Country Report Sudan March 2009

Outlook for 2009-10

• The Economist Intelligence Unit's central scenario is that a major political crisis will be averted in 2009-10, with the ruling National Congress Party maintaining control. However, there are significant downside risks.
• Strain will increase on the north-south Comprehensive Peace Agreement in the run-up to planned elections in 2009, and particularly as both sides rearm prior to the referendum on southern independence in 2011.
• Progress with economic reform will be limited, as the government is preoccupied with the political situation and unwilling to risk losing support from key constituencies. The fiscal deficit will average 2.2% of GDP in 2009-10.
• The world economy is now forecast to experience a recession in 2009, with global GDP growth shrinking by 1.5%, recovering only slowly in 2010. Brent crude will fall to an average price of US$45/barrel in 2009-10.
• Global economic and domestic political pressures will constrain the non-oil sector, and we expect real GDP growth to average 3.8% over the outlook period, well below recent levels.
• As commodity prices fall, inflation is projected to average 9.6% in 2009-10. The Sudanese pound will depreciate to an average of about SP2.30:US$1 in 2009 and SP2.42:US$1 in 2010.
• We expect the current-account deficit to widen sharply to an average of US$4.6bn (7.5% of GDP) in 2009-10.

Monthly review

• The International Criminal Court (ICC) has issued a long-expected arrest warrant against the president, Omar al-Bashir, for war crimes in Darfur. The government dismissed the court as a neo-colonialist instrument.
• The government has expelled 13 international non-governmental organisations, which employ 40% of humanitarian personnel in Darfur and deliver a large part of the aid, accusing them of passing information to the ICC.
• Hassan al-Turabi, one of Mr Bashir's arch-rivals, was released after two months in jail for speaking in support of the ICC. The release suggests that the government does not consider him to be a serious threat.
• The return to Malakal, Upper Nile, of General Gabriel Tanginyang, formerly the leader of a pro-government southern militia and now an officer in the Sudanese army, led to clashes with the SPLA in which 57 people were killed.
• The Merowe Dam, which will generate an average load of 625 mw, doubling Sudan's electricity supply, when it is completed, has been inaugurated by MrBashir, and the first turbine began operation.

Source: Country Report

This report covers the following industry codes:
SIC Code: 53;10
NAICS Code: 44;212