War-torn Sudan sees pound plunge, Dollar soars past 2,100
July 14, 2024 (PORT SUDAN) – The Sudanese pound continued its downward spiral against foreign currencies, exacerbating the financial strain on millions of Sudanese who have lost most of their income due to the ongoing conflict.
Dealers in the parallel market informed Sudan Tribune on Sunday that one dollar was exchanged for 2,100 pounds, while the Saudi riyal fetched 560 pounds and the UAE dirham traded at 572 pounds.
The continuous decline in the national currency’s value has been attributed to the increased demand for foreign currencies, particularly the dollar and the riyal, amidst a scarcity of supply.
A black market dealer revealed that the pound’s instability led him to cease operations to avoid losses, as most Sudanese are seeking foreign currencies due to the lack of local demand.
The Bank of Khartoum offered to buy dollars at 1,860 pounds and sell them at 1,873 pounds while offering the Saudi riyal for purchase at 501.49 pounds and selling it at 505.25 pounds.
The parallel market has shifted from the capital, Khartoum, to Port Sudan, where the army has established a base for managing the nation’s affairs.
The weakening pound is expected to further erode the purchasing power of the Sudanese, most of whom now rely on remittances from abroad due to the disruption of livelihoods, including agriculture, across vast swathes of the country.
Economic expert Mohamed Al-Nayer told Sudan Tribune that while a decline in the national currency is expected during the war, the government’s inaction in addressing the issue is concerning.
Al-Nayer urged authorities to implement measures to halt the currency’s deterioration, such as withdrawing large pound denominations from circulation, restricting luxury imports, boosting exports, rationalizing public spending, and increasing revenue.
On February 26, Finance Minister Gibril Ibrahim reported that state revenues had plummeted by over 80%.
Mohamed Al-Nayer highlighted that 95% of the money supply being held by the public contributes to the imbalance that fuels the parallel currency market, necessitating urgent intervention.
Before the outbreak of the conflict between the army and the Rapid Support Forces on April 15, 2023, the exchange rate stood at 570 pounds to the dollar.