The Political Economy of the Transition in Sudan: Hamdok Lost Opportunity for Reform

Optimism was high in the air of Khartoum when Dr. Abdallah Hamdok took the oath as prime minister of Sudan back in August 2019. However, this is no longer the case in the capital of Sudan which has faced regular oil and food shortages for months. The deteriorated economic situation that contributed to the fall of Bashir’s regime is getting worse. Unless there are serious reforms, the economic failure will haunt the current government transition as well.

An expert in economic development, Dr. Hamdok was best suited to provide Sudan with economic measures that were critically needed to stop the economic decline. The first step that Hamdok took was the appointment of World Bank Economist Dr. Ibrahim El-Badawi as his Finance Minister.

The move vexed leftist opponents in the Forces of Freedom and Change (FFC), a civilian coalition that led the protest against the former regime. El-Badawi’s plan was clear from the earlier days of the revolution when he outlined his vision for reforming Sudan’s economy by cutting universal subsidies immediately to revive Sudan’s economy.  He faced strong opposition from the Sudanese Communist Party and the Baathist Party when he was appointed Finance Minister last September.El-Badawi’s opponents made their disapproval very clear when they rejected the government’s 2020 budget proposal that was approved by the cabinet on December 27, 2019. The FFC’s economic committee pressured El-Badawi to propose a three-month temporary budget instead, and the government called for an economic conference to bypass the political deadlock in six months.

The government was depending on the Friends of Sudan to provide loans and grants to finance the country’s obligations.

Unfortunately, the coronavirus pandemic brought these plans to a halt, and the government has no year-long budget to this day. Furthermore, the government was also depending on the Friends of Sudan, a group of western and regional countries committed to help Sudan’s transition, to provide loans and grants to finance the country’s obligations. However, the donor’s conference that was scheduled for next June seems very unlikely to take place, given the global disruption of the pandemic.

On March 6, Hamdok announced the formation of a new Higher Economic Mechanism Committee headed by him to address the country’s declining conditions. The committee consisted of Sovereign Council members, cabinet ministers, and FFC representatives. The controversial Mohamed Hamdan Hemedti –Vice President of the Sovereign Council and leader of the Rapid Support Forces – was named a member of the committee, which brought some criticisms from the FFC. A couple of days later, Hemedti resigned from the committee. But, the standoff between the FCC’s economic committee and El-Badawi continued to halt any progress.

On March 31^st, El-Badawi launched a media campaign to raise awareness on the disadvantages of commodity subsidies and the government’s plans to address these distortions. Yet again, Hemedti took an oath as head of the economic committee, and Hamdok became the vice head of the committee a month later. This latest action highlighted Hamdock’s attempt at growing the input and influence of military institutions in the transitional period.

The New York Times recently reported that the civilian government reached out to Hemedti to prevent an imminent Islamist coup. These speculations come amid waning popular support for the FFC because of its failure to improve the country’s economic deterioration and end regional wars by achieving a comprehensive peace agreement.

Hamdok launched Stand For Sudan, a crowd-funding campaign aiming to restore public support of his government.

As a result, Hamdok launched Stand For Sudan, a crowd-funding campaign aiming to restore public support of his government. Yet it was not clear how the government was planning to use these funds until it announced three primary objectives three days later: the first one is to improve electricity supply, the second to provide lifesaving medicines, and the last to prepare Sudanese infrastructure for rainy seasons.

Adding to the political and economic issues and their complexity, the government shut down Khartoum International Airport on March 16 and ordered a total lockdown to fight the spread of COVID-19. The number of cases is increasing rapidly, reaching a total of 275 confirmed cases on April 27 and 22 deaths. However, people are defying the government’s orders to stay at home to get food and gas. Most Sudanese people can’t afford to stay home for 21 days as they depend on daily jobs.

Like many African countries, the imposition of social distancing might have a graver consequence on Sudan’s poor communities, given the institutional weaknesses of healthcare and lack of direct financial aid. Many suburban areas in Sudan don’t have regular water supply and suffer from hygiene diseases such as Cholera. The measures that Khartoum’s government has taken will add to the growing dissatisfaction of people who are in a perpetual struggle to secure food and fuel.

The problem of Sudan’s economy has always been in the macroeconomics, meaning it is more of a structural problem.

The problem of Sudan’s economy has always been in the macroeconomics, which means it is more of a structural problem, and the left-right rift only deepens these fundamental problems. As Dr. Khalid El-Tigani, an economist and Editor-in-Chief of Elaf economic newspaper, put it: “The problems of Sudan’s economy did not start today, but had [their] roots back in the history of Sudan for ages.”

It’s no secret that Sudan’s transitional period is burdened by long-standing economic decay; however, there are some opportunities that Sudan should never miss. Sudan’s vast agricultural potentials are yet to be utilized, and the coronavirus pandemic has caused market supply disruption throughout the world. A few days ago, 40 tons of Sudanese onions were sold out in Kuwait because of increasing demand worldwide.

Nevertheless, capturing these opportunities would require politicians to put their ideological preferences aside and think pragmatically about reviving the economy. It’s disappointing that the government of the revolution can’t agree on a fiscal budget, given all the hopes that the Sudanese people have put on it. Hamdok’s government needs to produce a comprehensive consensual vision to rebuild Sudan’s economy before it’s too late to reform.