SUDAN

Key conditions andchallenges

Table 12023

Population, million

48.1GDP, current US$ billion

109.3

GDP per capita, current US$2272.5

International poverty rate ($2.15)

a15.3
a49.7

a86.2

Lower middle-income poverty rate ($3.65)
Upper middle-income poverty rate ($6.85)
Gini index

a34.2

School enrollment, primary (% gross)

b77.8

b65.3

Total GHG emissions (mtCO2e)

126.6

Life expectancy at birth, years

Source: WDI, Macro Poverty Outlook, and official data.
a/ Most recent value (2014), 2017 PPPs.
b/ WDI for School enrollment (2018); Life expectancy(2021).

Real GDP is expected to contract further
by 3.5 percent in 2024, after a 12 percent
contraction in 2023, driven by widespread destruction of productive capacity
due to the domestic conflict, and weak
private consumption and exports. Inflation averaged 230 percent in 2023, andthe currency has depreciated by 125 percent. The collapse of government institutions has disrupted public spending andthe exodus of people has reduced the tax
base. Poverty remains widespread, andfood insecurity is extremely high.

The armed conflict that erupted in April
2023 has caused severe and long-lastingdamage to the economy, the industrial base,education, and health facilities. It has also
led to a collapse in domestic demand andeconomic activity (including commerce, financial, and information and communications technology services) and is erodingstate capacity. Fighting has spread acrossthe country and reignited hostilities in traditionally restive regions, such as Darfur
and Kordofan. This in turn is impacting
agriculture and trade, and exacerbating
food insecurity and displacement.
Decreased local crop production seriously
threatens food availability. Direct fighting,displacement of civilians, and looting areaffecting farming and harvesting activities.
The conflict is also exacerbating challenges
linked to shortages of agricultural machinery, extremely high fuel prices, and scarcity of labor. Sudan faces extreme levels offood insecurity, with 17.7 million people(37 percent of the population) experiencing
acute food insecurity.
The currency has declined sharply against
the US dollar, depreciating to unprecedented levels given the high demand for foreign
currency in response to both the crisis andrelated damage to the banking and payment
systems. In particular, the electronic banking system stopped functioning for a time in
October 2023. Since then reports are thatbanking applications have operated on aFIGURE 1 Sudan / Real GDP growth and sectoral
contributions to real GDP growth

limited basis. As of end-March 2024, the exchange rate stood at SDG 1150 in official
banks and SDG 1350 in the parallel market,
a stark contrast to the pre-war rates of SDG
580. Exports now take alternative routes toestablished channels due to decreased production. Smuggling has become common in
evading high duties, resulting in export revenues remaining outside Sudan’s official
banking system.

Recent developments
Amid the ongoing conflict, productive
capacity has suffered drastically, andboth private and government consumption have plummeted. Export volumes
shrank and major external financial support and investment has been cut off. As
a result, the economy is expected to contract for a seventh consecutive year in
2024, by 3.5 percent, after an estimatedcontraction of 12 percent in 2023.
Inflation has become more difficult tomonitor. Indications are that rents havesoared in safer areas, fuel costs havesoared across the country, and food prices
have risen sharply in areas of scarcity but
plummeted in pockets of oversupply as
people have fled and sold off their produce. Inflation is estimated to have risen toabout 230 percent in 2023. In 2024, Sudan
topped the International Rescue Committee
watchlist of countries most likely to experience a deteriorating humanitarian crisis.
The currency has significantly depreciatedby 94 percent in the official and 125 percent
in parallel markets since April 2023, and theFIGURE 2 Sudan / Actual and projected poverty rates andreal GDP per capita

Percent
2Poverty rate (%)
100

800

090700Real GDP per capita (constant LCU)

80

600

-2

70-4

60

500

50

400

-6

40

300

-8

30

200

20-10-12-14

2018

2019

2020

2021

2022

100

10

Agriculture
IndustryServices
Gross value added at basic prices

00
2009 2011 2013 2015 2017 2019 2021 2023 2025

2023 2024e 2025f 2026f

Sources: National Bureau of Statistics and World Bank staff calculations.

International poverty rate

Lower middle-income pov. rate

Upper middle-income pov. rate

Real GDP pc

Source: World Bank. Notes: see Table 2.

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Apr 24

premium between the parallel and official
rate has widened significantly, standing at
17.4 percent as of March 2024, compared to
1.7 percent in March 2023. This reflects a relativeincreaseindemandforUSdollarsamid
an increasingly unregulated exchange marketaswellasforeigncurrencyshortages.
The shock to the economy and public institutions, coupled with the disruption ofbudget execution has caused a contractionin spending and revenue. Despite theheavy costs of the conflict, spending declined, as the conflict caused a marked
drop in subsidies and wages. The large exodus of Sudanese and foreign nationals involved in commerce and business shrank
the tax base. Consequently, the fiscal deficit
is estimated at 3.5 percent of GDP in 2024.
The current account deficit is expected towiden to 6.9 percent of GDP in 2024 as
agricultural and mining exports were hit
by the fighting and both sides look to control productive assets. Sudan’s external position is undermined by considerable capital flight and disinvestment due to thehighly uncertain political outlook.

Outlook
The outlook remains highly uncertain. It
is based on a gradual cessation of conflictover the coming year; however, it remains
subject to large downside risks from prolonged conflict and tensions. Given theconflict-related economic losses and destruction of infrastructure, the economy isprojected to contract by 3.5 percent in 2024
and 0.7 percent in 2025. Inflation is forecast
to decline to 180 percent in 2024, reflecting
an adjustment of the base effect.
Modest economic growth is expected from2026, assuming the inflows of international
funding resumes. The economic recovery
is expected to be driven by the reconstruction of public infrastructure initially, assuming that the political upheaval begins
to ease and other macroeconomic fundamentals improve from 2026. The conflict ispredicted to lead to a drastic reduction ineconomic output across all major productive sectors, including mining, agriculture,TABLE 2 Sudan / Macro poverty outlook indicatorsand oil. Gold mining and agriculture areexpected to be the main drivers of growth
after the conflict de-escalates.
With a gradual stabilization in the political and economic situation, inflation is projected to decrease further to80 percent in 2025 and 45 percent in
2026. Sudan’s foreign currency shortages and currency depreciation are expected to persist throughout 2024-26,
as investment and other sources offoreign exchange, such as aid flows,slowly resume.
The fiscal deficit is expected to narrow
as revenue increases (in line with amodest recovery, assuming the conflictsubsides) from 2025 onwards, backed
by reconstruction efforts. The current
account deficit is expected to widen
throughout 2024-26, driven by an increase in the trade deficit, given highimport requirements (first, due to thewar and later to meet reconstruction efforts). This should be accompanied bya gradual recovery in domestic demand
and a partial recovery in exports.

(annual percent change unless indicated otherwise)

Real GDP growth, at constant market prices
Private consumption
Government consumption
Gross fixed capital investment
Exports, goods and services
Imports, goods and services

2021
-1.9
-0.9
-9.6
-2.1
8.0
-0.5

2022
-1.0
-0.8
1.9
1.2
12.0
8.7

2023e
-12.0
-10.6
-36.5
-20.0
-32.0
-36.0

2024f
-3.5
-3.1
-14.0
-20.0
-20.0
-18.0

2025f
-0.7
-0.9
-4.9
-1.5
-9.0
-14.0

2026f
1.2
1.4
3.0
1.8
5.0
8.0

Real GDP growth, at constant factor prices
Agriculture
Industry
Services

-1.9
-0.6
-0.7
-3.9

-1.0
1.0
-0.7
-3.0

-12.0
-7.9
-11.6
-16.0

-3.5
-2.0
-3.0
-5.5

-0.7
1.1
-1.5
-2.0

1.2
1.1
1.0
1.6

359.7

164.2

230.0

180.0

95.0

60.0

-7.3
-1.6

-6.0
-1.3

-0.6
-0.7

-6.9
-0.9

-7.2
-0.7

-7.5
-0.5

-0.3
10.5
215.6
-0.3

-1.7
10.0
183.6
-1.4

-3.8
4.8
167.3
-3.7

-3.5
5.5
158.5
-3.5

-3.2
6.2
149.5
-3.2

-2.8
6.5
139.3
-2.8

25.0
62.2
91.2

26.9
63.8
91.8

34.5
71.0
93.8

37.4
73.7
94.4

39.0
75.0
94.7

39.6
75.5
94.9

1.1
17.6

-0.4
17.3

-1.9
15.5

0.0
16.6

1.7
18.0

2.5
19.6

Inflation (consumer price index)
Current account balance (% of GDP)Net foreign direct investment inflow (% of GDP)
Fiscal balance (% of GDP)
Revenues (% of GDP)aDebt (% of GDP)
Primary balance (% of GDP)b,cInternational poverty rate ($2.15 in 2017 PPP)b,cLower middle-income poverty rate ($3.65 in 2017 PPP)b,cUpper middle-income poverty rate ($6.85 in 2017 PPP)
GHG emissions growth (mtCO2e)
Energy related GHG emissions (% of total)

Source: World Bank, Poverty & Equity and Macroeconomics, Trade & Investment Global Practices. Emissions data sourced from CAIT and OECD.
Notes: e = estimate, f = forecast.
a/ Debt projections do not include any restructuring achieved during the HIPC process.
b/ Calculations based on 2014-NBHS. Actual data: 2014. Nowcast: 2015-2023. Forecasts are from 2024 to 2026.
c/ Projection using neutral distribution (2014) with pass-through = 0.7 (Low (0.7)) based on GDP per capita in constant LCU.

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