Cash runs out in Khartoum
Many cash machines in the Sudanese capital of Khartoum have run out of banknotes as the government scrambles to prevent economic collapse with a sharp devaluation and emergency austerity measures.
Many cash machines in the Sudanese capital of Khartoum have run out of banknotes as the government scrambles to prevent economic collapse with a sharp devaluation and emergency austerity measures.
Rising demand for cash due to ever rising inflation, lack of trust in the banking system and the central bank’s policy of restricting money supply in order to protect the Sudanese pound have contributed to a liquidity crunch that has worsened over the past 10 days pending new banknote deliveries.
The banknote shortage comes one month after authorities let the value of the Sudanese pound slide from 29 to the dollar to 47.5 and announced measures to tighten spending.
“I move from place to place until I find a money changer with funds because a large number of the cash machines are empty,” said Ahmed Abdullah, a 42-year-old government employee. “Why are we suffering like this to get our money?”
Sudan has suffered from a lack of foreign currency since losing three-quarters of its oil output when the south of the country seceded in 2011. The lifting of two decades of US sanctions in October 2017 did not bring a hoped-for reprieve.
Rampant inflation, strict withdrawal limits and a currency crisis had already placed Sudan’s economy in trouble before the latest liquidity crisis.
President Omar al-Bashir, who seized power in a coup in 1989 and whose governing party has said it will nominate him to run for re-election in 2020, has taken a series of steps to tackle the economic crisis in recent weeks.
A new central bank governor changed the system for setting the exchange rate and a new prime minister announced a 15month economic reform plan. The streets have been quiet after rare nationwide protests triggered by bread prices early in 2018. Over the past month the cost of a kilogram of flour has risen 20%, beef 30% and potatoes 50%. Sudan’s inflation stood at more than 68% in September, one of the world’s highest rates.