IMF expresses concerns about Sudanese economy

The International Monetary Fund (IMF) has projected a grim economic outlook for Sudan in 2023, anticipating a substantial contraction of over 18% in the country’s GDP. This dismal forecast is primarily attributed to the ongoing war that has been ravaging Sudan since April of the same year.

In its semi-annual World Economic Outlook released on a recent Tuesday, the IMF highlighted that the protracted conflict is inflicting severe damage on Sudan’s infrastructure and undermining access to essential services. The war, initiated on April 15, is a power struggle between General Abdel Fattah al-Burhane and the Rapid Support Forces led by General Mohamed Hamdane Dagalo. This devastating conflict has tragically resulted in the loss of more than 9,000 lives and the displacement of over 5 million people in one of the world’s most impoverished nations.

Sudan was already grappling with soaring inflation, which had reached triple figures before the conflict erupted. Regrettably, the economic outlook has further deteriorated since April. The situation is exacerbated by the abrupt cessation of gold sales, a vital source of foreign currency income for the nation. Sudan, as Africa’s third-largest gold producer, has witnessed a virtual halt in gold sales.

The agricultural sector, which constitutes 40% of Sudan’s GDP and is responsible for 80% of the country’s employment, has been severely impacted. Trade and financing in this sector have been profoundly disrupted. Furthermore, the Sudanese pound has depreciated significantly, losing half of its value since the commencement of the war.

The IMF has raised a concerning alarm that the repercussions of this ongoing conflict could persist for an extended period, and the process of reconstruction is likely to span many years. Moreover, the institute has cautioned that not only Sudan but also neighbouring countries and the broader North African region will endure the negative consequences of a weakened Sudanese economy.