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Sudan Finance Minister apologises for govt's inability to curb inflation

March 6 - 2020 KHARTOUM
A market stall in Khartoum (File photo)
A market stall in Khartoum (File photo)

In a press conference on Thursday, Sudan’s Minister of Finance offered his apologies for the government's inability to curb the rampant inflation and stabilise the foreign exchange rates. The minister further said that the two options for raising salaries in the country will be discussed as well in ‘community dialogues’.

“The budget is restricted. We need comprehensive policies to deal with the macro-economic situation in the country,” Minister Ibrahim El Badawi explained.

“The lifting of subsidies and stabilising exchange rates are political issues on which consensus will reached during the upcoming Societal Dialogue.”

El Badawi also reacted to the controversy about the US sanctions on the country, after the Central Bank of Sudan (CBoS) mistakenly announced in a press statement on Wednesday that the USA have suspended all forms of economic sanctions imposed on Sudan.

He said that the news on Wednesday led to a drop in the exchange rate of the US Dollar to 85 Pounds on the parallel market, after it reached SDG 117 on Tuesday, and pointed out that the price of the Dollar depends on speculation and on good and bad news, as well as on the extent of Sudan’s trade balance deficit and loss of assets.

Mohamed Bakri from the Central Bank of Sudan (CBoS) reported that the bank continues to receive letters from the Office of Foreign Assets Control (OFAC) of the US Department of the Treasury.

“So far, the Bank of Sudan has been dealing with one financial outlet only, a bank in the UAE. Yet, we will soon deal as well with other outlets, among them a British bank in London, with which the financial ban will come to an end,” he stated.

Salaries

On Tuesday, Minister of Trade and Industry Madani Abbas announced “important and unprecedented increases” of salaries in the country by April 20.

The Minister of Finance now said that the Council of Ministers the Cabinet has “in principle” approved the recommendations of the National Wages Task Force.

The minimum wages will rise to SDG 3,000 ($ 54*) per month. The basic salary and bonuses for employees in the 17th rank will amount to SDG 7,000.

“We have two options for the implementation,” Minister El Badawi explained.

“The first is to implement the new structure in the current year. Yet this option is costly, and will lead to an increase in expenses by about SDG 50 billion [$ 906.825]. The nation budget deficit will then cross the safe border. Adopting this option requires far-going support,” he said.

“The second option is more realistic, as it does not cost more than SDG 7 billion ($ 127 million) from the 2020 budget. In this option, the new structure will be applied in two phases. In the first phase this year, the minimum wage will be increased to SDG 1,500. It will reach SDG 3,000 in the next two years.”

Community dialogues

The minister added that the Council of Ministers left the two options for discussion in the Societal Dialogue, that exists of community dialogues on the ground.

In December last year, during a session on the 2020 National Budget, the Council of Ministers decided on a Societal Dialogue.

Minister of Culture and Information and Spokesman for the government, Feisal Mohamed Saleh, said in a press statement following the session that “We expect community dialogues, through all media, start from today. The citizens will be well informed about the economic crisis and about the available options to deal with it. So, the people will be our partners in treating the crisis.”

* As effective foreign exchange rates can vary in Sudan, Radio Dabanga bases all SDG currency conversions on the daily US Dollar rate quoted by the Central Bank of Sudan (CBoS). USD 1 = SDG 55.14 at the time of publishing this article.

 


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