Editorial:IMF and Sudan Economic Crisis IMF reported that Sudan’s economic indicators improved in the first quarter of this year owing in part to the lifting of fuel subsidies which took place about a year ago. Sudan has been struggling since the secession of the oil-rich South in 2011 to control soaring budget deficit and double digit inflation figures that have sent prices of basic commodities to record levels. To help navigate through its economic woes, Sudan asked to be placed under the IMF Staff-Monitored Programme (SMP) which is an informal agreement between a country’s authorities and the IMF to monitor the implementation of the authorities’ economic programme. SMPs do not entail financial assistance or endorsement by the IMF executive board. The latest SMP assessment released recently noted the improved fiscal performance in the form of increased revenues. Revenue amounted to SDG 11.3 billion or 2.9 percent of full-year GDP, representing a more than 60 percent increase over the first quarter of 2013. According to the report this performance reflects the increase in tax revenue and fuel stabilization fees. Tax revenue amounted to 1.5 percent of GDP, up from 1.3 percent of GDP in the first quarter of 2013. On inflation, the IMF maintained its projection that it will continue its downward trend thus bringing consumer price inflation down to single digits” The IMF also noted achievement of SMP targets with regards to monetary policy. However, the improvement in government revenue is due to lifting the subsidies which the citizens paid and that reflected in the deterioration of lives making the daily life a real suffering for the majority of citizens. It is apparent that the IMF happiness towards the improvement of government revenue indicates that they are aspiring for more lifting of subsidies in the upcoming budget and this is the new danger which will face the citizens. The IMF doesn’t provide any financial support to the Sudanese government to enable it overstep its economic crisis. The IMF should consider the social crisis resulted from the price hikes and the inflation due to the decline of Sudanese pound value. In return the government should not reconsider the situation before taking any step in lifting subsidies.
Posted on: Mon, 01 Sep 2014 11:21:42 +0000
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