Health Check on Sudan Economy: Problems and Opportunities By Ramah Ahmed

04:25 PM September, 04 2016

Sudanese Online
Ramah Ahmed رماح أحمد-
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The issue of whether or not there is a possible progress in Sudan economy has been unresolved for many years. The absence of figures and actual data could be a significant reason, beside the worse political climate. One can argue that the National Congress Party (NCP) is responsible for not providing a well-structured economic plan that can contribute to the majority of the population. The unity in the Western countries can be an example, after the Second World War a set of economic policies were introduced to overcome the destruction that resulted from the War. They unite together and form a number of agreements for the benefit of the entire region. This is supposed to teach us a lesson which is the need for unity to build a strong nation away from hate and destructive wars. It is clear to say the contribution in the economy has a direct link with the entire stability of the country. This article will examine the elements of successful economic, by which highlights the production factors such as raw materials and human capital as a significant asset. It also stresses the difficulties associated with achieving economic stability, and the solutions waiting ahead for better economic prospect in Sudan.

First and important thing in economics is the transparency of data. The nature of trade is based on import and export and this is must be accompanied with clear figures. These figures determine the national currency value in the face of the US Dollar by which determines the economic efficiency. The lack of economic data leads to produce incredible results which have no basis of truth. The production of such untrue information makes the process of forecasting the future economy extremely inadequate. So, it could be argued that the need for transparency in economic data remains vital for economist to build their strategies on the basis of realistic ground. Second essential point which is the market condition where the business transaction occurred, the lack of policies could also impact the economics transaction by several means. The trade laws in Sudan have been ineffective for a long time with the consideration of the lack of enforcement institutions. By which traders are able to perform their businesses without any law enforcement, alongside the government limitation in controlling of imports, subsidies on commodities and taxation. As a matter of fact, the underlying issue behind the absence of trade laws will result in widespread corruption. The trade becomes clearly unfair and without rules governing its operations, such these neglects have negative influences on the overall economy and the development of several sectors.

In addition to that, the peoples' behaviour in social terms is heavily become interested and this will impact on the economy in particular with purchasing power. Perhaps, one can bring other crucial issues such as corruption and other behavioural issues these may also drive the economy to a bad position. For example, the agency problems are a considerably high in most of businesses in Sudan by which the agent demand commission on any business transaction on believing that he facilitate the purchasing process. By other words, the agent makes the price higher than it’s the value of the asset; bearing in mind the agent has no significant contribution. Thus, the increase in agents has a clear drawback on the economy and put a more substantial burden on the existence inflation. Third issue and in line with the political atmosphere is the rise of unemployment, many public and private organisations relying heavily on relative and social relationships when it comes to hiring employees alongside the loyalty to the regime. Perhaps, this way of hiring deliver people with the same skills and the organisation enjoys the bargaining power in the reward system, promotion and pension scheme. Profoundly, when the organisation has a higher bargaining power over its employees this will likely contribute to unfair working environment. Consequently, this will result in many qualified and professional will leave the country and favour to work abroad. The other devastating problem in the labour market is the lack of skilled labour which will drive us to another issue which is the education system. This is also an issue cannot be ignored as pivotal for the growth of many industries, that affects the learning growth cycle for the current and future of the workforce. It is therefore highly important to relate the human capital and work regulations as a driven factor for economic growth.

Noticeably, the NCP political figures have higher chances to trade and establish businesses, unlike other business oriented individuals who have fewer chances to enter the market. These factors introduced clearly considers as problematic in the nature of delivering a strategic economic plan. The lack of formal institutions creates a real barrier in achieving economic stability. Thus, The ideology of the NCP to remain in power and being the only party whom their members are having a better chance to trade and not giving the chances for the establishment of a fair business environment. These factors have a direct impact on Sudan economy and leads to a total destruction.

With no hesitation, it seems safe to say that the internal resources in Sudan are greatly invaluable the agriculture and animal resources as examples. These resources could be a great asset for a trade, the internal resource capabilities and the human capital could be driven factors for a successful economy. It is worth to look into the study of the WANA region (The West Asia, North Africa), which listed Sudan as one the most disadvantaged economic state along with Eritrea, Ethiopia and Somalia. The study compares the three elements which are poverty, agricultural employment and migration. Poverty in many WANA countries is masked by averaging the poor with the rich. Consider Libya, Oman, Saudi Arabia, Kuwait and United Arab Emirates as examples of the major oil exporters. We find large disparities between these and the remaining WANA countries. The oil exporters with only 7 percent of the region's population represent the region's highest per capita GNP, averaging just over US$9,400 which, even so, is only a quarter of the per capita GNP of industrialized countries. The remaining 93 percent of WANA's population has a far lower per capita income. The four most economically disadvantaged states of South WANA (Eritrea, Ethiopia, Somalia and Sudan) have a per capita GNP of only US$88 that is less than 1.2 percent of the oil exporters with small populations. In fact, 42 percent of the total population of 239 million people has a per capita GNP of less than US$1.0 per day and is thus in the grip of severe poverty. These figures emerged as there is indeed a lack of management knowledge within the policy makers, the process of finding solutions is clearly not prioritised. So the question that could be stressed here, what exactly the future will look like. The end of poverty should be a department name within the entire ministries; this may be a bounded rational solution. The suggested department should be under highly qualified people and advisers to operate in the health, education, commerce, justice, etc. Although the bounded rationality is often biased to only one direction, there is a more rationale solution which is regime change. This could be realistic and sound most acceptable decision as long as the bottom line is to improve the overall economy. The closure of unnecessary government departments will save the costs of its operations for the purpose of building valuable projects. Arguably, this change could form many opportunities for the Sudanese people’s living conditions and tackle the issues of poverty. Therefore, it is an opportunity to highlight that politics, economics and social context are disciplines must be integrated and determine any decision for the favour of positive economy.



Finally, the collapse in economy underlines many issues which are the political and social aspects. The effective trade must be fair, under trusted climate and social responsibility. The article also outlined the lack of economic data as problems in Sudan by which is inconsistent and does not direct to a sustainable economic future. Clearly, the article brought the problem associated with the employment law and work regulations are imperfect, despite the facts these are the role of the game. In addition, the rise of unemployment and the changing behaviour of people within issues underpinning the agency problems have brought to the debate. The article also examined the realistic information based on the ground, which describes Sudan as a country of wealth in term of food security and the data published from WANA study which indicated that Sudan has severe poverty. The need for urgent solutions has to be deployed or otherwise there were more complex situation and the problem will escalate and more likely is unresolved.




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