Sudan awaits possible announcement on subsidies at cabinet meeting on Thursday
September 18, 2013 (KHARTOUM) – The Sudanese people are closely watching the cabinet meeting on Thursday for the possibility that it will formally approve the government’s plans to remove fuel subsidies.
The decision, if approved by the cabinet today, would go into effect immediately particularly after the parliament gave the government the green light to go ahead with the implementation of the economic reform package that includes lifting subsidies.
A parliamentary committee headed by speaker Ahmed Ibrahim Al-Tahir approved on Tuesday the government’s move to lift subsidies.
But according to press reports published in Khartoum newspapers on Wednesday the cabinet may approve the decision but on condition that it be implemented at later stage.
However, the council of ministers’ secretariat denied that a cabinet session will be held today, saying that it hasn’t been notified that a meeting will convene on Thursday.
The pro-government Al-Rayaam newspaper reported that the new economic measures will be announced by the Sudanese president Omer Hassan Al-Bashir at a press conference on Sunday.
It said that money which is being kept outside the finance ministry’s official accounts is twice the budget deficit, demanding a political move to force the ministries which hold that money to return it to the public treasury.
Gas stations in downtown Khartoum appeared to be wary of the harbingers of implementing the decision to lift fuel subsidies particularly after the gas distributing companies refused to deliver the regular quotas.
Traders say that the distributing companies are awaiting the cabinet’s decision to go into effect.
A worker at a gas station in Khartoum 2 neighborhood said that they want to avoid the overcrowding which will follow the announcement of the decision, adding that people are concerned about gas scarcity prior to the implementation of the decision.
The editor-in-chief of Elaph business weekly newspaper and economist, Khalid Al-Tigani Al-Nour, advised the government not to implement the decision and said that the crisis is in essence a political one, stressing that priority must be given to restructuring power.
He pointed that there are more than 2 million poor families in Sudan and only 100,000 of them benefit from the government subsidies which means that 1.9 million families have not received subsidies.
“Those figures refute the government claim that the move is intended to direct the subsidies to the poor families”, he added
The former state minister at the Ministry of Finance, Abda Al-Mahdi, demanded the government not to lift fuel subsidies and called for utilizing the billions of pounds being held into the defense, oil, and electricity ministries, saying that this money is enough to cover the budget deficit.
She also called for intensifying fight against corruption, which according to her “deeply penetrated the power structure”.
The Democratic Unionist Party’s (DUP) former presidential candidate, Hatim Al-Sir, said that the decision would negatively affect the poor people who constitute 90% of the population, predicting that the government will face fierce resistance to back down from this move.
“A comprehensive political reform policies need to be adopted in order to overcome the economic crisis. The government policies have nothing to do with economic reform”, he added.
The Sudanese Communist Party (SCP) advised the government to refrain from implementing the decision and to use instead the money kept in several key ministries to cover the budget deficit.
The SCP spokesperson, Youssef Hussein, pointed that the government doesn’t actually subsidize goods and it only intends to increase prices in order to fund its wars and military spending, saying that corruption and the government extravagant spending are the main reasons for the economic meltdown.
Hussein said that the SCP is mobilizing its base to protest against the new measures, asserting that resistance will escalate until the regime is toppled.
The SCP member of the economic committee, Kamal Karar, said that when the 2013 budget was approved it didn’t take the necessary precautions to compensate for the loss of South Sudan’s oil transit fees, pointing that the government and the minister of finance should have resigned when the budget collapsed.
He pointed to the large spending on security, defense, presidency, and the federal governance, saying that the money being held outside the finance ministry’s accounts must be used to cover the budget deficit instead of increasing commodities prices.
Karrar further added that prices increase would only lead to further impoverishment of the ordinary citizen, questioning the government’s claim of subsidizing fuel prices.
The SCP member of politburo, Suleiman Hamid, said that the increase in prices has already been determined by the International Monetary Fund (IMF).
He accused the government of succumbing to the IMF in order to cancel Sudan’s external debt and to normalize its relations with the international monetary institutions, pointing to the frequent visits of the IMF teams to Sudan.
Hamid further described Sudan’s government relation with the IMF as “economic dependency”.
He said the SCP refused to meet with the finance minister following the ruling National Congress Party (NCP) decision to increase commodities prices, stressing that the Sudanese people would topple both the new measures and the regime.
The Sudanese government postponed the removal of subsides on several basic commodities as the NCP said its lift should come into force after concluding consultations with the political forces and civil society groups.
Qutbi al-Mahdi, a leading NCP figure, acknowledged that the NCP leadership is in disagreement over the decision but stressed that the majority believes that this has to be done at some point.
The sudden delay follows rumors about sharp divergences within the government ranks about these unpopular decisions which are seen necessary by the finance minister but disastrous by other members who fear that it will push people to take the street against the regime.
The Sudanese government cancelled an extraordinary cabinet meeting scheduled to be held last Sunday to endorse the increase of prices of basic commodities including fuel, without further explanations.
Different sources in Khartoum say the government delayed the implementation of the decision following recommendations from the security apparatus which reported a situation of public discontent against the government.
The Sudanese opposition umbrella organization known as the National Consensus Forces (NCF) announced that it is planning to organize public sit-ins to resist the government’s anticipated decision.
Also the Sudanese Revolutionary Front (SRF), an alliance of rebel groups issued a statement calling on their supporters inside the country to protest against the economic reforms.
However the finance minister Ali Mahmoud denied on Sunday that the cancellation is related to fears of demonstrations to protest such measures. The Sudanese people showed patience and accepted decision biggest and toughest than the removal of subsides, he said.
The NCP media secretary Yasser Youssef told reporters following a meeting of the political sector of the ruling party on Sunday that the announcement of these economic reforms depends on the completion of consultations with the political forces.
(ST)