Economic Collapse is Accelerating in Sudan–and so is the potential for explosive civil unrest, and equally massive, violent repression by Khartoum regime
Eric Reeves | December 27, 2017 | https://wp.me/p45rOG-2b1
The collapse of the Sudanese economy continues to accelerate—yet there is no international reporting on developments that could spark massive civil unrest and equally massive, violent repression by regime. IMF silence is particularly disgraceful. All the warning signs are here, and the explosion could dwarf that of September 2013 when the regiome precipitously lifted subsidies on fuel.
• Economist: “Sudan’s real inflation rate tops 50%” | Radio Dabanga | December 27, 2017 | CAIRO / KHARTOUM | https://www.dabangasudan.org/en/all-news/article/economist-sudan-s-real-inflation-rate-tops-50
The Sudanese government’s official increase in the US Dollar price from SDG 6.6 to SDG 18 is as a step towards floating the Sudanese Pound and liberalising the US Dollar price, according to a leading expert on Sudan’s Economy. “The real inflation rate in Sudan now exceeds 50 per cent,” says Prof Hamid Eltigani, head of the Department of Public Policy and Administration at the American University in Cairo. In an interview with Radio Dabanga, Prof Eltigani attributed the Sudanese government’s official Dollar price to controlling the four billion US Dollars in reserves in the banks.
“The budget of 2018 as a real disaster,” he said, pointing out that “68 per cent of the revenues depend on taxes and 32 per cent on borrowing; whether from the banking sector or from countries. Oil and gold will exit the budget altogether.”
Prof Eltigani doubts the government’s ability to collect taxes covering 68 per cent of the budget and pointed to the steady decrease in the tax base due to the recession, the weakness of purchasing power, the high inflation rates, and the continuous increase in commodity prices. He highlights the absence of development from the budget of 2018 as “the Sudanese government has officially abandoned spending on services, especially education and health, with emphasis on the first item of wages, government spending, and increased spending on security and the army.”
Prof Eltigani ridiculed statements by Finance Minister Dr Mohamed Osman El Rikabi that the aim of the budget is to reduce inflation rates from 34.1 percent to 19.5 percent. He said it is impossible to lower the inflation rates while the government is continues to borrow from the banking sector by printing more currency. He questions the official government figures for inflation rates and pointed out that the real inflation rates in Sudan exceed 50 per cent. “The new budget will lead to a continuous increase in the prices of commodities including flour and fuel. The only way out of the current situation is structural changes in the governance and the way the economy is managed.
Ibrahim El Sheikh, the former President of Sudanese Congress Party, described the economic situation as “very grim” and considered that “all the vital indicators indicate that Sudan is about to collapse.”
• Most fuel stations closed in Port Sudan, bakeries shut | Radio Dabanga | December 27, 2017 | SUDAN | https://www.dabangasudan.org/en/all-news/article/most-fuel-stations-closed-in-port-sudan-bakeries-shut
The ongoing severe fuel and cooking gas shortage in Port Sudan resulted in most fuel stations in Port Sudan shutting down on Tuesday. Gas-fired bakeries have also stopped operating. Journalist Osman Hashim told Radio Dabanga that long queues of vehicles wait at the fuel stations all day long. Gas-fired bakeries have also stopped working because of the cooking gas crisis. According to Hashim, the station agents attributed the crisis to the delay in the discharge of the fuel tankers in Port Sudan.
The residents of three villages in Jebel Moon in West Darfur have complained of a severe drinking water crisis. One of the residents told Radio Dabanga that the villages of Manjoura, Jamal Arseif and Fareeda have no water engines or hand pumps. He said they rely on underground wells whose water has dried up prompting them to travel long distances to fetch water from the surrounding areas. He appealed to the authorities to establish water engines and provide hand pumps…
The Red Sea state in eastern Sudan is witnessing a surge in prices and an unprecedented rise in the prices of basic commodities. A number of farmers from the Northern state have complained of the sudden and large increase in electricity tariffs for agricultural projects amounting to 1,000 per cent. They have expected failure of the winter season of growing wheat, Egyptian beans and a number of cash crops. Some factory owners have threatened to stop working if electricity tariffs are increased
The secretary-general of the union of chambers of industry, Abbas Ali El Sayed, told a news conference that the price of a ton of iron will rise from SDG 15,000 to SDG 20,000 and an iron bar from SDG 100 to SDG 300. Last week, petrol stations in Khartoum witnessed long queues for the third day in a row. On Tuesday and Wednesday, hundreds of people waited in vain for transport at bus stations in Omdurman, Khartoum North, and Khartoum.
A government source has attributed the scarcity of fuel to delays in shipments through Port Sudan. NISS officers have warned the Sudanese media by telephone not to report about the scarcity of bread and fuel in the country.
The regime’s response to the economic crisis is to continue with its policy of “shooting the messenger,” rather than addressing the problems. Repression has always been the tool of first resort for the regime:
• Sudan: new measures against Forex speculation | Radio Dabanga | December 27 – 2017 KHARTOUM / OMDURMAN | https://www.dabangasudan.org/en/all-news/article/sudan-new-measures-against-forex-speculation
On Tuesday the Sudanese Finance Ministry revealed new security and administrative measures to prevent speculation in foreign currency. In a press statement at the Houses of Parliament in Omdurman on Tuesday, the State Minister at the Ministry of Finance Abdelrahman Dirar said that “there will be new security and administrative measures to prevent speculation in foreign currency.” Dirar also declared that “the government will stop buying the US Dollar from the parallel market.”
Parallel [black market] price
In a press statement of Tuesday, the Director of the Central Bank of Sudan (CBoS), Hazim Abdelgadir, announced an agreement between the bank and the Ministry of Finance that the Ministry will buy foreign currency, especially the US Dollar from the bank at the parallel market price instead of the official price. He stressed willingness to provide the amounts needed by the Finance Ministry. “The Ministry is used to buying the US Dollar from the Central Bank at the official price which was creating problems.”
Forex dealers fear arrest
Foreign currency dealers said there is great fear when dealing directly with their customers after the penalties and security measures adopted by the authorities in November, in an attempt to stem the unofficial foreign exchange market. The measures have seen currency dealers being arrested, while others fled abroad.
In early December, the Central Bank of Sudan (CBoS) ordered banks to freeze the assets of dozens of Sudanese people and companies. The State Security Prosecution charged them for trading currencies, against the instructions of the CBoS. In an attempt to boost foreign currency reserves, the CBoS has also instructed all banks in Sudan to hand over remittances by Sudanese expatriates abroad in the same currency as the transfer.
No international actor has been more irresponsible than the IMF in warning about Sudan’s economic collapse: “Mr. Edward Gemayel, the IMF’s Mission Chief for Sudan noted that ‘Sudan has a long track record of implementing sustainable economic policies.'”
From Radio Dabanga (December 2017)
• Prices soar, bakeries shut in Sudan bread, fuel crisis | December 29, 2017 | SUDAN
The knock-on effect of the steady rise in the price of the US Dollar on Sudan’s currency market continues to impact on prices of consumer goods on markets in Khartoum and the other states. Bread, fuel, and cooking gas prices have soared due to short supply.
• Analyst: Sudan’s draft 2018 budget “tragic and catastrophic,” December 28, 2017 | KHARTOUM
Sudan’s draft general budget for 2018 represents “as a siege on citizens’ livelihood as a result of rising prices, high inflation rate, increasing cash mass, and demand for goods and commodities for the privileged segment,” says respected Sudanese economist Prof Sidgi Kaballo.
• Economist: “Sudan’s real inflation rate tops 50%,” December 27, 2017 | CAIRO / KHARTOUM
The Sudanese government’s official increase in the US Dollar price from SDG 6.6 to SDG 18 is as a step towards floating the Sudanese Pound and liberalising the US Dollar price, according to a leading expert on Sudan’s Economy.
• Most fuel stations closed in Port Sudan, bakeries shut,| December 27, 2017 | SUDAN
The ongoing severe fuel and cooking gas shortage in Port Sudan resulted in most fuel stations in Port Sudan shutting down on Tuesday. Gas-fired bakeries have also stopped operating.
• Large spending on army: Economists criticise 2018 budget, December 26, 2017 | KHARTOUM
The draft annual budget for 2018 for Sudan allocates a high percentage of revenue to the army, security service and paramilitary forces similarly to in 2017. Just three per cent of the budget is allocated to education.
• Long queues at Sudan’s bakeries, fuel stations, December 22, 2017 | SUDAN
The severe bread and fuel crisis is still being reported from various states in Sudan.
• Widespread bread shortages, Sudan fuel crisis halts transport, December 21, 2017 | SUDAN
Khartoum and a number of Sudanese states are experiencing a severe bread and fuel crisis. Transport has ground to a halt leaving many stranded.
• Short rations deepen food shortage in Darfur camps, December 20, 2017 | DARFUR
The Darfur Displaced and Refugees Association complains that little food aid has reached the displaced camps in Darfur for more than four months. The Association has warned of the consequences of this and its impact on the displaced people in the light of the failure of the agricultural season this year.
• MPs warn parliament for looming food gap in Sudan, December 19, 2017 | KHARTOUM
Sudanese members of parliament have warned for a looming food gap in Sudan as a result of the low production of sorghum in the current agricultural season.
• Sudan Parliamentary Health Committee predicts ‘impending disaster’ as medicine prices soar, December 18, 2017 | KHARTOUM
The health committee of the Sudanese Parliament expects an ‘impending disaster in the pharmaceutical sector’ and announced that foreign companies have stopped supplying medical supplies and lifesaving and chronic disease medicines because of the accumulation of debts. The committee chair, Imtithal El Rayah El Tireif, acknowledged that medicine prices have increased threefold, putting them beyond people’s affordability.
• Flour shortage sees long queues at bakeries in Sudan, December 17, 2017 | SAWAKIN / ATBARA / EL OBEYED
The residents of Sawakin in Sudan’s Red Sea State have complained of a severe bread crisis that has lasted for more than a month. People must queue at bakeries for many hours in the hope of buying some bread. Some bakeries have shut-down altogether.
• Sudan’s currency traders fearful as US Dollar tops SDG 26.20, December 17, 2017 | KHARTOUM
The value of the Sudanese Pound (SDG) continues to fall against the US Dollar, with the greenback now trading at SDG 26.20 on the Khartoum parallel market. Foreign currency dealers said there is great fear when dealing directly with their customers after the penalties and security measures adopted by the authorities in November, in an attempt to stem the unofficial foreign exchange market.
• “Trade monopoly” pushes-up grain prices in eastern Sudan, December 17, 2017 | EL GEDAREF
The prices for sorghum and sesame have risen sharply in Sudan’s El Gedaref – a hike attributed to a limited number of traders controlling the market.
• Refinery shutdown: Fuel crisis looms in Sudan, December 13, 2017 | OMDURMAN
Economists have predicted the Sudan will face a serious fuel crisis in the coming months following the scheduled shutdown of the Khartoum refinery in early March for maintenance and the final decommissioning of the Port Sudan refinery. Chairman of the Economic Affairs Committee of the Sudan Parliament, Ali Mahmoud, has attributed the economic problems experienced by the country to “the government buying US Dollars from the black market for the purpose of buying oil. This led to the decrease of the Sudanese Pound and the rise in prices of consumer goods.”
• Thousands of wheat fields dry up in Sudan agricultural scheme, December 12, 2017 | EL GEZIRA
A lack of irrigation water has caused at least 60,000 acres of wheat fields in El Gezira Agricultural Scheme to dry up. Member of Parliament Adlan Mahmoud reported the lack of irrigation water in El Gezira scheme, located between the Blue and White Niles south of Khartoum, which used to be one of the world’s largest irrigation project.
• Medicine shortage a risk for patients in Sudan hospitals, December 11, 2017 | KHARTOUM
The prevalence of expired medicines in hospitals in Khartoum has reportedly led to direct health risks for patients. The current medicine crisis is exacerbating, with hospitals being unable to purchase medicines. Medical sources in Khartoum reported that the available dialysis solutions will be depleted within a week from now, which they think will pose a direct risk to kidney patients. They told Radio Dabanga that large quantities of expired injections have been withdrawn from the hospitals recently.
• North Darfur drivers call for action against high transit fees, December 11, 2017 | UM KEDDADA
Passenger and commercial vehicles have complained about the levies imposed on them on the road between El Kuma and Um Keddada in North Darfur. El Ingaz road connects the two localities. Passing the toll gates, bus and vehicle drivers have to pay transit fees to security or militia forces.
• Pharmacists warn of medicine scarcity in Sudan, December 8, 2017 | KHARTOUM
While medicine prices increase, some life-saving medicines have become scarce in Khartoum and other states. Patients and their attendants complained that medicines have become unaffordable.
Some medicines prices have exceeded the price issued that the board of medicines issues in 2016, pharmacist Awad Mohamed said. “The price of Atakat tablets for blood pressure has risen from SDG 280 ($41.70) to SDG 418 ($62.30). The price for one of the categories of diabetes drugs has risen from SDG 550 ($82) to SDG 1037 ($154.60).”
• Sudan food prices soar, December 3, 2017 | KHARTOUM / EL FASHER / SAWAKIN
The prices of foodstuffs and consumer goods, especially meat and sugar, have soared in various Sudanese states, as demand exceeds supply. Last week the price of a kilogramme of beef in Khartoum rose from SDG 70 ($10,50) to SDG 100 ($15) and lamb from SDG 130 ($20) to SDG 150 ($22,50).