Sudan PM Abdalla Hamdok announces foreign investment plan after debt relief boost
France leads international effort to bring economic stability to the transitional government in Khartoum
Sudanese Prime Minister Abdalla Hamdok sought to market his impoverished country to European business leaders as an attractive investment destination on Tuesday, a day after Khartoum cleared a final hurdle to receiving broader relief on its $50 billion foreign debt.
We are in a much better position now to implement these plans
PM Abdalla Hamdok
“We have often said that Sudan is a rich nation that has no need for grants. What it really needs is investment that will create jobs for our youth,” Mr Hamdok told European investors in a meeting in Paris on Tuesday.
“We need to see genuine investments coming to our country and working with us.”
Mr Hamdok, a career UN economist who became prime minister in 2019, echoed the same appeal in a separate meeting in Paris with French investors on Tuesday.
“We are talking about serious plans ... we are in a much better position now to implement these plans,” he said.
Sudan has a diverse and rich variety of natural resources, from farmlands to gold mines, and potential tourist attractions such as ancient archaeological sites and diving spots in pristine Red Sea waters.
It has perhaps Africa’s largest agricultural potential and Sudanese officials displayed projects in Paris worth billions of dollars in energy, mining, infrastructure and farming.
Sudan has been in and out of economic crises since it gained independence in 1956, with the cycle of military rule, dysfunctional elected governments and civil wars constantly feeding instability and hampering efforts to reform the economy.
Widespread corruption under the 29-year rule of former dictator Omar Al Bashir devastated the economy, which could not recover from the loss of most of the country’s oil wealth when the southern region seceded in 2011 at the end of two decades of civil war.
The loss of the oilfields led to Sudan's worst economic crisis, which was the chief cause of a 2018-2019 popular uprising that paved the way for the military to remove Al Bashir in April 2019.
At least 100 people were killed during a short but bloody popular protest movement that ousted the military government.
But the economic woes – faltering currency, shortages of basic goods, 300 per cent inflation and a fall in productivity owing to the coronavirus pandemic – endure to this day despite moves to reform the economy, such as devaluing the currency and removing state subsidies on fuel.
Political instability is also an issue.
Troops shot dead two protesters last week and injured at least 16 in Khartoum. On Monday night, the country’s chief prosecutor stepped down and the head of the judiciary was fired. No official explanation was given for either decision.
But there were some encouraging signs this week in Paris, where French President Emmanuel Macron hosted an international conference to help Sudan through its post-Al Bashir period.
Mr Macron started the meeting by declaring his intention to cancel the $5bn debt owed by Sudan.
France also confirmed it would facilitate clearing Sudan’s arrears to the International Monetary Fund through a $1.5bn loan covered by pledges made by member states, removing the final hurdle before Sudan can gain relief for its foreign debt.
Sudan has already cleared its arrears to the World Bank and the African Development Bank with loans from western donors.
With debts to multilateral lenders settled, Sudan can move forward and settle its estimated $38bnn bills to bilateral creditors. An additional $6bn of its external debt is commercial in nature.
Sudan's Ministry of Foreign Affairs said in a tweet that Italy and Germany committed to clearing their share of Sudan's debt, which total $1.8bn, according to IMF estimates.
Norway said it would cancel the $100 million owed to them.
Kuwait, Sudan's largest creditor at $9.8bn, said it would support debt-resolution discussions, while Saudi Arabia, another major creditor, said it would press strongly for a broad agreement on debt.
Updated: May 19, 2021 03:08 PM