Sudan’s economic growth was above 5.3% in 2015 and was expected to increase to above 6% in 2016 and 2017 mainly driven by agriculture and extractive industries, oil-transit fees, improved macroeconomic policies and foreign direct investment. Inflation declined from 36.9% in 2014 to 16.9% in 2015. The economic forecast is based on the assumption of strong agricultural revival, a gradual recovery of global oil prices, political stability in South Sudan, sustained inflows of FDI and a positive outcome from the national dialogue to end the civil war and conflicts. Spending on social development in 2015 was projected to remain at about the same level as was in 2014 (0.3% of GDP) and is not expected to rise in 2016.
Why invest in Sudan?
- Political and economic stability;
- Clear policies stated in the National Strategy for 2005-2029 ;
- The government is encouraging free economy and privatization in all fields in order to activate and encourage participation of private sector in socio-economic development;
- Simplification of investment procedures, provision of facilities, guarantees of incentives for investors and the invested capitals;
- The country has adequate natural resources and diversity of climate;
- The availability of qualified labour in the key sectors of the economy;
- The unique location of Sudan at the middle of the continent makes Sudan the centre of markets to supply neighbouring markets with goods and services.
The President of Sudan is Head of State, Head of Government and Commander-in-Chief of the Sudanese Armed Forces in a multi-party system. Legislative power is vested in both the government and in the two chambers, the National Assembly (lower) and the Council of States (upper), of the bicameral National Legislature. The judiciary is independent and obtained by the Constitutional Court. Sudan is widely recognized as an authoritarian state where all effective political power is obtained by President Omar al-Bashir through the ruling National Congress Party (NCP). However the civil war has tended to have diverted the focus of government from economic development to management of the war.
The estimated population of Sudan was 39.1 million people in 2017. The population is growing at an estimated rate of 2.4%
The urban population of Sudan is estimated at 33.2%
Doing business in Sudan
The highlights of World Bank score of doing business in Sudan are summarised as follows;
|Topics||World Bank 2017 Rank||World Bank 2016 Rank||Change in Rank|
|Starting a Business||156||148||
|Dealing with Construction Permits||145||144||
|Protecting Minority Investors||187||176||-11|
|Trading across Borders||184||184||
The government is in the process of creating conducive environment for doing business.
While Sudanese and foreigners are permitted to hold foreign currency accounts in private commercial banks, access to the currency can be delayed and/or limited without prior notification. Individuals and businesses often resort to obtaining hard currency on the black market. Local businesses may avoid holding significant cash in domestic deposit accounts all together. Sudanese authorities periodically crack down on dealers involved in unlicensed foreign exchange transactions.
The government can introduce changes to policies governing currency access, conversion, and capital repatriation without warning, and such changes generally become effective immediately upon announcement. Therefore getting foreign exchange is difficult because of hard currency shortages and can only be obtained through the Central Bank of Sudan.
Despite mandates in the 2013 Investment Encouragement Act promising compliance with international norms and regulations, Sudan does not regularly cooperate with foreign arbitration efforts. However Sudan’s investment law does provide for international arbitration. Sudan is a party to the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention). Sudan’s Arbitration Act of 2005 governs all arbitration matters, to include foreign investments.
Key development challenges
- Sustaining economic policy reforms and economic stability;
- Civil war and
- Meeting the country’s Millennium Development Goals (MDGs).
- Addressing the highly-indebted country status.
Sudan ranked number 170 least corrupt nation out of 175 countries and scored 14 points out of 100, according to the 2016 Corruption Perceptions Index reported by Transparency International.
Unemployment and skilled labour
Sudan’s labor force was estimated at 12.2 million in 2010, with a participation rate of 51.4% for those aged 15-64. The unemployment rate in 2016 is 9.5%. Underemployment is also a significant social problem, as the economy is not creating sufficient jobs for graduating university students. Sudan has signed and ratified all major International Labor Organization conventions protecting workers rights but falls short in practice of international standards.
Attitude to Foreign Direct Investment
It has been difficult for investors to do business in Sudan because of the just lifted economic sanctions, high taxes and frequent changes to the investment code.
Restrictions on Foreign investment
Despite the legal protections guaranteed under the National Investment Encouragement Act of 2013, there are foreign investment restrictions in the transportation sector, specifically in railway freight transportation, inland waterways barge service, and airport operations. Most telecommunications and media, including television broadcasting and newspaper publishing, are closed to foreign capital participation. Foreign ownership is also restricted in the electrical power generation and financial services sectors. In addition to those overt statutory ownership restrictions, a comparatively large number of sectors are dominated by government monopolies, including, but not limited to, those mentioned above. Such monopolies, together with a high perceived difficulty of obtaining required operating licenses, make it more difficult for foreign companies to invest.
Intellectual Property (IP) Rights.
The legislative framework on intellectual property rights (IPR) is adequate although there are often difficulties in enforcement nationwide IPR. The Sudanese Consumers Protection Society, the only consumer protection society in Sudan, has held seminars and issued warnings about counterfeit goods/pharmaceuticals that threaten public health and safety. The Sudanese Businessmen and Employers Association has also complained about IPR violations.
Petroleum; small reserves of iron ore, copper, chromium ore, zinc, tungsten, mica, silver, gold; hydropower
Information about Investment climate in Sudan has been summarized as follows;
Sources of information