Current Date:

Saturday, 18 November 2017

1120 out of 3125 Factories Ceased Operations

The US economic sanctions and lack of funds have forced many factories to stop operations in Sudan

and thus contributed to somewhat economic deterioration rendering thousands of workers jobless.
There is possibility to resuscitate the industrial sector in the country – thanks to the US decision to lift sanctions and efforts by the Ministry of Industry to export modern technologies and resolve by the Ministry of Finance and National Economy and Khartoum Stock Market to supply necessary funds in aid of reviving the industrial sector.
To that end, the Ministry of Industry held a forum in collaboration with the Chambers of Industry and Khartoum Stock Market to look at ways to help factories that had ceased operations to revive and get back to production ways.

Poor investment in productive sectors:

The Ministry of Finance and National Planning Mohamed Osman Al-Rikabi admitted the neglecting of the industrial sector since independence, adding that all potentials that went out of operations constitute a great loss for all of us, asking the owners of the factories to resolve their problems related to funding by looking for multiple sources of financing and not rely on banks.
Al-Rekabi lamented poor investment in productive sectors, adding that investment is remarkably confined to lands and gold in addition to stock markets
He stressed that the need to transform family business to public shareholder companies to avert risks of failure; he noted that the problem of Sudanese people lies in their failure to work collectively. 

Financial, technical and social reasons

The State Minister for Industry Abu Daud Suleiman attributed the reason for companies to be out operation to financial, technical and social problems in addition to two-decade long US economic sanctions on Sudan, which made it difficult for companies to supply spare parts for sustainability. The State Minister Added that the country is not in needed of additional factories but revive the old ones that have stopped.

Conflict between businesses and financial policies

For his part, Moawia Elberier argued that the problems of the industrial sector have to do with conflict between factories and financial policies. In addition to heavy taxes and fees levied on those factories, and smuggling from neighboring countries. He lauded that decision to ban commodities not conforming to quality standards.
Elberier said the call for turning family businesses to public shareholder companies require special incentives and tax exemptions, adding that the concentration of factories and industries in Khartoum impacts efforts to sustainable developments – therefore he called for transferring companies to states.
The contribution of the industrial sector to gross national production does not exceed 21%, admitted Musaad Mohamed Ahmed, the President of Banks Union, adding that the risks of funding industrial sector are less compared to financing other sectors. He noted that the funds should be aimed at improving infrastructures and called on the owners of the companies to conform to the requirements and conditions for funding by banks to ensure obtaining loans and credits.
The Director of Khartoum Stock Market claimed that the Stock market has the capabilities of supplying funds for the industrial sector, capabilities, according to him, the banks are lacking, due to numerous restrictions, he did not name.
According to statistics 1120 companies have ceased to operate in Khartoum in addition to many others in different parts of Sudan. Notably, poor agricultural production has had its toll on cooking oil industries.
Sudanese industry accounted for an estimated 17 percent of GDP in 1998. The small size of the country's industrial sector is a result of chronic problems, including lack of skilled labor force, raw materials, and investments. These problems are most apparent in the textile and foodstuff industries, as well as in the production of sugar. If these problems were resolved, Sudan could dramatically reduce its reliance on imports.