Spiraling inflation in Northern Sudan

Northern Sudan is experiencing a rapid inflation of prices for basic goods. In fact, the beginnings of the inflation can be traced back to when the northern government signed the cease fire with the south. With the Sudanese Pound not as valuable as before, people are already feeling the economic impact of the south's succession and the vast oil reserves they take with them

From the Inter Press Service, writer Reem Abbas has this account of people feeling the economic pinch.

At the time, one Sudanese pound was equal to 2.30 dollars and life was considerably cheaper. The Sudanese economy was booming due to high oil prices and increasing foreign investment.

In the years following the signing of the Comprehensive Peace Agreement in 2005, new jobs were created, cafes were bustling with customers and young professionals were able to buy cars in instalments and travel to Cairo or Dubai or Kuala Lumpur for holidays.

"No one is traveling now, people are trying to save their money for worse days. Tickets were much cheaper a few months ago, but now the prices are up 25 percent," said Maha Ali*, an employee at a travel agency in downtown Khartoum.

Ali used to make a lot of money from commissions when she brought customers to the agency. Now it is a struggle to convince people to travel, especially when some airlines only accept dollars and reject the constantly fluctuating Sudanese pound.

The economy changed in November 2010. The North Sudan government claimed that Sudan lacked foreign currency and the Sudanese minister of finance and national economy, Mahmoud Hassanein, was quoted saying that the country’s people consumed more than the country produced and this caused the rise in prices.

In early January 2011, southern Sudanese voted in a referendum in favour of secession from the north and this set in motion the beginnings of an economic crisis in Sudan. Currently North and South Sudan equally share the profits of the oil found in the south. But this will change when South Sudan becomes independent.

But North Sudan began to feel the impact of the secession even before the referendum. Prices skyrocketed as a result of inflation and salaries remained the same or even decreased.