Lifting U.S. sanctions on Sudan will opens the door to international investment and emergency financing from international lenders like the World Bank and IMF, regains access over $1bn per year. This will also open the door for Sudanese firms to rejoin international financial networks, which will prove crucial for remittances, trade, and investment flows.
Sudan’s economy is dropped with inflation exceeding 269 percent, and the Sudanese pound fall at 268 against the dollar (down from 82 thirteen months ago). The demand for hard currency, in the form of US dollars has surged, crippling the value of the Sudanese pound and eroding the purchasing power of most ordinary Sudanese. Perhaps, the removal of economic sanctions will made it easier to move money abroad, contributing to the increased demand for foreign currency and accelerating a cycle of capital flight. However, though there may be no definitive causal link between the ending of sanctions and worsening economic conditions.
On the other hand, the agreement that normalize ties with Israel, pave the way for economic and trade relations, with an initial focus on agriculture, agriculture technology, aviation and other areas for the benefit of the two countries.
Agricultural investment, seizing opportunities
Sudan is one of Africa’s most fertile and the world’s great breadbaskets, it’s enriched with many natural resources, among which cultivable land that is estimated at 74 million hectares, only 25 percent of which is currently under cultivation. The agriculture contribution to exports has drastically declined having been affected by oil production. Agriculture historically generated the bulk of Sudan’s foreign exchange earnings through a diversified basket of exports. Thus investing in agriculture is very smart at this point and have a many opportunities, with the Nile River running through it, Sudan has more than 150 million hectares of arable land. The climate is suitable for all types of crops, and water irrigation is readily available and natural. Sudan specializes in cereal production (sorghum, millet, wheat, corn and rice), crops (cotton, sugar, peanuts, sesame, and gum), and tropical fruit and vegetables. Integrating agricultural technologies with irrigation solution can increase the production, as a result crops prices will decrease in the local market, which will eventually make Sudan crops more competitive comparing to other counties, allowing hard currency to flow in. It’s important transactional period for Sudan to set up all the essential factors that facilitate international investment and insurance regulations.
References:
https://african.business/2020/10/trade-investment/new-economic-era-for-sudan-as-us-lifts-sanctions/
https://www.aa.com.tr/en/africa/sudan-announces-normalization-ties-with-israel/2017286
http://www.fao.org/fileadmin/user_upload/agwa/docs/NIP_Sudan_Final.pdf
