Date: Monday, 24 September 2018
Sudan has a new, smaller government assigned with reviving the economy. But the odds are not in its favour, writes Haitham Nouri
Sudan’s new cabinet was sworn in Saturday amid an economic crunch that drove many officials to decline their new ministerial tasks to carry out “impossible or semi-impossible” missions.
President Omar Al-Bashir had initially nominated economic expert Abdallah Hamdok, acting executive secretary of the United Nations Economic Commission for Africa, as Sudan’s new finance minister, but Hamdok declined the post, according to SUNA, Sudan’s official news agency.
“After consultations with Prime Minister Moataz Moussa Abdallah, President Al-Bashir decided that the prime minister will hold the finance portfolio,” the presidency said in a statement Saturday.
Nagi Sherif turned down the offer to continue leading the State Ministry of Finance, with Muslim Al-Amir stepping in to fill the void.
Outgoing Minister of Education Samia Abu Keshwa declined heading the Ministry of Social Solidarity whose minister now is Wedad Yacoub.
The unprecedented number of turned-down offers indicate the difficult responsibility shouldered by the new government. Al-Bashir said the people of Sudan have “high hopes” in the new government. “One of the biggest challenges for the new government is to resolve the economic issues,” he stated after the swearing-in ceremony.
A presidential statement was released the night the previous cabinet was sacked stating that “the president had informed the Higher Coordinating Committee for following-up the implementation of the national dialogue outcomes that he intends to take big strides with the national unity government towards fixing the state of depression that has engulfed the country of by forming “an effective, sharp government that brings back hope to the Sudanese people”.
The new government comprises 20 ministers in addition to the prime minister holding the finance portfolio, and 27 state ministers in federal ministries. Foreign Minister Al-Dardiri Mohamed and Minister of Petroleum Azhari Abdel-Kader are retaining their positions.
On 10 September Al-Bashir dissolved First Vice-President Bakri Hassan Saleh’s national unity government comprising 31 ministers and tens of state ministers. Saleh remains first vice-president and Youssef Kebr second vice-president. Saleh was the first prime minister after Al-Bashir’s coup, supported by the Muslim Brotherhood and their late leader Hassan Al-Turabi, in June 1989, cancelled the position.
The presidency in Khartoum stated the new government headed by Abdallah, minister of irrigation and electricity in the outgoing national unity government, would see a smaller cabinet to decrease expenses.
Sudanese economic expert Khaled Mirghani believes that Al-Bashir had been appointing too many ministers since the 1990s in the federal rule regime. Sudan’s was an expansive central cabinet that included 26 municipal governments. “Imagine having 26 state rulers, each with their own government, parliament and governors. The number of officials was in the hundreds, exceeding Sudan’s capacity. Add to this the civil war and the wrong economic decisions and you are facing an exceptional financial haemorrhage,” Mirghani said.
Al-Bashir appointed Mohamed Kheir Al-Zobeir governor of the Central Bank three months after the death of Hazem Abdel-Kader, the former Central Bank governor. The latter assumed the post in December 2016 and was widely criticised because of his policies aiming to curb inflation.
The prime minister and Central Bank governor are ahead of a tough mission because of the shortage in foreign currency, getting worse since the independence of oil-rich South Sudan in July 2011.
Since South Sudan’s secession, Sudan has lost 75 per cent of its dollar revenues, depriving it of vital needs such as oil, wheat and medical supplies.
After the swearing in of the new cabinet, Minister of Petroleum Abdel-Kader said, “we can’t guarantee the oil crunch will not occur for two reasons. The first is that the refinery needs spare parts, which are imported in dollars. The second is that we import 40 per cent of the refinery’s requirements, which is obtained in foreign currency.”
Amid inflation that has reached 64 per cent, Sudan is suffering from a hike in food prices, which doubled in the past year.
The Central Bank depreciated the Sudan currency twice. The state set the dollar at 28 Sudanese pounds, whereas it is sold at the black market for 41 pounds.
Demonstrations erupted nationwide in protest at the rising prices and after the Sudanese people endured two shortage crises in bread and oil.
Fears mounted in April that the country was on the verge of bankruptcy after former foreign minister Ibrahim Ghandour stated that Sudanese diplomats “haven’t been paid in months. The Foreign Ministry has not been paying the rent of its headquarters abroad.”
Days later Ghandour was sacked without explanation by the presidency.
Donald Trump’s lifting of US sanctions, in force for two decades, didn’t help Khartoum’s economy either.
Former US president Bill Clinton labelled Sudan “a terrorism-sponsoring country”, imposing an embargo that his successor George W Bush tightened.
Sudan officials believe the lifting of US sanctions is not helping the country’s economy to recover because “international banks are worried about doing business with their Sudanese counterparts”.
Economic expert Mirghani sees things differently. “The reason is that Sudan is not ready to receive foreign investments because of depleting infrastructure, the collective immigration of the country’s skilled and talented labour, in addition to a set of old laws that don’t encourage new investments.”
Another reason, said Al-Haj Warraq, editor-in-chief of the online Horreyat newspaper, “is the monopoly of an elite close to the regime over the economy. This web has to be untangled before seeking new investments.”
Nevertheless, Sudan received Chinese investments that contributed to the construction of the Merowe Dam in the north, and a number of smaller projects.
Warraq believes Sudan’s economic situation controls the country’s policies. Sudan is fighting in Yemen thinking that Saudi Arabia and the United Arab Emirates will extend a helping financial hand. “Sudan’s make-up with South Sudan to resume oil pumping is caused by Sudan’s failing economy,” Warraq added.
Sudan’s new government, be it “sharp” or expanded, has a tough task ahead, and it is not sure to succeed.