The Sudanese Ministry of Finance said on Tuesday that Sudan has canceled the customs exchange rate used to calculate import duties, the last step in the process of devaluing its local currency.
It also represented the last major step in an accelerated reform program monitored by the International Monetary Fund that Sudan is implementing in order to obtain debt relief and attract new financing. Read also Army markets in Sudan..a war on high prices and plans to spread Sudan’s dollar auctions ease pressure on the exchange rate… What is their impact on the black market? Sudan lifts fuel subsidies.. Measures to get rid of the customs dollar After the final liberation of fuel prices, the Sudanese government faces a difficult test
Earlier this month, Sudan completely eliminated subsidies on gasoline and diesel, and last February it devalued its currency, and began a policy of floating a flexible orbit.
The customs exchange rate, which was last set at 20 Sudanese pounds to the dollar, was used to value imports in order to calculate import duties.
Yesterday, the official exchange rate of the Sudanese pound was 438 pounds to the dollar, although the price on the black market was about 465 pounds.
The reforms are blamed for higher prices, with inflation increasing last May to 379 percent. The prices of imported cars increased in the past few days in anticipation of this decision.
The ministry said that it reassures citizens that this policy will not cause a rise in the prices of imported basic commodities or the prices of agricultural or industrial inputs.
It added that it has reduced import duties in general, and that the reduction is up to zero for some basic commodities.
“We conducted a commodity-by-commodity review,” a ministry official told Reuters, noting that duties on basic commodities such as cooking oil had fallen from 40 to 3%, while the impact of the policy would lead to higher prices for some non-essential commodities.
When Sudan devalued its currency last February, officials said some imports would be restricted in order to tackle the country’s huge trade deficit.
Sudan is implementing reforms in anticipation of canceling most of its debt, amounting to at least $50 billion, through the Heavily Indebted Poor Countries (HIPC) initiative.
On June 28, the IMF Board of Directors will take a decision on whether Sudan has reached the “crisis point” contained in the program. https://92b85f096e91182ca16b7dd1b7f7eb4f.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
The International Monetary Fund said – in a statement – that it was able to secure enough funding pledges to allow it to provide comprehensive debt relief to Sudan, according to what Reuters reported today, Wednesday.
He added that more than 100 member countries of the Fund pledged to provide more than 1.415 billion dollars in financing that would enable the settlement of Sudan’s arrears to the Fund.