IMPACT OF COVID 19 ON THE ECONOMY
The COVID-19 (coronavirus) pandemic has had an unprecedented social and economic effect on Sudan, as it has on the rest of the world. The COVID-19 shock is supposed to be temporary, but Sudan’s total economic effects will be significant. COVID-19’s economic effect involves higher food prices, raised unemployment, and decreased exports. The economic situation is deteriorating because of travel restrictions, with commodity prices surging across the world.
The global pandemic has also harmed livestock exports and remittances from the Sudanese emigrants, thus lowering the cost of fuel subsidies in foreign currency. South Sudanese crude export proceeds and transit fees will be greatly reduced because of lower oil prices. Because of the COVID-19 pandemic, the IMF predicts a further 7.2 percent GDP contraction in 2020. Trade fell by 15.2 percent and inflation rose to 81 percent which indicates the vulnerability of the people to poverty.
RESPONSE TO COVID-19 CRISIS
Sudan’s attempts to control COVID-19 follow a Whole-of-State strategy. The Defence Council and State Security decided to put in place strict defensive measures. Similarly, multi-stakeholder responses have been organized by a variety of government and non-government mechanisms.
Government, CSOs (Civil Society Organizations), including revolutionary commissions, the private sector, and UN institutions have all worked together to mitigate systemic impacts. They have come together to promote the delivery of necessities and health supplies, as well as behaviour modification.
ECONOMIC STIMULUS PACKAGE
- The private sector in the country has offered to fund the government with $ 2 million, the government has redistributed $3 million, and the UN and foreign donors are projected to donate $9 million.
- The US government has also offered an $8 million donation, while the European Union has offered a EUR 70 million aid package.
- The Islamic Development Bank reportedly provided $35 million to Sudan in April 2020, while the World Bank revealed a US$ 35 million package from its trust funds.
- To lessen the detrimental effect on households and businesses, the government expanded the social safety net by increasing direct cash transfers, offering unemployment care, and distributing low-cost basic food baskets to low-income families. In three months, these interventions could cost $1.5 billion.
- According to the Ministry of Health, 30 billion SDG has been set aside to avert the deterioration of the Sudanese health sector, with another 20 billion SDG set aside to assist families impacted by the Khartoum lockdown.
- In 2021, The government launched an $8 Million stimulus package. Out of this, $5 Million went to the Ministry of Health’s pandemic response.
- In 2021, The government has also diverted a USD7.6 million World Bank grant to UNICEF and the ICRC (International Committee of the Red Cross), the grant’s third-party implementers. COVID-19 prevention and recovery supplies were purchased with the money.
EMPLOYEMENT RELATED RESPONSES
- In April 2020, the government reported a substantial rise in public sector job wages.
- Ministries of Social Development, Trade, Finance, and industry in assisting the deprived and needy families, as well as reducing the economic risks associated with the state of complete suspension, which is entailed by health problems and infrastructure weaknesses in the health sector.
- The Council of Ministers decided to grant extra powers to state health ministers to address the coronavirus pandemic, signalling that the conference also highlighted the role of technical committees that function from the Ministry of Health as the body in charge of technical aspects of the coronavirus battle.
REBUILDING THE ECONOMY
UNDP Sudan has worked with women’s organizations and civil society organizations to manufacture soap and personal protective equipment (PPE) to help the economy, rebound, and it plans to step up these activities. Domestic PPE development, which focuses on small and micro-enterprises, as well as youth and women, is promising for work retention and creation, as well as vital health supply chain security and support for the potential safe return of other sectors, such as agriculture.
The UNDP is working to increase agricultural growth by creating jobs, increasing wheat production to minimize reliance on imports, and investing in facilities such as solar water pumps, canals, and wind turbines. Employment development, national food self-sufficiency, decreased dependence on fossil fuels and expanded yet sustainable exports would all benefit from harnessing Sudan’s ecological potential.
Supporting Sudan’s most insecure, UNDP is ready to work with the government and private sector to recognize and solve issues affecting micro and small businesses, which have been disproportionately impacted by the pandemic.
- “Overview.” World Bank, www.worldbank.org/en/country/sudan/overview#3.
- “Policy Responses to COVID19.” IMF, www.imf.org/en/Topics/imf-and-covid19/Policy-Responses-to-COVID-19#S.
- “Sudan.” KPMG, KPMG, 13 Apr. 2020, home.kpmg/xx/en/home/insights/2020/04/sudan-government-and-institution-measures-in-response-to-covid.html.
- UN, 2020, COVID-19 SOCIO-ECONOMIC IMPACT ASSESSMENT FOR SUDAN.
- “World Bank Group Provides Support to Help Sudan Manage the Health and Economic Impacts of the COVID-19.” World Bank, www.worldbank.org/en/news/press-release/2020/09/30/world-bank-group-provides-support-to-help-sudan-manage-the-health-and-economic-impacts-of-the-covid-19.