also noted the positive aspect of the decision, as it “will lead to more investments and attract mining companies, thereby increasing profit and employment rates in Sudan. In light of the current situation, Sudan is in dire need of increased revenues, and the mining sector is the only entity operating outside war zones.”

Financial analyst Abdelazim El Amawi last month warned of a 70 per cent drop in Sudan’s revenues, owing to the dire economic consequences of the war.

He pointed to the war-ravaged industrial sector, which represents 21 per cent of the country’s economy, saying that the 85 Sudanese factories in Khartoum have been completely debilitated as a result of the battles.

In mid-July, Sudanese economists estimated the economic losses caused by the war so far at $9 billion, or roughly $100 million per day. The value of property and goods plundered was estimated at another $40 billion.