Readings in the Economic Impacts of Recent Changes in Macroeconomic Policies in Sudan (1)

Abstract:     
The secession of Southern Sudan from the mother nation of Sudan was a direct result of political agreement known as the Comprehensive Peace Agreement (CPA). It was expected by the totalitarian government of Northern Sudan that it can contain the civil war between the Sudan Popular Liberation Army (SPLA) and the Islamized Ingaz totalitarian regime of Khartoum. However, the impacts of an important economic factor was not properly calculated which is that more than 75% of oil produced in unified Sudan is produced from fields that originate in its south. After secession, the Northern country was deprived of that resource while its other real economic sectors, agriculture and industry were in stagnant conditions due to long period of negligence by the state authorities and scavenging by its taxation. The case was typical of applied Dutch Disease of dependency on one natural resource. The country's economic conditions quickly deteriorated from worse to worst. That instigated the government to seek solutions which were by increasing taxation, floating or drastically its domestic currency prices. The results were catastrophic manifested in increasing the inflation from minimal to galloping and rife. Recession that have hovered around its economy since 2008 with the Global Financial Crises effects combined with inflation to manifest in a classical case of strong stagflation. I am not proud to be right of predicting those signs for the past six years. However, I just record it for history with another vision that solutions to Sudan economic crisis will not be solved without reaching political solutions for its current dominating regime. The behaviors of the concerned departments' manifest that they never listen to scientific recommendations neither to wise advices. Unless there are true and physical changes in the whole regime, comprehensive restructuring and monetary infusions from outside the country, all of the imagined Four Horsemen of the Apocalypse are expected.

Note: Downloadable document is in Arabic.

Number of Pages in PDF File: 5

Keywords: Sudan, Macroeconomic Policies, Stagflation, Economic Collapse and Possible Relief

JEL Classification: E3, E30, E31, E32, N17, N27, N37, N47, N57, O1, O10, O11, O12

working papers series