Our comprehensive assessment of Sudan's operating environment and the outlook for its leading sectors are formed by bringing together a wealth of data on global markets that affect Sudan, as well as the latest industry developments that could impact Sudan's industries. This unique integrated approach has given us an impeccable track-record for predicting important shifts in the markets, ensuring you’re aware of the latest market opportunities and risks in Sudan before your competitors.
Sudan Country Risk
A more supportive inflationary environment and prudent fiscal and monetary policy will keep economic growth in Sudan stable and moderately paced over the coming quarters.
Facing rising political and economic pressures, Sudan's ruling National Congress Party will continue to engage in National Dialogue with its domestic foes and international mediators. That said, we expect talks to yield little, with an end to crippling economic sanctions or meaningful international debt relief both highly unlikely over the next 12 months.
In South Sudan, there growing evidence that the protracted nature of the civil conflict - which began in December 2013 - is leading to a hollowing out of state capacity and civil society and a breakdown of the formal economy.
Our negative outlook for the South...
Sudan Operational Risk Coverage (9)
Sudan Operational Risk
Sudan Operational Risk
BMI View: Sudan's operating environment is extremely unappealing for investors, with business activities threatened by security issues, an uncompetitive labour market and high levels of corruption. Foreign companies are often a target for rebel militias and terrorists, while Sudanese forces have limited capacity to protect international interests. Restricted access to education has resulted in a poorly skilled labour pool and high labour taxes put upward pressure on costs. While businesses benefit from inexpensive utility costs, water scarcity and an increasing reliance on oil imports threaten supply. In addition, international trade is hampered by long lead times and high costs of shipping. Sudan consequently receives a low score of 27.7 out of 100 in the...
Sudan Crime & Security
Sudan Crime & Security
BMI View: The risk of crime, terrorist attacks, and interstate warfare is acute in Sudan. Foreign workers and companies are a target for organised crime, anti-government insurgents, and international terrorists. Moreover, the complexity of the Sudanese security environment makes conflict resolution very difficult.
Sudan exhibits some of the highest risks for crime, terrorism, and interstate security, of any country in the world. With such pervasive security threats from domestic and international actors, the country performs badly for Crime and Security risk, scoring 8.2 out of 100. This makes it the fifth-most at risk country in the world.
The risk of interstate conflict involving Sudan is very high. While Khartoum has established good...
Sudan Labour Market
Sudan Labour Market
BMI View: The Sudanese labour market presents significant operational challenges to companies and poses significant risk to investors, including a poorly skilled workforce, rising minimum wage, low flexibility in the labour market, tight immigration controls, and uncompetitive tax on labour. A core weakness in Sudan's labour market is the education sector, which presents a threat to labour supply. This has a knock- on effect for the availability of labour, which is characterised by a low participation rate and poor competency levels. Sudan scores 26.1 out of 100 and ranks last out of the 48 Sub-Saharan African countries included in the BMI ...
The major downside logistics risks in Sudan are poor land transport and heavy trade bureaucracy, which raise shipping lead times and elevate costs for companies. On the upside, Sudan has sufficient electricity supply at affordable tariffs, and high volumes of international trade which increase the overall size of the market.
Trade Procedures and Governance present the greatest challenges to investors out of the three pillars of the BMI Logistics Risk Index. The Extent of Transport risk is marginally lower, and is set to decrease if rail development succeeds. Meanwhile, Market Size and Utilities risk is the strongest facet of Sudan's logistics risk. The country ranks 13th out of 44 states in Sub-Saharan Africa (SSA) in BMI's Logistics Risk Index, with a score of 39.3 out of 100.
By regional standards, Sudan has low trade bureaucracy requiring fewer documents than regional...
Sudan Trade & Investment
Sudan Trade & Investment
Trade and Investment risk is Sudan is very high. The country remains under economic sanctions, the financial markets are under developed, and the legal risks to investors are acute. Meanwhile, competition in the open market is stifled by state-owned enterprises and politically aligned private businesses. These factors severely limit international trade, and are only partially mitigated by improvements to the tax regime and licensing procedures under the Investment Encouragement Act.
Sudan scores 24.6 out of 100 for Trade and Investment, ranking 158 th out of 170 countries globally, one place below Libya. Legal reforms have reduced the risk of Government Intervention. However, a mêlée of internal and external factors limit Economic Openness. With regards to Legal Risk, Sudan is among the world's highest risk nations.
Legal Risk is the primary deterrent to international investment in Sudan. First, the country...
Sudan Industry Coverage (8)
BMI View: We forecast growth of 5% in new passenger vehicle sales in 2016 as they recover from low base effects, however, growth in sales will remain well below their 2009 peak level of 12,298 reaching 4,474 units in 2020.
|New Vehicle Sales Remaining Muted|
|Passenger Vehicle Sales|
|e/f = BMI estimate/forecast. Source: Renault Group, BMI|
Defence & Security
Sudan Defence & Security
BMI View: Sudan boasts one of the region's largest defence sectors but still imports a significant volume of military equipment and services from Russia, China and Iran. Over the longer term, as the country's defence sector improves and it becomes more self sufficient, we expect there to be an increasing volume of defence exports, largely to the wider African region. A key driver behind the expansion of its military capabilities will remain the deteriorating situation in South Sudan and the ongoing violence between warring factions, opposition groups and government authorities. However, even though the country is looking for new export partners, we...
Food & Drink
Sudan Food & Drink
BMI View: We maintain our view that economic growth in Sudan will pick up modestly over the coming quarters, with real GDP set to expand by 3.7% in 2015 and 4.3% in 2016 (from an estimated 3.0% in 2014). This improvement is in large part due to easing inflationary pressures as the high base effects associated with a painful currency devaluation in September 2013 wear off. Our forecast for a significant rise in per capita food consumption in 2015 is a result of very low current consumption and high inflation. However, the demographic profile of the countries, with their significant young population, will...
BMI View : Over our 10-year forecast period up to 2024 Sudan and South Sudan will experience subdued growth in their respective construction industries, owing to political and economic instability hampering their ability to attract the necessary foreign investment. Lower oil prices are also dampening growth prospects for the two nations, as both are heavily reliant on this commodity to support government spending.
Latest Updates And Structural Trends
South Sudan and Sudan will experience subdued growth over our 10-year forecast period as political unrest remains a barrier to attracting significant foreign direct investment to address both nations' infrastructure deficits.
In Sudan, political risks and fears of a loss of control outside the capital...
Oil & Gas
Sudan Oil & Gas
BMI View: A weak security environment and stuttering peace process will continue to depress crude production in South Sudan in 2016. In the longer term, the upside risks are substantial; however, chronic underinvestment, extensive damage to infrastructure and persistent instability will dampen any prospective recovery in output. The outlook on Sudan is also relatively bearish, due to the weak investment climate, uncertain political outlook and pervasive security threats. The downstream in both countries will remain poor, due to limited domestic capacity, dwindling domestic resources and a lack of appetite for wider foreign participation.
Pharmaceuticals & Healthcare
Sudan Pharmaceuticals & Healthcare
BMI View: Sudan is attempting to reduce its reliance on imported pharmaceuticals with government support. Despite an investment from an Egyptian drugmaker this quarter, the country will not achieve this goal in the near future given the current political environment.
Headline Expenditure Projections
Pharmaceuticals: SDG2.68bn (USD451mn) in 2014 to SDG3.00bn (USD491mn) in 2015; +12.1% in local currency terms and +8.7% in US dollar terms. Forecast revised slightly upwards from Q415.
Healthcare: SDG24.03bn (USD4.05bn) in 2014 to SDG27.05bn (USD4.42bn) in 2015; +12.6% in local currency terms and +9.1% in US dollar terms. ...
BMI View: Sudanese hydropower will remain the dominant source of electricity up until 2024, with an average of 75% of generation coming from hydroelectric sources, increasing overall electricity generation to 23.9TWh in 2024.This will enable
BMI View: The Q1 2016 East Africa report analyses the latest industry, regulatory and macroeconomic developments within the telecommunications markets in Burundi, Ethiopia, Malawi, Rwanda, South Sudan and Sudan. These six markets are characterised by several challenging business dynamics, including low consumer spending power, high infrastructure costs, large rural populations with poor access and, some cases, politically volatile environments. Limited competition in several of these markets, along with unfavourable fiscal regimes, creates considerable downside risks to market growth. 3G and 4G subscriber penetration rates, as well as their share of total mobile subscriber bases, are expected to remain among the lowest in the world for the foreseeable future.
|3G And 4G Subscribers to Increase Share of Total Mobile Market|
|East Africa Mobile Market Forecasts|