North Sudan will not abandon the Pound after secession, Central Bank
North Sudan has no plans to supplant the current pound with a new currency after the south’s secession is official in July this year, the country’s Central Bank officials stated yesterday.
The announcement, which was reported on Thursday by the subtly pro-government daily Al-Ra’y al-Amm, quelled earlier suggestions by south Sudanese officials that the north was planning to abandon the national currency in an effort to preempt the south’s plan to introduce own currency.
The issue of currency is among a backlog of post-referendum arrangements being discussed between north and south Sudan as the latter hurtles towards becoming a fully independent state after it voted almost unanimously for secession from the north in a referendum last month.
Other issues include the status of the hotly contested border area of Abyei, border demarcation, national debt, citizenship, oil sharing, water and international agreements.
The referendum was granted under the 2005’s Comprehensive Peace Agreement (CPA), which ended more than two decades of civil war and shared wealth and power between the north and the south.
Elijah Malok, the deputy governor of the soon-to-be Central Bank of Southern Sudan, told reporters on Monday that the south was negotiating with the north on how to phase out the pound because the north decided to “have nothing to do with the pound.”
“As soon as the whistle is blown for the independence of southern Sudan, they [the north] will forget the pound, and therefore the negotiations are going on how you redeem it or how you bring it back to the coffers of the Bank of Southern Sudan," Malok added.
Under the CPA, North Sudan agreed to re-adopt the pound which was the official currency after British colonial rule until the current Islamist government of president Al-Bashir dropped it and adopted the Dinar in an attempt to appeal to the sentiments of Arab identity.
"The pound in fact was imposed on them. They ([he north] had the dinar and I am sure they are still keeping it in their coffers," Malok said.
However, the governor of Sudan’s Central Bank Sabir Mohamed Al-Hassan on Thursday affirmed that efforts were underway to maintain the pound as the official currency in the north, according to Al-Ra’y al-Amm report.
Analysts told Reuters that the north did threaten to make the potentially disruptive move of introducing its own currency during negotiations, but said it was just a tactic to win concessions from the south ahead of secession.
Al-Hassan said in an interview last week that the North would work on retrieving any quantity of Sudanese pound circulating in the South once the latter introduces its own currency.
South Sudanese officials earlier said that the region plans to introduce its own currency once its transformation into an independent state is official on 9 July.
Analysts estimate the reintroduction of the pound in 2007 cost Sudan around $150 million, an expense the north could not afford given its current economic crisis.
Sudan is grappling with a bout of economic malaises manifested in shortage of foreign currency, a slump in the value of the Sudanese pound and soaring inflation rates.
These troubles prompted the country to devaluate its currency to counterbalance loss to the dollar and floated an austerity package involving cuts in subsidies on sugar and petroleum products.
Sudan also curbed imports of many goods, imposed restrictions on hard cash transfers abroad and cut pays of government officials.
A privatization process is also underway to get rid of state-owned firms to reduce expenditure.
Sudan blames the current conditions on speculations related to the impact of south Sudan secession as well as global increases in food prices.
North and South Sudan are negotiating a new deal to share oil revenues to replace the old deal of 50-50 split under the Comprehensive Peace Agreement.
Most of Sudan’s proven daily output of 500,000 oil barrel is extracted from oilfields in the south whereas the pipelines infrastructure and refineries are based in the north. Both sides need to maintain cooperation on oil after secession to sustain their economies which depend greatly on oil revenues.
North Sudan has no plans to supplant the current pound with a new currency after the south’s secession is official in July this year, the country’s Central Bank officials stated yesterday.
The announcement, which was reported on Thursday by the subtly pro-government daily Al-Ra’y al-Amm, quelled earlier suggestions by south Sudanese officials that the north was planning to abandon the national currency in an effort to preempt the south’s plan to introduce own currency.
The issue of currency is among a backlog of post-referendum arrangements being discussed between north and south Sudan as the latter hurtles towards becoming a fully independent state after it voted almost unanimously for secession from the north in a referendum last month.
Other issues include the status of the hotly contested border area of Abyei, border demarcation, national debt, citizenship, oil sharing, water and international agreements.
The referendum was granted under the 2005’s Comprehensive Peace Agreement (CPA), which ended more than two decades of civil war and shared wealth and power between the north and the south.
Elijah Malok, the deputy governor of the soon-to-be Central Bank of Southern Sudan, told reporters on Monday that the south was negotiating with the north on how to phase out the pound because the north decided to “have nothing to do with the pound.”
“As soon as the whistle is blown for the independence of southern Sudan, they [the north] will forget the pound, and therefore the negotiations are going on how you redeem it or how you bring it back to the coffers of the Bank of Southern Sudan," Malok added.
Under the CPA, North Sudan agreed to re-adopt the pound which was the official currency after British colonial rule until the current Islamist government of president Al-Bashir dropped it and adopted the Dinar in an attempt to appeal to the sentiments of Arab identity.
"The pound in fact was imposed on them. They ([he north] had the dinar and I am sure they are still keeping it in their coffers," Malok said.
However, the governor of Sudan’s Central Bank Sabir Mohamed Al-Hassan on Thursday affirmed that efforts were underway to maintain the pound as the official currency in the north, according to Al-Ra’y al-Amm report.
Analysts told Reuters that the north did threaten to make the potentially disruptive move of introducing its own currency during negotiations, but said it was just a tactic to win concessions from the south ahead of secession.
Al-Hassan said in an interview last week that the North would work on retrieving any quantity of Sudanese pound circulating in the South once the latter introduces its own currency.
South Sudanese officials earlier said that the region plans to introduce its own currency once its transformation into an independent state is official on 9 July.
Analysts estimate the reintroduction of the pound in 2007 cost Sudan around $150 million, an expense the north could not afford given its current economic crisis.
Sudan is grappling with a bout of economic malaises manifested in shortage of foreign currency, a slump in the value of the Sudanese pound and soaring inflation rates.
These troubles prompted the country to devaluate its currency to counterbalance loss to the dollar and floated an austerity package involving cuts in subsidies on sugar and petroleum products.
Sudan also curbed imports of many goods, imposed restrictions on hard cash transfers abroad and cut pays of government officials.
A privatization process is also underway to get rid of state-owned firms to reduce expenditure.
Sudan blames the current conditions on speculations related to the impact of south Sudan secession as well as global increases in food prices.
North and South Sudan are negotiating a new deal to share oil revenues to replace the old deal of 50-50 split under the Comprehensive Peace Agreement.
Most of Sudan’s proven daily output of 500,000 oil barrel is extracted from oilfields in the south whereas the pipelines infrastructure and refineries are based in the north. Both sides need to maintain cooperation on oil after secession to sustain their economies which depend greatly on oil revenues.
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