North Sudan to introduce new gold and commodity trading platforms

Ever since Christian South Sudan declared its independence in July 2011, the Islamic government of North Sudan has urgently been looking for new sources of income. With South Sudan’s independence, Khartoum – seat of the northern government – has lost almost two thirds of its crude oil revenues. As a result, the North has been encouraging gold exploration and mining activities, in the hope of using this to compensate for the lost oil revenue. Therefore, the Khartoum stock exchange – currently a rather small market – is planning to significantly expand its activities by offering trading in gold and other commodities.

Following the end of civil war in Sudan in 2005, residents of southern Sudan voted for independence from the north in a referendum in January 2011, leading to formal secession on July 9 last year. The Islamic government in Khartoum has been making all kinds of efforts to compensate for lost oil revenues, which had accounted for 90% of national income. The government of North Sudan is now focusing on the gold sector, which has led to a significant increase in gold production and exploration activity in the country. Anticipating southern secession, the government in Khartoum had already been encouraging national and foreign companies to invest in gold mining. As a result, there are currently more than 125 companies operating in the Sudanese gold sector. In the past two years gold mining revenues have increased twenty-fold. Data from the country’s central bank shows that during Q1 of 2011 North Sudan’s gold exports increased to roughly $247 million – a 45% increase in comparison with the same period from the previous year.

So far, prospecting activities in North Sudan have generally been successful, as they have led to the discovery of huge gold reserves, as well as other minerals and commodities, and the government is hoping that more companies will get involved in mining in the country. This will hopefully lead to an expansion of trading at the Khartoum stock exchange. By introducing trading in gold and other commodities, Khartoum is hoping to increase foreign investment into the country.

AuthorRoman Baudzus

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