---------- Forwarded message ---------- From: John Ashworth <[email protected]> Date: Fri, Jul 20, 2012 at 12:10 PM Subject: [sudan-john-ashworth] Prices soar in Sudan, protests continue To: Group <[email protected]>
1. Prices soar in Sudan, protests continue Friday, July 20, 2012 The News KHARTOUM: Sudan’s millions of poor have yet to surge into the streets to back scattered Arab Spring-style protests as government austerity measures try to stem soaring prices and a falling currency. Inflation reached 37 percent year-on-year in June and jumped almost 10 points in May but the demonstrations, sparked by high food prices, have been largely youth driven. “So far the movement is concentrated with students and protest activists,” one veteran activist said, adding it could take time for the “oppressed” poor to rise up. Sudanese history shows that “usually the poor join late”, following the professional classes, said University of Khartoum economist Mohammed Eljack Ahmed. But more than a month after protests began at the University of Khartoum there has been no mass support from professionals, although lawyers have demonstrated. “So far they are so limited,” Ahmed said of the protests. Demonstrations spread to include a cross-section of people, but often only in groups of 100 or 200. Protests have lately focused on Fridays at a mosque linked to the opposition Umma party in Khartoum’s twin city of Omdurman. Rallies have not attracted the tens of thousands of students, engineers, lawyers and trade unionists who toppled Sudanese military regimes in 1964 and 1985. Sudan, with more than 30 million people, has a poverty rate of 46.5 percent, the United Nations says. In its latest report on Sudan the World Bank described as “alarming” the 28.6 percent annual inflation rate reached in April, with prices having gone even higher since. The bank said food prices were mainly behind the inflation, which was “partly due to the rising import cost of basic goods as a result of weakening local currency value”. Sudan’s pound has tumbled on the black market from about four pounds per one dollar in September to around six now. Some say it could drop to 10 or more if inflation is not contained. The pound has been under pressure since South Sudan separated in July 2011, taking with it about 75 percent of Sudanese oil production that is worth billions of dollars and was the country’s largest source of hard currency. Loss of oil revenue has led to “serious external and internal deficits, inflation and economic hardship”, the World Bank said. Failure to agree with South Sudan on oil fees cost the Sudanese economy another 6.5 billion pounds ($1.48 billion), Finance Minister Ali Mahmud al-Rasul has said. The fees, which South Sudan would pay for exporting its oil through Sudan’s pipeline and port, are a major issue to be negotiated at African Union-led talks being held in Addis Ababa. Trying to address the fiscal imbalance, Sudan announced measures in June that Rasul said would save $1.5 billion. The government devalued the pound from 2.70 per dollar to 4.40, while sanctioning a trading band that lets the price range to 5.30, closer to the unofficial rate. An international economist said the “very significant” depreciation should lead to a balance of payments adjustment, boosting exports and curbing imports after the loss of oil revenues. But foreign reserves, needed to pay for imports, remain “very, very low” despite a “sizeable amount” that apparently arrived from offshore, said the economist, asking for anonymity. The government also said taxes on bank profits will rise along with value-added tax. It also cut five of 31 cabinet posts, trimmed ministers’ salaries and laid off presidential advisers. Another move led to a rise of about 50 percent in the pump price of petrol under a phasing out of fuel subsidies which had been set at 2.2 billion pounds this year. Despite the cut in subsidies there was a rise in social safety net spending, said Paul Jenkins, resident representative of the International Monetary Fund. On the revenue side the government measures were “quite solid,” he added. Past experience has shown that official social assistance funds failed to alleviate the suffering of low-income groups, said Ahmed. Rather than relying on government, most of the poor depend on traditional social support mechanisms through extended families, Ahmed said. “These traditional mechanisms are actually playing a main role in alleviating the seriousness and the suffering of these poor.” Rabbie Abdelatti Ebaid, a senior official in the ruling National Congress Party, also referred to traditional coping mechanisms. “We are not like others... We can share each and every thing with each other,” he said, adding that Sudanese survived worse economic crises in years past and current problems should be overcome within six months. “Because now a lot of work is underway,” he said. “We know what we are doing.” http://www.thenews.com.pk/Todays-News-3-121597-Prices-soar-in-Sudan-protests-continue END1 2. Sudan's currency hits low before Ramadan, stokes dissent Thu Jul 19, 2012 3:13pm By Ulf Laessing KHARTOUM, July 19 (Reuters) - Sudan's currency fell close to its historical low against the dollar as demand for imported food surged before the holy Muslim month of Ramadan, driving up prices and fueling anger over a severe economic crisis. President Omar Hassan al-Bashir, in power since 1989, has avoided an "Arab spring" but an austerity programme that included scaling back fuel subsidies sparked small-scale protests four weeks ago. Sudan lost much of its oil resources when South Sudan seceded a year ago, exacerbating an economic crisis and depriving the state of its main source of revenues and dollars. With Ramadan starting within a day or two, millions of Sudanese are stocking up on meat, spices and sweets to prepare the large meals they will eat in the evenings after fasting all day. Anti-government protests have so far been small but anger over food prices is rising. Prices usually go up in Ramadan but this year they add to an inflation rate of 37.2 percent, more double than a year ago. "It's the most difficult Ramadan we're facing because everything is so expensive. We are buying much less meat this year because we just cannot afford it," said Huda Abdullah, who works for a state university. "My four sisters, I and my father share our income but it's just not enough to buy enough food for a family," she said, checking grapefruit prices at Khartoum's central food market. The loss of oil revenues has exacerbated a dollar scarcity fuelling inflation because Sudan needs to import much of its food needs. Demand for imported food items needed for Ramadan meals, such as meat or sugar used for special juices and sweets, has knocked down the Sudanese pound close to an historic low. A dollar bought between 6 and 6.1 pounds on the black market on Thursday, close to a historic low of 6.2 reached in May when border fighting with arch foe South Sudan escalated. The central bank this month devalued the pound against the dollar by setting the exchange rate at between 4.3 and 4.7 from 2.7 previously to bridge the gap with black market rates. But a failure to pump sufficient dollars into the banking system makes import firms turn back to the black market. "You don't find sufficient dollars to satisfy demand. It's getting worse," one black market dealer said. Officials expect inflation to rise further as the government scales back petrol subsidies to help close the 6.5 billion pound ($1.4 billion) budget gap left by the loss of oil revenues. Traders in the dusty central market said prices for basic food items such as sugar have doubled since last year. "Sudan's food production is just too small to produce enough," said a trader who gave his name as Sherji. Shopper Sabah was fuming while buying vegetables for Ramadan. "Vegetables are so expensive, everything is expensive, expensive, expensive," he said. "Why aren't government officials doing anything? Don't they buy anything?" Youth activists have vowed to continue protests during Ramadan but it is unclear how many will heed the call as scorching heat keeps most people on fast indoors until sunset. Protests have been so far limited to students, lawyers, intellectuals and pro-democracy activists who have rarely mustered more than a few hundred people at a time. Bashir has dismissed the protests, saying Sudan will not see an Arab spring, just a hot summer. (Reporting by Ulf Laessing; Editing by Ruth Pitchford) http://af.reuters.com/article/sudanNews/idAFL6E8IJ8QT20120719?sp=true END2 3. Sudan Holds Largest Gold Reserves in Africa by Tom McGregor Dallas Blog Thu, Jul 19, 2012, 09:19 PM The Sudanese government is purchasing a large stockpile of gold, which it intends to sell for U.S. dollars needed to purchase imports such as food and other essentials. According to Reuters, “Sudan is looking to expand gold mines and boost production of the metal to help keep the economy afloat.” Previously, oil had been the main source of state revenues, including dollars, needed to pay for imports. However, Sudan lost three-quarters of its oil production when South Sudan declared its independence last year. As reported by Reuters, “a scarcity of dollars has driven the annual inflation rate of 37.2 percent in June, double the level of June 2011, and officials warn prices will rise further. The nation sits on what might be Africa’s largest gold reserves, while the government already handed out exploration contracts to more than 600 mining firms to search for gold and other minerals. One wonders if gold mining tycoon, George Soros, has recently invested in Sudan’s gold market. http://www.dallasblog.com/201207191009239/dallas-blog/sudan-holds-largest-gold-reserves-in-africa.html END3 4. Arab Spring countries reportedly intervening to reunite Sudan’s Islamists July 19, 2012 (KHARTOUM) – Each of Egypt, Tunisia and Libya are conducting an initiative to reconcile Sudan’s bitterly divided Islamists, a spokesman for the ruling National Congress Party (NCP) said on Thursday. According to the NCP’s political secretary in Khartoum State, Nizar Khalid, the regional-Arab initiative aims to re-unite their party with the opposition Popular Congress Party (PCP) led by Hassan Al-Turabi. Al-Turabi masterminded the rise of the National Islamic Front (NIF), later re-named (NCP), to power in a 1989 military coup before he was ousted ten years later following a bitter power struggle with President Al-Bashir and his former acolytes, chief among them is Vice-President Ali Osman Mohammed Taha. The veteran Islamist then moved with his followers to form the Popular Congress Party (PCP) and became one of the government’s most vociferous critics. “The initiative comes to resolve the Islamic, political and intellectual disagreements [between the NCP and the PCP]” Khalid, who was speaking to the Sudanese Media Center (SMC), a pro-government website, said before adding “these countries found that the solution to the internal crisis [in Sudan] cannot materialize without resolving the differences between the two big parties beside renewing the Islamic-political school of thought.” This development, if true, is likely to stoke concerns on the part of Western countries over the phenomenon of Islamist groups rising to power in post Arab Spring countries like the Muslim Brotherhood in Egypt and El-Nahda Movement in Tunisia. It also raises the possibility of these groups forging an affinity along ideological lines with Sudan’s Islamists. According to Khalid, the initiative leading countries “especially Egypt” recognize the importance of finding a “radical solution” to the fallout between the NCP and the PCP. He went on to say that the control of Islamist groups in Egypt, Tunisia and “Libya” has “revived the aspirations of Sudan’s Islamists to re-unite” The NCP official included Libya although its Islamists were soundly defeated by liberal forces in recent parliamentary elections. Khalid claimed that the initiative comes as “an extension” to a number of interactions that occurred recently between PCP and NCP members. He was, Sudan Tribune understands, referring to the gathering of “the Islamist movement Mujahdeen” which took place in the capital Khartoum on Saturday, 14 July. The said gathering brought together more than 500 of NIF “Mujahdeen” who fought in the civil war in the then southern region of South Sudan before it became an independent state last year. Some local newspapers reported that the gathering was highly emotive and witnessed intense discussions between the Mujahdeen from the NCP, PCP and even those who boycotted both factions when the split occurred. The positive tone in which the NCP official reported the alleged initiative is, however, lacking reciprocity on the part of PCP whose secretary of external relations, Al-Mahboob Abdel Salam, launched strong criticism against the ruling party on Thursday. Al-Mahboob, a close aide of Al-Turabi, said in an interview with Al-Madina newspaper that Al-Bashir regime bears the responsibility of “pushing the country to the brink” as he put it. “The Inqaz [NIF alias for its coup] regime has plunged Sudan into continuous wars, and drove the country’s sons to take up arms for the sake of gaining wealth and power” Al-Mahboob intoned that the current situation in Sudan is the cumulative sum of 23 years wrong policies in running the country. He accused Al-Bashir regime of causing the “economic collapse” of Sudan due to its failures in using oil revenues before South Sudan secession to diversify the economy. The talk of Islamists re-unification comes amid speculations of an imminent Arab Spring in Sudan as small but growing street protests sparked by worsening economic conditions continue to occur in different parts of the country. President Al-Bashir dismissed hopes for an Arab Spring in Sudan saying his country only has a “hot summer” that is burning his enemies. (ST) http://www.sudantribune.com/Arab-Spring-countries-reportedly,43312 END4 ______________________ John Ashworth Sudan, South Sudan Advisor [email protected] +254 725 926 297 (Kenya mobile) +211 919 695 362 (South Sudan mobile) +27 82 050 1235 (South Africa mobile) +44 750 304 1790 (UK/international) +88 216 4334 0735 (Thuraya satphone) PO Box 52002 - 00200, Nairobi, Kenya This is a personal e-mail address and the contents do not necessarily reflect the views of any organisation -- -- The content of this message does not necessarily reflect John Ashworth's views. Unless explicitly stated otherwise, John Ashworth is not the author of the content and the source is always cited. You received this message because you are subscribed to the Google Groups "sudan-john-ashworth" group. 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