ECONOMY:
Economy—overview: Sudan is buffeted by civil war, chronic
political instability, adverse weather, high inflation, a drop in remittances
from abroad, and counterproductive economic policies. The private sector's
main areas of activity are agriculture and trading, with most private
industrial investment predating 1980. Agriculture employs 80% of the
work force. Industry mainly processes agricultural items. Sluggish economic
performance over the past decade, attributable largely to declining
annual rainfall, has kept per capita income at low levels. A large foreign
debt and huge arrearages continue to cause difficulties. In 1990 the
International Monetary Fund took the unusual step of declaring Sudan
noncooperative because of its nonpayment of arrearages to the Fund.
After Sudan backtracked on promised reforms in 1992-93, the IMF threatened
to expel Sudan from the Fund. To avoid expulsion, Khartoum agreed to
make payments on its arrears to the Fund, liberalize exchange rates,
and reduce subsidies, measures it has partially implemented. The government's
continued prosecution of the civil war and its growing international
isolation continued to inhibit growth in the nonagricultural sectors
of the economy during 1997. Hyperinflation has raised consumer prices
above the reach of most. In 1997, a top priority was to develop potentially
lucrative oilfields in south-central Sudan; the government was seeking
foreign partners to exploit the oil sector.
GDP: purchasing power parity—$26.6 billion (1997 est.)
GDP—real growth rate: 5% (1997 est.)
GDP—per capita: purchasing power parity—$875 (1997 est.)
GDP—composition by sector:
agriculture: 33%
industry: 17%
services: 50% (1992 est.)
Inflation rate—consumer price index: 27% (mid-1997 est.)
Labor force:
total: 11 million (1996 est.)
by occupation: agriculture 80%, industry and commerce 10%, government
6%
note: labor shortages for almost all categories of skilled employment
(1983 est.)
Unemployment rate: 30% (FY92/93 est.)
Budget:
revenues: $482 million
expenditures: $1.5 billion, including capital expenditures of $30 million
(1996)
Industries: cotton ginning, textiles, cement, edible oils, sugar, soap distilling, shoes, petroleum refining
Industrial production growth rate: 5% (1996 est.)
Electricity—capacity: 500,000 kW (1995)
Electricity—production: 1.305 billion kWh (1995)
Electricity—consumption per capita: 43 kWh (1995)
Agriculture—products: cotton, groundnuts, sorghum, millet, wheat, gum arabic, sesame; sheep
Exports:
total value: $620 million (f.o.b., 1996)
commodities: cotton 23%, sesame 22%, livestock/meat 13%, gum arabic
5% (1996)
partners: Saudi Arabia 20%, UK 14%, China 11%, Italy 8% (1996)
Imports:
total value: $1.5 billion (1996)
commodities: foodstuffs, petroleum products, manufactured goods, machinery
and equipment, medicines and chemicals, textiles (1996)
partners: Saudi Arabia 10%, South Korea 7%, Germany 6%, Egypt 6% (1996)
Debt—external: $20.3 billion (1996 est.)
Economic aid:
recipient: ODA, $387 million (1993)
Currency: 1 Sudanese pound (£Sd) = 100 piastres
Exchange rates: Sudanese
pounds (£Sd) per US$1—official rate: 1,602.70 (July 1997),
1,250.79 (1996), 580.87 (1995), 289.61 (1994), 159.31 (1993); market
rate: 1,612.90 (July 1997), 1,250.79 (1996), 571.02 (August 1995), 289.61
(1994), 159.31 (1993), 97.43 (1992)
note: the market rate is a unified exchange rate determined by a committee
of local bankers, without official intervention, and is quoted uniformly
by all commercial banks
Fiscal year: calendar
year
note: prior to July 1995, Sudan had a fiscal year that began
on 1 July and ended on 30 June; as a transition to their new fiscal
year, a six-month budget was implemented for 1 July-31 December 1995;
the new calendar year (1 January-31 December) fiscal year became effective
1 January 1996
Sudan's primary resources are agricultural. Although the country is
trying to diversify its cash crops, cotton accounts for nearly 50 percent
of export earnings. Another large export crop is gum arabic, used in
pharmaceuticals, food preparation, and printing, with Sudan producing
four-fifths of the world's supply. Grain sorghum (dura) is the principal
food crop, and wheat is grown for domestic consumption. Other crops
such as sesame seeds and peanuts are cultivated for domestic consumption
and increasingly for export. Livestock production has vast potential,
and many animals, particularly camels and sheep, are exported to Egypt,
Saudi Arabia, and other Arab countries.
The inadequate transportation system and the high cost of hauling agricultural
products over great distances are major hindrances to economic development.
Sudan's only paved highways link Khartoum to Port Sudan and the capital
to Kosti and the White Nile. Completed in mid-1980, the Khartoum-Port
Sudan road has greatly increased commerce between these cities. Southern
transportation is vulnerable to bad weather. Programs are underway to
improve roads in southern and western Sudan.
At present, the country's transportation facilities consist of one 4,800-kilometer (2,784-mi.), single-track railroad with a feeder line, supplemented by river steamers, Sudan Airways, and about 1,900 km. (1,200 mi.) of paved or gravel roads.
Sudan has made large investments in growing cotton under various irrigation and pump plans, particularly the Gezira scheme, south of Khartoum between the White and Blue Niles. Rain-fed agriculture, primarily millet, sesame seeds, peanuts, and short-staple cotton, has had uneven success; there is progress in developing the rain-fed areas for mechanized agriculture. These lands are promising, provided the problems of transportation and irrigation to supplement rainfall can be resolved.
Sudan's limited industrial development consists principally of agricultural processing and various light industries located at Khartoum North. Although Sudan is reputed to have great mineral resources, exploration has been quite limited, and the country's real potential is unknown. Small quantities of asbestos, chromium, and mica are exploited commercially. Extensive petroleum exploration began in the mid-1970s and might eventually produce all of Sudan's needs. Significant finds were made in the Upper Nile region, but the ongoing civil war in that area has forced suspension of exploration and development activity there.
Sudan has an installed electrical generating capacity of 300 megawatts (MW), of which 180 MW is hydroelectric and the rest, thermal. More than 70 percent of the hydropower comes from the Roseires Dam on the Blue Nile grid. Various projects are underway for expanding Roseires power station and for developing thermal and other sources of energy.
The United States, the Netherlands, Italy, Germany, Saudi Arabia, Kuwait, and other Organization of Arab Petroleum Exporting Countries (OAPEC) nations traditionally have supplied most of Sudan's economic assistance. Sudan's role as an economic link between Arab and African countries is demonstrated by the location in Khartoum of the Arab Bank for African Economic Development. The World Bank has been the largest source of development loans.
Sudan will require extraordinary levels of program assistance and debt relief to manage a foreign debt exceeding dollars 13 billion, more than the country's entire annual GDP. Since the late 1970s, the IMF, World Bank, and key donors have worked closely to promote reforms to counter the effect of inefficient economic policies and practices. By mid-1984 a combination of factors-including drought, inflation, and confused application of Islamic law-reduced donor disbursements, and capital flight led to a serious foreign-exchange crisis and increasing shortages of imported inputs and commodities.
The government fell out of compliance with the IMF standby program and accumulated substantial arrearages on repurchase obligations to the IMF. A 4-year economic reform plan was announced by the Sadiq government in 1988 but was not pursued. The government of General Omar al Bashir announced its own economic reform plan in 1989 and began implementing a 3-year economic restructuring program on July 1, 1990, designed to reduce the public sector deficit, end subsidies, privatize state enterprises, and encourage new foreign and domestic investment. Sudan remains the world's largest debtor to the IMF, with accumulated arrears of over $1.3 billion. In August of 1993, the IMF suspended Sudan's voting rights. In September of 1993, the World Bank suspended Sudan's right to make withdrawals under effective and fully disbursed loans and credits.
Sudan continues to suffer from a severe shortage of foreign exchange, as imports exceed exports by more than two to one. In October of 1993, the government reimposed currency controls, making it illegal to possess foreign exchange without prior approval. Exports are largely stagnant. The small industrial sector remains in the doldrums, and Sudan's inadequate and declining infrastructure inhibits economic recovery. Foreign exchange rate policies discourage remittances from Sudanese working abroad.
DEFENSE
The Sudanese People's Armed Forces is a 60,000-member army supported
by a small air force and navy. It is a defensive force, having the additional
duty of maintaining internal security. Some rebels currently fighting
in the South are former army members. Sudan's military services are
hampered by limited and outdated equipment. In the 1980's, the US worked
with the Sudanese government to upgrade equipment with special emphasis
on airlift capacity and logistics. All US military assistance was terminated
following the military coup of June 30, 1989. Sudan has most recently
received military assistance from Iraq, China, and Libya.