January 2, 2018 / 3:30 PM / 18 days ago

Sudan's pound drops against dollar on black market, say traders

KHARTOUM, Jan 2 (Reuters) - The Sudanese pound’s black market value dropped on Jan. 1, the same day as the country devalued the currency, trading at 28.7 SDG per U.S. dollar compared to 27 the day before, traders said.

Sudan devalued the pound to an official rate of 18 SDG per dollar from 6.7 SDG per dollar, effective from Jan. 1, after the International Monetary Fund urged it in December to float its currency to boost foreign investment.

“The (U.S.) dollar exchange rate jumped today to 28.7 against the (Sudanese) pound,” a trader on the black market told Reuters, adding that the dollar was epxected to appreciate further.

“The low exchange rate of the pound and the fluctuation in its price are the real problems that face our economy at the moment,” Finance Minister Mohamed Othman Rukabi told a news conference on Tuesday.

In November the pound had dropped sharply in value after the United States lifted 20 years of economic sanctions, encouraging traders to expand activity, which put pressure on already-scarce foreign currency.

Washington lifted the sanctions and a trade embargo in October, saying Sudan had made progress on counter-terrorism cooperation and in resolving internal conflicts.

Sudan is seeking to increase the supply of foreign currency and decrease demand, central bank governor Hazem Abdul-Kader said.

The import-dependent country has suffered both from the sanctions and from the secession of the south in 2011, when it lost three-quarters of its oil output, its main source of foreign currency. (Reporting by Khalid Abdelaziz; Writing by Dahlia Nehme; Editing by Gareth Jones)

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