Sudan is situated in northern Africa, with a coastline bordering the Red Sea. It sits at the crossroads of sub-Saharan Africa and the Middle East, with fertile lands, abundant livestock, and manufacturing. However, the country has been beset by conflict for most of its independent history and, under the terms of the 2005 Comprehensive Peace Agreement, the southern states seceded to form the Republic of South Sudan in July 2011. While this removed the key conflict in Sudan, disputes in Darfur, South Kordofan and areas bordering South Sudan such as Abyei are still ongoing.
Drivers of Fragility and Conflict
The near absence of inclusive public institutions that can adequately mediate demand for power and wealth sharing between the center and the periphery, has been an underlying source of fragility and conflict in Sudan. The unequal allocation of public resources and access to natural resources are main drivers of conflict, feeding into a potent mix of ideology, ethnicity and socio-economic marginalization that threatens to pull the country further apart.
The secession of South Sudan induced multiple economic shocks. The most important and immediate was the loss of the oil revenue which accounted for over half of government revenues and 95% of exports. This has left huge macro-economic and fiscal challenges with economic growth rates plummeting, rising consumer price inflation together with increased fuel prices which triggered country wide protests in September 2013.
Sudan did not succeed in use the oil windfalls to broadly diversify its economy or promote its private sector which perceives political instability, corruption and economic uncertainty as the main reasons for holding back investment and business development (2010 Investment Climate Assessment). Other constraints include inadequate infrastructure services (e.g. transport and electricity), access to finance and taxation policies.
Agriculture and livestock play important roles in food security and employment opportunities and it is estimated that the sector contributes 35-40% of gross domestic product (GDP). Under the Interim Poverty Reduction Strategy Papers (I-PRSP) and the emergency economic recovery program, the government has identified the agriculture and livestock sector as a priority and has committed to spending 20% of public expenditure on agriculture and livestock infrastructure and technical innovations.
However, Sudan remains a highly indebted country that has accumulated sizeable external arrears and has been in non-accrual status with the World Bank Group (WBG) since 1994. At the end of 2013, Sudan’s external debt stock stood at $45.1 billion in nominal terms, about 85% of which was in arrears. While the country is eligible for debt relief under the Highly-Indebted Poor Countries Initiative, it must come to an amicable understanding with South Sudan and its main creditors.
Poverty and Social Developments
Sudan has wide and deep swaths of poverty and stark inequality between regions. Poverty estimates set the average rate of poverty incidence at 46.5% (2009 National Baseline Household Survey), indicating that some 15 million people are poor. But within this the disparities are striking; poverty incidence numbers mask significant regional disparities. Poverty in urban areas (especially Khartoum) is significantly lower than rural areas, which account for 60% of the country’s population and 80% of its poor. Poverty incidence in North Darfur is approximately three times that of Khartoum and more than twice that of River Nile State. Also of note are the disparities between settled and nomadic populations who constitute 9% of Sudan’s population and 14% of its poor.
Gender-based disparities are also substantial with Sudan scoring very low in global measures of gender gaps and female empowerment. Severe gender gaps exist across a range of sectors, with rural areas faring worse than urban. In education, for example, nearly two-thirds of Sudanese women have less than primary education, compared to just over half of their male counterparts.
Human development indicators remain low and Sudan ranks at 171 out of 187 countries in the 2013 UNDP Human Development Index. Prospects for Sudan meeting the MDGs by 2015 are also bleak as is its progress compared to the achievements of some of its neighbors (most with lower per-capita incomes) as well as the Sub-Saharan average. For example, access to basic health services remains low, covering 40 to 50% of the population and regional disparities are particularly acute as health facilities are unevenly distributed. The child mortality rate (deaths per 1,000 births) is highest in Darfur (170), and lowest in Gezira state (63), while the national average is 111. Other services mirror this disparity. For example, access to safe drinking water remains low (44% in urban areas, 41% in rural areas), with many Sudanese relying on rivers, lakes, ponds, and wells due to the absence of piped drinking water.
Net primary school attendance rate is only 67% with huge disparities across states and gender. The 2012 Education Status Report notes the compounding negative impact of poverty, rurality, and gender, highlighting in particular that poor girls living in rural areas are among the least likely to access educational opportunities. Indicators for nomadic and displaced populations are also poor.
The main determinants of poverty in Sudan include:
- sustained and multiple conflicts, which undermine opportunities for economic and social development, which in turn feeds longstanding grievances driving fresh conflict
- a dependence on oil which has resulted in the neglect of agriculture and livestock sectors as well as alternative sources of energy
- the unequal distribution of fiscal resources and access to natural resources, especially between the center and the periphery, and
- governance failures as reflected in an inadequate policy framework and incentives for private sector investment.
Last Updated: Oct 10, 2014