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Africa Business News of Monday, 4 May 2020

Source: reuters.com

Sudan sets up bourse for gold as opens up market

Sudan, Africa’s third biggest gold producer, is setting up a bourse for the precious metal and will standardize the price in accordance with the global rate, Sudanese Prime Minister Abdalla Hamdok said in a statement on Monday.

In January, Sudan started allowing private traders to export gold, a measure designed to crack down on smuggling and attract foreign currency into the country’s cash-strapped treasury.

Before the new regulations, the central bank bought gold at a discount to the international price. As a result, an estimated 70-80% of it was smuggled abroad, according to government officials, hurting the treasury’s coffers.

Sudan produced an estimated 93 tons of gold in 2018, which would make it Africa’s third biggest producer after South Africa and Ghana, according to the U.S. Geological Survey.

Sudan is also setting up an investment fund for the private sector donations, the statement added.

The African country’s struggling economy has not revived with the overthrow of long-time autocrat Omar al-Bashir a year ago.

The transitional government has been trying to overcome shortages of imported - and heavily subsidised - fuel and flour. Inflation is running at more than 80%, according to official statistics.

In crisis since losing most of its oil wealth with the secession of the south in 2011, the country has experienced an acute shortage of foreign currency. The dollar rose to almost twice the official rate against the Sudanese pound on the black market this week.

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