Learn about barriers to market entry and local requirements, i.e., things to be aware of when entering the market for this country.
U.S. businesses should be aware that investors could face difficulties in transferring money to Sudan as international financial entities continue to exercise extreme caution in processing transactions. This caution springs from Sudan’s SST designation and possible reputational risk, although the October 2020 decision to rescind the designation is expected to ease Sudan’s isolation from international financial institutions. Those who decide to pursue permissible commercial activity should be advised that U.S. banking institutions are independent entities and neither the U.S. government nor the Embassy can direct their business decisions.
Sudan operates a primarily cash-based economy. The CLTG maintains strict currency controls as inflation remains a major challenge in 2020. It is illegal to export/import Sudanese pounds. Cash transfers or the importation of over $10,000 requires an import declaration.
Sudan presents one of the most challenging business environments in the world for potential investors. The country’s ranking dropped from 162 (2019) to 171 out of 190 countries in the 2020 World Bank-International Financial Corporation’s “Doing Business Report – Ease of Doing Business.” Sudan is ranked 173 of 180 countries on Transparency International’s 2019 Corruptions Perception Index, tied with Afghanistan and Venezuela. Sudan is ranked 168 out of 188 countries in the 2019 UN Human Development Index (HDI), just ahead of Haiti and Afghanistan. An estimated 47 percent of Sudan’s population live below the national poverty line, according to the HDI.
Political risk remains a concern. Sustained popular protests over several months put an end to the 30-year rule of Omar Bashir in April 2019. The CLTG assumed power in September 2019 and has 39 months to implement the priorities set out in the constitutional declaration (signed August 17, 2019), including formation of a Transitional Legislative Council, appointment of civilian state governors, and holding new elections. However, the military remains a strong force in the transitional government, chairing the Sovereign Council and maintaining decision making power over defense and security institutions. The CLTG negotiated with armed groups in Darfur and in the “Two Areas” of South Kordofan and Blue Nile States and with non-armed groups in northern, eastern, and central Sudan to reach a peace agreement signed on October 6, 2020. Sudan and South Sudan have yet to demarcate their common border, but have agreed to resume talks over the sovereignty of the oil-rich territory of Abyei. Armed UN peacekeeping missions (UNAMID and UNISFA) are in Darfur and Abyei, respectively.
Decades of autocratic rule has resulted in government monopolies as state-owned enterprises (SOEs) in various sectors of the economy. Past leaders also granted key supporters exclusive licenses and government contracts. The CLTG has publicly announced it will work to eliminate these monopolies and begin the privatization process.