Sudan is geographically located at the crossroads of Sub-Saharan Africa and the Middle-East and stretches across the Red Sea. Sudan shares borders with seven countries including Libya and Egypt to the North, Chad to the West, the Central African Republic to the South-West, South Sudan to the South, Ethiopia to the South-East and Eritrea to the East.
The White and Blue Niles meet in Khartoum, the capital city of Sudan, and merge to become the Nile River that flows all the way to the Mediterranean Sea via Egypt. Sudan has a Sahelian belt with the desert in the far north, fertile land in the Nile valleys, the Gezira and across the rest of the country from Darfur to Kassala via Blue Nile and Kordofan States for farming and livestock herding.
For most of its independent history, the country has been beset by internal conflicts that weakened its ability to play a leadership role in the region. Under the terms of a comprehensive peace agreement in 2005, South Sudan seceded in 2011 and became the 54th independent State of Africa.
The secession of South Sudan induced multiple economic shocks. The biggest one being the loss of the oil revenue that accounted for more than half of Sudan’s government revenue and 95% of its exports. This has reduced economic growth, and resulted in double-digit consumer price inflation, which, together with increased fuel prices, triggered violent protests in September 2013.
The outbreak of civil war in South Sudan damaged both economies depriving Sudan of much needed pipeline revenues. The war in South Sudan also precipitated an increase in Sudan’s already large population of refugees and internally displaced persons with Sudan now serving as a source, destination and transit country for irregular migration, including refugees and asylum-seekers using the East African North-bound migratory route through Libya to Europe. The country hosts an estimated 763 thousand South Sudanese refugees and 159 thousand refugees and asylum seekers from Eritrea, Syria, Yemen, and Chad. The recent peace accord between the warring parties brokered by Sudan and Ethiopia appears to be holding, but the war damaged oil infrastructure, further eroding revenue availability to Sudan.
Following the global oil price slump in 2015/2016, Sudan and South Sudan agreed to lower oil transit fees for South Sudanese oil via Sudan’s pipeline, as it became inefficient to export it. In December 2016, they extended their 2012 agreement on oil for three years on the same terms, except for provisions to adjust transit fees in line with global oil prices.
Continuous food price hikes led to the December 2018 demonstrations which resulted in the removal of president El-Bashir from power in April 2019. This led to the formation of a Transition Government in September 2019. The power-sharing agreement between the military and civilian forces expected to last 39 months, allowed a civilian Prime Minister to lead the government under the authority of a Presidential Sovereign Council to be chaired by the military during the first 21 months followed by a civilian during the remaining 18 months. A transitional legislative assembly is expected to be established soon. On Wednesday July 22, 2020 the Prime Minister appointed 18 civilian Governors thereby achieving a key milestone included in the Constitutional Document of the transition.
Armed conflicts in Sudan’s westernmost region of Darfur have subsided but many parts of the region remain precarious because of the proliferation of arms and banditry. Efforts to settle conflict in South Kordofan and Blue Nile remain deadlocked. The Transitional Government has engaged in peace negotiations with relevant armed groups and signed a peace deal in October 3, 2020 with Sudan Revolution Front (SRF) expected to put an end to the long-standing conflicts that divert huge resources from much needed social programs and investments in human capital to military buildup.
In addition to the political and economic uncertainty, Sudan, like the rest of the world, has been experiencing the unprecedented social and economic impact of the COVID-19 (coronavirus) pandemic. The COVID-19 shock is expected to be transitory with potential recovery possible in 2021 but the overall adverse economic impact on Sudan will be substantial. The economic impact of COVID-19 includes the increased price of basic foods, rising unemployment, and falling exports. Restrictions on movement are making the economic situation worse, with commodity prices soaring across the country. According to the International Monetary Fund has already forecasted an overall economic stagnation in 2020 in Sudan.
Last Updated: Mar 22, 2021