Sudan War Triggers A Regional Economic Disaster

AS the prices of basic commodities escalate beyond the reach of impoverished communities in Sudan and neighbouring countries, the weeks-long political conflict has degenerated into an economic crisis. Most of the countries receiving refugees and returnees fleeing the conflict in Sudan are among the most brittle in the world across multiple indices and are reeling from widespread shocks experienced over
2022 and spilled into the current year.

The countries include conflict-prone Chad, Central African Republic (CAR), Ethiopia and South Sudan. Ethiopia is enduring devastating floods and a record-breaking drought. These disasters were already devastating these countries’ economies and the crisis in Sudan has exacerbated them.

In Sudan, where the conflict erupted on April 15, although markets are generally open, prices have increased dramatically for staple goods and there are shortages of imported goods such as wheat, flour, oil and tomato paste. Mercy Corps, the humanitarian aid organisation corroborated this in nine
locations across Sudan.

In some areas, shops have closed because of insecurity or lack of goods. The United Nations Office for the Coordination (OCHA) said access to cash remains a significant issue in Khartoum and South Darfur, while the increase in fuel prices and transportation costs have hindered both daily life and the ability of people to move out of insecure areas.

The escalating Sudan political conflict has degenerated into an economic crisis for the region.

In the capital, Khartoum, a factory that was producing vital supplies for the treatment of malnourished children in Sudan has been burnt during the fighting. In the CAR, as a result of insecurity along the border area with Sudan, traffic has been severely disrupted, causing a sharp increase in the price of basic commodities.

Sudan supplies several towns in northeastern CAR, particularly Birao in the Vakaga Prefecture and Ndélé in Bamingui-Bangoran depend on Sudan for some supplies.

“For some items, prices have doubled,” lamented a humanitarian spokesperson. For example, a 50-kg bag of sugar, which sold for XAF40 000 (US$66) before the conflict, now costs XAF 80 000 in Birao. A small bowl of millet that used to cost XAF500 is now worth XAF1 000. XAF is the CAR Franc.

The Famine Early Warning Systems Network (FEWS NET) forecast higher fuel prices to lead to an atypical increase in food prices through the lean season while purchasing power will likely deteriorate, further limiting access to food and non-food items among households depending on markets.

This might also negatively affect households’ ability to cover health expenses.

OCHA noted with markets in this area being typically supplied by Sudan during the rainy season, prices will likely increase substantially beyond typical levels, which is already showing with prices of some
staples, including sugar and millet, having doubled.

“Key items might become unavailable altogether, depending on disruptions higher up the supply chain,” the OCHA spokesperson stated.

There were indications of a worse-than-usual lean season scenario in Chad, with cereal supply having been negatively affected by high transportation costs, low production levels during the 2022-2023 rainy
season due to unprecedented floods destroying livelihoods.

That was prior to the war in Sudan. The Reach Initiative forecast increasing prices and limited income from labour will further increase market dependency among poor and displaced households at a time of limited purchasing power, in turn driving more people to adopt negative coping strategies and de-prioritise spending on non-food items and services.

The World Food Programme (WFP) stated with many markets already being at reduced functionality, market access was expected to deteriorate further during the upcoming rainy season.

Seasonal flooding towards the end of 2023 is expected to also further disrupt access to critical services while increasing risks of water and vector-borne diseases spreading. As South Sudan enters the lean season, increasing dependency on markets amid high and volatile prices might further reduce households’ ability to spend money on essential items and services.

Considering that Sudan is a main exporter of sorghum to markets in northern counties of South Sudan, seasonal price increases could be stronger than usual due to border restrictions or other supply
disruptions within Sudan, according to humanitarian groups.

At least 676 people have been killed nationwide, and more than 5 500 injured after clashes between the Sudanese Armed Forces (SAF) and the Rapid Support Forces (RSF) erupted in Khartoum.

More than 200 000 people have fled Sudan to neighboring countries. Over 700 000 have been displaced inside Sudan. Numbers are expected to increase as the violence continues.

– CAJ News



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