War costs cloud otherwise bright economic outlook

Sudan’s oil exports were expected to reach US $1.7 billion this year, more than double the estimated earnings in 1999. Combined with a recovery in agricultural exports, this would leave Sudan with a trade surplus of some US $230 million, its first such surplus in over 20 years, the Economist Intelligence Unit forecast on Monday. The overall current account would remain in deficit, however, as foreign oil firms recouped investments and repatriated profits, and as an improved relationship with the IMF caused Sudan to pay more in servicing its external debt, the EIU said. While increased export volumes and high government expenditure expected to drive GDP growth to around 7 percent this year, the war would remain “a heavy burden on state finances” and hold back privatisation, which was an integral part of Khartoum’s economic liberalisation policy, the report added.