The Central Bank of Sudan said - in a statement - that it issued instructions to banks to unify the official and parallel exchange rate, starting from today, Sunday, in a move expected to result in a significant devaluation of the Sudanese pound.
The measure aims to overcome a complex economic crisis and obtain international debt relief following a program from the International Monetary Fund, according to Reuters.
The central bank did not clarify the rate at which the exchange rate was decided to be unified, but analysts say that unification practically means moving to the parallel market price, given that almost all transactions are calculated at that rate.
Recently, the price of the dollar reached between 350 and 400 Sudanese pounds on the black market, compared to an official price of 55 pounds.
The exchange rate move was expected late last year under the IMF program, but was delayed due to political instability.
Objectives
The central bank said that the transitional government’s opinion has settled on adopting a package of policies and measures aimed at reforming and unifying the exchange rate system, by adopting the managed flexible exchange rate system (partial float).
The decision means that the Central Bank will have full powers to intervene in exchange rates in the event that they exceed a ceiling set by it.
In its statement, the bank stated that unifying the exchange rate will contribute to stabilizing the price, diverting resources from the parallel market to the official market, attracting remittances from Sudanese working abroad through official channels, and attracting foreign investment flows.
The new measure will also contribute to the normalization of relations with regional and international financing institutions and friendly countries, in a manner that ensures attracting grant and loan flows from these bodies, stimulating producers, exporters and the private sector by giving them the remunerative exchange rate, reducing the smuggling of goods and currencies, and bridging gaps to prevent speculators benefiting from a gap between The official price and the price in the parallel market, in addition to helping to work on exempting Sudan's external debts by taking advantage of the Heavily Indebted Poor Countries initiative.
The bank said that ensuring the success of the results of these policies and procedures requires the concerted efforts of all relevant authorities, including government agencies and the private sector, and the implementation of the economic reform package immediately without delay, and with full coordination.
Sudan suffers from renewed crises in bread, flour, fuel and cooking gas, as well as a continuous deterioration in its national currency, and a steady rise in inflation rates.
And last week, Sudanese data showed that the country's annual inflation rate rose to 304.33% last January, from 269.33% in the previous December, according to Anadolu Agency.