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Sudan's high inflation eases slightly to 20.7 per cent in Sept

Prices for basic foods continue to rise despite overall easing, potentially stoking dissent among a population hit by unemployment and currency problems

Reuters, Tuesday 11 Oct 2011
Sudan market
A Sudanese man sells his fresh catch from the river Nile at the traditional fish market in the Sudanese city of Omdurman (Photo: Reuters)

Annual inflation in Sudan eased slightly to 20.7 per cent in September from 21.1 per cent in August but remained very high as prices of fish, cooking oil and other basic food items rose, adding pressure on ordinary Sudanese hit by an economic crisis.

Analysts say food inflation could stoke dissent among people already hit hard by unemployment, a devalued local currency, a lack of foreign currency and U.S. trade sanctions.

Month-on-month inflation decelerated sharply to 0.4 per cent in September, the Central Bureau of Statistics said in a statement on Tuesday, from 3.7 per cent in August.

Inflation typically drops at this time of year after the Muslim fasting month of Ramadan, when demand for food products surges. Ramadan fell in August this year.

Food prices, which make up more than half the consumer price index, fell 1.8 per cent in September compared with August, but were 21.7 per cent higher than in September last year.

Prices of meat fell 1.4 per cent in September compared to August after a consumer protection society called a boycott on buying meat for several days to bring down prices.

But prices of fish, much of which comes straight from the Nile, jumped 5.1 per cent in September compared to August and prices of cooking oil rose 4.1 per cent from August.

Inflation has more than doubled since the government effectively devalued the Sudanese pound in November to curb black market activity.

Sudan lost 75 per cent of the country's 500,000 barrels a day of oil production when the South seceded in July after an independence vote agreed under a 2005 peace deal.

The two sides used to share oil revenues -- the lifeline for both economies. The south will have to pay usage fees for northern oil export facilities but what the north earns is likely to fall short of the 50 per cent it received previously, analysts say.

Adding to economic woes, violence in the region bordering South Sudan is affecting the economy.

Inflation in the South Kordofan state, where the army is fighting armed groups, was 32.8 per cent in September, although lower than 35.6 per cent in August. In the neighbouring Blue Nile state inflation was 34.1 per cent in September, shooting up from 26.4 percent in August.

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