Sudan’s Central Bank to Exit from Gold Trade

SEATTLE (Scrap Monster): The Central Bank of Sudan plans to exit from gold trade. This was announced last week by Ibrahim Elbadawi, the country’s Finance Minister. The Ministry has been facing severe criticism for printing cash in return for gold purchases by the bank from artisanal miners, a move which is believed to have led to notable rise in inflation rates in the country. It must be noted that the inflation rate in Sudan had surged to touch 60.67% in November 2019.

According to the Minister, withdrawal of the bank from gold purchases would bring down the exchange rates of the Sudanese pound against the dollar. Also, the exit, coupled with proposed launch of gold exchange market in Khartoum will reduce gold smuggling activities in the country.

ALSO READ: Sudan Permits Gold Expors by Local Private Sector Firms

However, economists sought more clarity on the exit plan by the Central Bank. Also, they urged the Ministry to make it clear whether commercial banks in the country will be allowed to enter into gold purchases.

As per government estimate, Sudan produces nearly 120-200 tons of gold every year. The total yearly revenue from gold is estimated at around $5 million. The gold mining sector in the country employs around 5 million people. Nearly 85% of the gold produced in the country comes from informal miners. Also, gold exports accounts for nearly 37% of the country’s total exports.