Sudan’s current macroeconomic environment of low growth, high inflation and a constrained fiscal space; and Social Safety Net (SSN) programs which exist but are limited in coverage; have joint and individual implications on the resilience and vulnerability of households to shocks. The economy which continues be characterized by adverse events (such as rising inflation and currency devaluation) triggered by macroeconomic reforms following the secession of the South increases the vulnerability of households to poverty and lowers their resilience to shocks (World Bank 2018). Furthermore, the loss of oil revenue after the secession imposes budget constraints on government’s activities including financing existing social protection programs (which receive an estimated 1 percent of Sudan’s GDP) to increase access and coverage. Sudan has a comparatively well-established social protection system. There are fourteen (14) SSN programs compared to an average of fifteen (15) in the continent and twenty (20) in lower middle income countries. These programs range from unconditional and conditional cash transfers, in kind programs, school feeding, health insurance among others; and benefit an estimated 88 percent of the Sudanese population (World Bank, Atlas of Social Protection Indicators of Resilience and Equity - ASPIRE).<sup>2</sup> The presence of these programs is a necessary but not sufficient condition to build the resilience and lower the vulnerability of households to shocks. Furthermore, the main focus of these programs is often to reduce the extent poverty among the chronically poor and hence not fully integrated into Sudan’s Disaster Risk Management (DRM) strategy. Thus, there is the need to ensure that these programs efficiently target and effectively uplift vulnerable groups of the population out of poverty- particularly poor households who are vulnerable to various shocks and lack the capacity to mitigate their impact when they occur. For these households, access to social protection can minimize long-term effects of using extreme coping strategies. However, data shows that majority of Sudanese households (particularly the poorest) rely on costly coping strategies such as using savings and/or selling assets (World Bank 2014, 24 and 113). Furthermore, a recent report on the state of social protection in Sudan documents the uneven coverage of existing programs and provides recommendations to expand coverage, improve targeting, and evaluate their effectiveness (Kjellgren et al. 2014). Thus, reforming SSN programs to increase access and coverage as well as restoration of macroeconomic stability is needed to strengthen the resilience and reduce poverty among these households.

Box 1: Sudan’s Safety Nets and Social Protection Programs

**At the time of the NHBPS 2014/15, existing government and parastatal transfers covered only a small fraction of the poor** . Food aid recipients were heavily concentrated in North Darfur, benefiting from well-targeted transfers from humanitarian actors. Government transfers and transfers expended by Zakat, a parastatal religious organization, on the other hand, covered only a small fraction of the poor and lacked accuracy in targeting. However, the receipt of transfers, especially the amounts household received, is likely underestimated.

**While food aid programs were reasonably targeted to the poor, government transfers, NGO/charity transfers, and Zakat transfers had comparatively low targeting accuracy** **_._** The bottom 40 percent accounted for around 60 percent of the recipients of food aid (World Bank 2018). This compares to a share in consumption expenditure among this group of around 20 percent. Hence, food aid in Sudan is progressive and pro-poor. While pro-poor and other types of transfers lack targeting accuracy, the bottom 40 account only accounted for 39.4 percent, 45.5

> 2 <u>https://www.worldbank.org/en/data/datatopics/aspire</u>

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