Sudanese officials calls for reducing dependency on oil revenues
November 6, 2008 (KHARTOUM) – A Sudanese official today called for boosting local productivity and reducing dependency on oil exports in light of the financial crisis that hit all across the globe.
The Sudanese state minister for finance Lual Deng told official news agency (SUNA) that the 2009 budget was calculated to incorporate the drop in crude prices.
Deng further said that the upcoming federal budget is placing more emphasis on non-petroleum exports while trying to cushion any possible negative impact on less privileged sections of the society.
“Specialized committees are evaluating the repercussions of the crisis on the Sudanese economy” the Sudanese official said and added that coordination of fiscal monetary and productivity policies will help sustain the positive growth rate.
The state minister also noted that there is an opportunity for Sudan to aggressively seek to attract Arab investments in agricultural sectors.
Khartoum has sought to downplay the effects of the global financial crisis saying that US economic sanctions provided immunity to its economy.
However as the credit crisis unfolded it led investors to believe that oil demand will be severely curtailed in developed nations and possibly China and India. Crude oil is down more than 56 percent from its all-time peak of $147.27 reached July 11.
Adding to Sudan’s woes is a weakening Euro against the dollar. Last year Sudan central bank converted all its dollar reserves into Euro in order to circumvent both current and future sanctions imposed by the US.
Deng said that the 2008 budget is not impacted by the decrease in oil prices but acknowledged that expenditures will be more scrutinized for the remainder of the year.
He also blamed the crisis on the “capitalistic system that is based on the interest”. Islamic Shari’a law which governs Northern Sudan prohibits using interest in extending credit.
Oil exports represent 65% of revenue for Sudan and helped fuel its unprecedented economic growth despite US economic sanctions.
(ST)