Sudan's gold export earnings have soared to $3.5 billion, according to a report by the Ministry of Minerals and the Central Bank of Sudan. The revenue, generated over the past ten months, marks a significant increase in export proceeds repatriated through official channels. The report also notes that the proportion of gold earnings paid into the formal banking system is expected to rise to over 80 per cent in the coming period.
Despite the substantial export revenues, the country's economic conditions continue to deteriorate. The Sudanese pound has collapsed against the rising dollar, and prices for goods in markets have not decreased. Economists and observers attribute the discrepancy to the large quantities of gold being smuggled out of the country. They argue that the revenues could help address the economic crisis if directed appropriately.
Economic expert Dr Haitham Mohamed Fathi attributes the lack of impact on the economy to the government's prioritization of spending on the war that began on 15 April 2023. He notes that the additional revenues have not been reflected in improved public services, such as healthcare and education. Citizens continue to endure dire humanitarian conditions, with no end to the war in sight.
Gold remains Sudan's most important export, accounting for 45-50 per cent of the country's total exports. In 2017, Sudan's gold production reached 107 tonnes, before falling to 42 tonnes in 2018. Production dropped to 6.5 tonnes in 2023, but rose to 64 tonnes in 2024. Dr Fathi notes that around 162 companies are involved in mineral exploration, including 40 foreign companies.
The mining sector faces several challenges, including smuggling, environmental damage, and security disturbances in mining areas. Dr Fathi stresses that large quantities of gold continue to be smuggled out of the country, and numerous mining markets operate beyond state oversight. The government has taken steps to bring gold under closer state supervision, including restricting the collection and marketing of gold to government bodies.
Dr Fathi calls for unified policies and regulatory measures to be applied transparently across all gold-producing areas. He urges the authorities to make better use of registered major foreign companies and activate large national companies to exploit this important national resource. Sudan has turned towards new markets in Egypt, Saudi Arabia, Qatar, and Türkiye to export its gold.
The economic crisis in Sudan remains severe, with citizens facing dire humanitarian conditions. The government's prioritization of spending on the war has not led to improved public services or relief for poor households. The surge in gold export earnings presents an opportunity for the government to address the economic crisis, but it remains to be seen whether the benefits will trickle down to the poor.
Key points
- Sudan's gold export earnings have reached $3.5 billion, but the benefits have not trickled down to the poor.
- The country's economic conditions continue to deteriorate, with the Sudanese pound collapsing against the rising dollar.
- Economists argue that the revenues could help address the economic crisis if directed appropriately.
