Sudan finance minister says country dependent on oil revenue
November 26, 2008 (KHARTOUM) —The Sudanese finance and national economy minister Awad Al-Jaz acknowledged that world financial crisis would impact the economy more than previously announced.
Al-Jaz speaking to Sudan official agency (SUNA) said that drop in oil prices is the determining factor on the magnitude of the effect on the country.
“Sudanese economy is hugely dependent on oil revenue. The price collapse from $147 to $40 a barrel provides a realistic insight into the impact” Al-Jazz said.
Oil exports represent 65% of revenue for Sudan and helped fuel its unprecedented economic growth despite US economic sanctions.
Khartoum has sought to downplay the effects of the global financial crisis saying that US economic sanctions provided immunity to its economy.
“Sudan escaped the direct hit of the crisis but we are not isolated from the rest of the world” the Sudanese official said.
Al-Jaz called for taking advantage of the world food crisis this year and focusing on marketing Sudan as an investment spot for agriculture.
“This will only happen through hard work so Sudanese exports can compete in world market” he added.
The 2009 budget incorporated increases in duties levied on imported vehicles and indirect taxes on telecom services. The move was intended to offset the drop in oil income.
This month – Sudan has been forced to cancel its tender to sell 500,000 barrels Nile Blend crude for January delivery because of low bids.
Sudan’s offer came after already skipping October & December spot sales for unknown reasons. The Greater Nile project which produces this heavy sweet, high-quality, Nile Blend crude has experienced diminishing productivity lately from 325,000 barrels per day (bpd) to 200,000.
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.
(ST)