KHARTOUM, Nov. 19 (Xinhua) -- The Sudanese pound on Sunday plummeted to a record low against foreign currencies in the parallel market, according to a Khartoum-based foreign exchange dealer.

The dealer told Xinhua on condition of anonymity that one U.S. dollar was traded for 1,030 Sudanese pounds in the parallel market on Sunday, compared to around 860 pounds in some local banks, while one Saudi riyal was exchanged for 275 pounds and the United Arab Emirates dirham for 280 pounds.

The dealer expected the pound to continue declining against foreign currencies due to the negative impact of the ongoing civil conflict and the severe scarcity of foreign currencies.

On April 14, before the outbreak of the civil conflict, the exchange rate of one dollar stood at 607 pounds in the parallel market.

Sudan has been suffering from a dire economic crisis due to a shortage in hard currency, high inflation, a budget deficit, and the continued hike in prices of basic commodities.

Speaking to Xinhua, an unnamed banking source attributed the depreciation of Sudan's national currency to the increased demand for foreign currencies, especially for the dollar, among importers, investors, and citizens, as well as their limited supply in the market.

He added the devaluation of the pound also reflected the government policy's failure to control the exchange rate.

Meanwhile, the Sudanese economic analyst, Abdul-Khaliq Mahjoub, said on Sunday that the exchange rate of the pound against foreign currencies has been negatively affected by the decreased export revenues from natural resources such as gold and oil, the increased war expenses, which exacerbated the budget deficit, and the declined hard currency reserves.

The World Bank said in its latest report that economic activities in Sudan are expected to contract by 12 percent because of the internal conflict.

In a recent economic study, a group of Sudanese economists echoed the World Bank's view and listed the most prominent economic impact of the ongoing civil conflict as the destruction of infrastructure, collapse of industrial sectors, shrinkage of economic growth, and loss of jobs.

The political turmoil also dealt a blow to Sudan's gold exports, a main source of its foreign currency. The total volume of gold produced by its corporate sectors dropped to two tons from mid-April to the end of August, compared to 18 tons in 2022, according to a recent statement from Sudan's state-run Mineral Resources Company.

Deadly clashes have been going on between the Sudanese Armed Forces and the paramilitary Rapid Support Forces in Khartoum and other areas since April 15, killing up to 9,000 people by October, forcing more than 6 million displaced and leaving 25 million in need of aid, according to the Sudan situation report released on Nov. 12 by the UN Office for the Coordination of Humanitarian Affairs. Enditem

Related

Go to Forum >>0 Comment(s)