SUDAN INSIGHT ALERT: Reuters - Analysis: Delay in currency reform puts donor support for Sudan at risk
Reuters’ feature piece reports on pressure facing Sudan’s new cabinet to devalue the currency in order to gain debt relief and international financial support, and thereby support the prospects of civilian rule. Currency reform delays have been attributed to fear of public reaction, leftist resistance to IMF-led reforms, and the search for a buffer of foreign reserves.
Sudan’s donors and lenders say unifying the exchange rate would not trigger significant further pressure on the currency or inflation since almost all transactions are already carried out at black market rates. Sudan is printing less money, which should ease inflationary pressure and has made progress on other benchmarks including beginning to publicly list details of state-owned enterprises, they say.
However, the delay in exchange rate reform is withholding $400 million in aid and World Bank pre-arrears clearance grants.