Sudan optimistic about growth after US says it would lift sanctions

For the Sudanese, living with economic sanctions on their back had taken a toll on them, even though they never used to say it.

But when US President Donald Trump announced in October that he had lifted an embargo on Sudan, ending nearly two decades of isolation from the lucrative international markets, Khartoum’s officials were all smiles.

SANCTIONS

The ban had removed about $500 billion (Sh50 trillion) from their economy “with indirect loss estimated at about $4 billion (Sh400 billion) per year,” said Nimat Jad Allah, a Sudanese diplomat and information official at the embassy in Nairobi.

“For nearly 20 years, the US economic sanctions, which banned all kinds of commercial and financial dealings with Sudan, cast severe damage on the Sudanese economy,” she told the Nation.

“The Sudanese banking sector was cut off from the global financial system as more than $7 million (Sh700 million) belonging to the banking sector in Sudan was frozen.”

The financial restrictions put limits on all sectors that supported Sudan’s $96 billion (Sh9.6 trillion) economy. Firms could not buy new technology or spare parts from the West, Sudan had to make do with tougher trade rules which meant many of the industries could shut down either for lack of sources of new machinery or because their finances were frozen. The main Sudanese airline, Sudan Airways, has struggled to service its aircraft after major manufacturers like Boeing and Airbus were barred from engaging with it.

REPRIEVE

In October, President Trump said his government was lifting sanctions because Sudan had shown “positive actions” to maintain a cessation of hostilities in conflict areas in Sudan, improve humanitarian access throughout Sudan, and maintain cooperation with the US on addressing regional conflicts and the threat of terrorism.

“The Government of Sudan’s actions during the last nine months show that it is serious about cooperating with the US and has taken significant steps to stop conflict and improve humanitarian access within Sudan, and to promote regional stability,” said Mr Trump.

He, however, retained Sudan on its list of State sponsors of terrorism until another round of review of the situation, which means that it is still barred from buying arms from the West.

He also warned that Khartoum will have to do more to be entirely admitted into the global system.

TRADE

For the Sudanese, however, the lifting of sanctions on financial restrictions has brought relief.

“The decision to lift the sanctions on Sudan represented an important shift in Sudan’s economic relations; it constituted a turning point in Sudan’s foreign relations, marking its return to the world trade and financial system,” said Elsadig Abdalla Elias, the Sudanese ambassador to Kenya.

Sudan has a population of about 40 million people, half of who live below the poverty line. And except its certain regions where there have been wars like in Darfur, it should be one of the richest countries in Africa.

According to the World Bank, Sudan often attracted $5 billion (Sh500 billion) in foreign investment and its exports were worth $3.7 billion (Sh370 billion) a year. The imports were mainly precious metals, oil and sugar.

Its main markets have been the Middle East. The Arab Spring and sanctions were the bad luck the Sudanese didn’t need.

PROBLEMS

In addition, when South Sudan seceded in 2011, it lost half its revenues from exports.

The IMF says Sudan’s annual growth rate has been 3.5 per cent annually.

Sudan’s problems had begun earlier in 1997 when the US imposed a trade embargo and froze certain assets belonging to firms owned by the Sudanese, including a trade embargo and asset freezes, for “terrorism” concerns and rights violations.

At the time, Sudan was accused of sponsoring terrorism and hosting some of the terrorists (Osama Bin Laden once stayed in Sudan before he became a feared terror merchant).