Despite the “positive effects” of the lifting of U.S. sanctions on Sudan, the move alone is not enough to solve all the difficulties that the Sudan’s economy confronts, local economists have agreed.
“It must be noticed that the sanctions were not the only challenges that Sudan’s economy faces,” Mohamed al-Nayer, a Sudanese analyst, told Xinhua. “There are other challenges such as the external debts and instability in some neighbouring countries.”
“The decision has a positive influence on the economy in medium and long term including production increase, exports growth, encouragement to flow of foreign exchange and reduced demand for foreign exchange, as well as reduced trade balance deficit which currently stands at 5 billion U.S. Dollars annually,” said Nayer.
The lifting of the sanctions also has a short-term effect, as there has been a great decline in the exchange rate of foreign currencies against the Sudanese pound, he said.
According to Nayer, it is important for the Sudanese government to take immediate measures to maintain the positive effects of the lifting of sanctions, “incentives must be issued to attract remittances of Sudanese working abroad and the Central Bank must modify policies of gold transactions.”
On the other hand, it is necessary to find an effective formula to increase industrial and agricultural production as well as the export volume, said Abdul-Rahim al-Sunni, a Sudanese economist.
“It is true that there is a sudden decline in the exchange rate of foreign currencies at the parallel market, but it will be temporary, unless the government can make use of the U.S. lifting of sanctions to obtain foreign currencies through export growth,” Sunni told Xinhua.
The United States decided on Friday to lift its two-decade economic sanctions on Sudan permanently, stressing the importance of Sudan’s sustained positive actions to fight terrorism and improve the humanitarian situation.
The United States has been imposing a series of sanctions on Sudan since 1997, including restrictions on exports, imports and flow of currency.
No accurate data has been published on Sudan’s total loss due to the sanctions, however, it is estimated at a total of around 500 billion dollars, or 4 billion dollars annually.
The sanctions have been a blow to Sudan’s banking, transport and infrastructure sectors.
Sudan’s banks have shut down the global financial departments, as the previous U.S. sanctions banned all kinds of commercial and financial transactions with Sudan.
Sudan Airways has also suffered from a decline in its global ranking as a national carrier since the United States denied its access to purchasing spare parts and regular maintenance for its planes.
Most trains in Sudan have stopped operation, with an 83 percent loss of the infrastructure along its railways.
In the health sector, import of medical equipment and medicines from the United States has been prohibited, causing a decrease in the efficiency of medical laboratories.