When South Sudan seceded, Sudan lost almost 50% of its revenues and 80% of its foreign currency.

Figure 1: Government of Sudan revenues since 2005

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Source: IMF datasets

Oil exports plunged to zero and refinery sales fell by more than half.

Remember, Sudan is under financial sanctions and cannot turn to the IMF for assistance to see it through the economic shock.

Figure 2: Government of Sudan expenditures since 2005

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Source: IMF datasets.

Notice how capital spending hardly grew during the CPA Interim Period: the growth in spending was entirely on wages and transfers to the northern states and the Government of Southern Sudan, plus—in 2011-12—fuel and food subsidies. The only cutback immediately after the independence of the South was the end of the transfers to the GoSS. This is the background to the austerity measures of 2013, that brought people out onto the streets in protest.

More important for President Omar al Bashir than the shortage of money is the fact that the squeeze is where it hurts him most: the discretionary budget available for him as ruler. How does he obtain his “political budget” necessary to stay in power? That is the topic of the next (penultimate) post.

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One Response to (8) Visualizing Sudan: The Budget Crunch

  1. CrisisMaven says:

    As for (quote) “How does he obtain his ‘political budget’ necessary to stay in power?” – Most likely the same way Mugabe did it in Zimbabwe: inflating his way “out” of his crisis. And if anyone thinks that after that a ruler will be toppled: look again to Zimbabwe, where Mugabe is still going strong. The world community has not really ever yet hurt Bashir that much and esp. we have obviously not provided his people with a strong reason why they should oust him, i.e. what they’d gain by doing so. And the latest developments in Syria or Libya (or Iraq for that matter) make any oppressed people think twice if the should get rid of the “wolf they know”.

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