France will lend Sudan $1.5 billion to help it clear its debt to the International Monetary Fund, the French government said.
On Monday, Paris hosted a conference to support Sudan’s transition to democracy after decades of authoritarian rule under dictator Omar Al Bashir, who was ousted in 2019.
Khartoum hopes the talks in Paris will help it clear some of its foreign debt, estimated to be at least $60bn, after decades of isolation.
Sudan’s Prime Minister Abdalla Hamdok listed a series of significant economic challenges his transitional government inherited, including a collapsed economy, empty treasury, and severe shortages of basic commodities such as fuel, bread and medicine.
He also mentioned the challenges faced by rampant inflation – currently above 300 per cent – and a weak exchange rate, problems exacerbated by Covid-19 and devastating country-wide floods last autumn.
His government has put in place a series of economic policies in recent months, including a managed flotation of the Sudanese pound – a key demand of the IMF.
About 38 per cent of Sudan's debt is owed to the Paris Club, a body made up of major creditor countries.
"It's important that the direction of courageous economic reforms you have started implementing continues to guide the transition," French President Emmanuel Macron said.
"The reduction of the Sudanese debt that we’ll start soon is a first result of these reforms and the return of Sudan in the international community must be strengthened at the economic and political level.”
Mr Hamdok said sustaining peace in Sudan required “a functioning if not strong economy”.
“Therefore addressing the economic crisis has become our top priority,” Mr Hamdok said.
He pledged a “clean break” with the past in an effort to achieve long-term development and peace, and said the removal of Sudan from the US list of state sponsors of terrorism was a “game changer”.
But Mr Hamdok lamented the vast number of Sudanese people who have attempted to cross the Mediterranean Sea in search of a better life in Europe.
“I can't stress enough the need to build a productive economy … creating jobs for our young people is one of the most important priorities.
"We would like to create those opportunities for our young talent to stay in the country and build it with us, rather than taking this extremely difficult and dangerous journey across the Mediterranean.
General Abdel Fattah Burhan, the head of the ruling sovereign council, praised a “historic opportunity” for Sudan and shared a “message of peace and of co-operation”.
Mr Macron described Sudan’s transition as “an inspiration”. The international community, he said, had a collective responsibility to help the country achieve its ambitions.
"Despite the difficulties, considerable progress has been made since the fall of the old regime," Mr Macron said.
French Finance Minister Bruno Le Maire expressed similar sentiments. "Rebuilding an attractive and resilient market takes time but today I hope we will convince private investors that the fundamentals for business are fully there,” he said.
Speaking before the conference, Mr Hamdok said he was seeking investment to help rebuild Sudan’s devastated economy.
"Sudan is a very rich country, we don't want handouts, we want investments," he said.
Sudan recently cleared arrears with the World Bank and the African Development Bank with bridge loans from Western states.
Egyptian President Abdel Fattah El Sisi was among the leaders taking part in the conference.