Sudan’s huge debt impacts on external financing

by Trust Matsilele 0

The International Monetary Fund (IMF) says its staff will remain engaged with the authorities to monitor progress in the implementation of the authorities’ economic programme.

The fund explained that it will continue providing targeted technical assistance to support Sudan’s capacity-building efforts, its adjustment and the reform programme.

According to the IMF, the authorities have implemented measures aimed at lowering inflation at the end of March believed to have pushed the country towards a positive outlook.

“The outlook for 2014 remains broadly favourable, with growth expected to reach 2.5 per cent, and inflation to continue its downward trend to about 18 per cent,” noted the IMF.

“The authorities have reiterated their continued commitment to the policies under the SMP and continued support for peace efforts in South Sudan to enhance stability in the region.”

(READ MORE: Gunfire erupts in South Sudan capital, talks delayed)

The IMF’s executive board met recently to discuss the first review of Sudan’s performance under its Staff-Monitored Program (SMP).

An SMP is an informal agreement between the country authorities and the fund staff to monitor the implementation of the authorities’ economic program.

“The Sudan authorities’ performance under the SMP has been broadly satisfactory despite the major challenges the country has been facing since the July 2011 secession of South Sudan,” the fund explained.

“The authorities have taken corrective measures to ensure implementation going forward. The uncertain political transition, the volatile domestic oil market, and the fragile security environment may slow down the reform momentum.”

(READ MORE: South Sudan oil output steady)

The fund said the country needed to enact urgent measures to address the gap between the official and curb market exchange rates.

“The curb market exchange rate for the local currency depreciated against the US dollar on account of the uncertainties in the oil market triggered by the South Sudan conflict, thus widening the gap between the official and curb market rates to more than 50 per cent.”