By Eric Reeves
I’ll be writing regularly about what follows in the wake of the Trump administration’s permanent lifting of U.S. economic sanctions on the Khartoum regime. Given the abundance of commentary on the benefits of such action, it seems useful to begin with the observations of a Sudanese economist who actually knows something about the Sudanese economy, as opposed to the staggering ignorance in this sphere revealed in commentary by the International Crisis Group, other American and European “think tanks,” and actors such as UNAMID, whose contemptible performance in reporting on what has occurred in Darfur since the Mission deployed in January 2008 makes its celebration of the Trump administration action particularly and perversely ironic. Professor Hamid Eltigani of American University in Cairo has regularly and astutely commented on the economic situation in Sudan and understands full well the dynamics of the collapsing economy. His previous work—frequently cited by actual experts on Sudan such as Suliman Baldo and Omer Ismail—has proved consistently accurate and Radio Dabanga’s interview of him today provides a useful overview:
“US sanctions relief will not improve living conditions in Sudan”: Economist
Radio Dabanga | October 9, 2017 | CAIRO / KHARTOUM
Economic expert Prof Hamid Eltigani has contradicted predictions by Sudanese government officials that the US lifting of the trade embargo on Sudan will solve the economic crisis in the country to a large extent. Sudan’s FA Minister announced that the second phase of the dialogue with Washington will take place early next year. According to Prof Eltigani, economist and head of the Department of Public Policy and Administration at the American University in Cairo, the permanent lifting of the trade embargo on Sudan as declared by Washington on Friday, “has mostly a psychological effect. The lifting of the sanctions opens the door for Sudan to free trade and investment, but the problem is that Khartoum is bankrupt and has nothing to sell,” he commented in an interview with Radio Dabanga broadcast today.
“Almost all industries have become inoperable in Sudan, as their structures have collapsed,” he explained. “Most of the productive forces migrated to urban areas and are trying to survive by doing marginal jobs in the informal sector. Others are living in the various camps for the displaced. In addition, the country’s infrastructure and the education sector that is supposed to provide qualified production cadres have collapsed completely.”
Eltigani does not believe that investors will enter into long-term projects. “Major US and European companies will refrain from investing in Sudan under these circumstances, especially as Sudan is still on the list of countries that support terrorism. These countries will most probably not invest in Sudan as long as Al Bashir remains in power,” he stated. “Service companies such as McDonald’s, Pizza Hut etcetera may enter the Sudanese market but they will not contribute to an increased production.”
The economist predicted that large national transport institutions such as Sudanair, the railways and sea lines, and the El Gezira Agricultural Scheme “will not return to normal again. “The collapse of these institutions does not result from the sanctions and the ensuing scarcity of spare parts, as government officials claim, but of forgoing corruption, mismanagement, and a lack of commitment to the services they provide.” He ruled out that the lifting of the sanctions on Friday will stabilise the rate of the Sudanese Pound, but predicted a further rise of the price of the Dollar against the Sudanese Pound at the black market. “The dependence on the import of various basic commodities such as grain or medicine requires hard currency.
“The government is supposed to raise the exchange rate, but instead it is misleading the people with slogans saying the lifting of the sanctions will solve the economic crisis – which of course will not happen.” He further refuted rumours that the lifting of the sanctions represents an opportunity for government officials to smuggle the hard currency they acquired through corruption abroad. “These allegations are unfounded because the leading members of the current regime and its beneficiaries have secured their money long ago. At least 11 billion Dollars have been put away in Malaysia, the United Arab Emirates and other countries in the Arab Gulf,” he said.
Not all sanctions lifted
On Friday, the administration of President Donald Trump lifted two-decades-old economic sanctions on Khartoum “in recognition of the Government of Sudan’s sustained 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 US State Department noted that any further normalisation in the bilateral relations with Khartoum requires “continued progress” by the Sudanese government.
The US decision did not include the removal of Sudan from the list of states sponsoring terrorism—to which it was added in 1993—which means that restrictions on debt relief, receiving foreign aid, or the sale of arms are still in place.
In a press conference in Khartoum on Saturday, Sudan’s Minister of Foreign Affairs, Dr Ibrahim Ghandour, announced visits by American high-level officials within the coming weeks “to further develop the partnership between the two countries” He said that Khartoum agreed with Washington to start “the following dialogue stage early next year. “There are files still pending, including keeping Sudan on the list of state sponsors of terrorism, the external debts problem, and Sudan’s accession to the World Trade Organisation.”
Eric Reeves, Senior Fellow at Harvard University’s François-Xavier Bagnoud Center for Health and Human Rights
Source – Sudan Tribune (ST)