Building an environment for reform: laying the foundations for recovery
The scale of change envisaged over the coming years, and the intensity of current socio-economic pressures, mean that many essential reforms will be highly politically sensitive in Sudan. In order for economic reforms to be meaningful, while at the same time establishing public confidence, they must occur in parallel with sustained political transformation and the forging of a new social contract, built on a comprehensive and just peace. This will also necessitate governance reforms that prioritize broader political participation, respect for human rights, increased public accountability and transparency, and strengthened anti-corruption efforts.
Alongside these reforms must come a restructuring of Sudan’s security sector, which currently includes some of the most influential figures in the country’s political decision-making process. The correct sequencing of reforms will be essential. Many laws will need to be amended to remove restrictions on freedoms, but legislative reform alone is not sufficient. Real change depends on having the political will to implement laws and respect the constitution.
Under the Bashir regime, lines between the legislature, executive and judiciary became increasingly blurred, and were further compromised by the ‘shadow’ role of the security services in many sectors. The judicial institutions’ domination by the security services, for instance, undermined confidence in the legal process and caused significant disruption to small and medium-sized enterprises. Reform of the public sector and financial institutions must be accompanied by deeper systemic changes to the central decision-making processes of government. The establishment of a constitutional charter for the transitional period,5 setting out the roles and responsibilities of the transitional institutions, provides the government with an opportunity to improve coordination, reduce interference and remove parallel levels of decision-making. Public institutions such as the central bank of Sudan and elements of the judiciary must have their independence enshrined in law in order to protect their oversight capacities, including the central bank’s ability to set monetary policy.
Tackling corruption will require support for the rule of law and the building of accountable institutions at local and national levels. Serious efforts will be required to eliminate al-tajneeb,6 and end the practice of ministries keeping money aside for off-budget spending. Reports of the auditor-general have drawn attention to off-budget government spending, but have elicited no meaningful action.7 The transitional government should investigate the auditor-general’s findings and implement reforms, starting by authorizing Sudan’s ministry of finance to coordinate the budgets of all other ministries, including having greater oversight of the economic cluster of ministries.
Economic activity in Sudan is concentrated in a small number of companies, many of which are government-owned, and there are widespread accusations of the theft of public funds. Stabilization, including reform of agriculture or industry, will require the restructuring of private assets and dissolving of parastatal companies operating unlawfully. Hundreds of public and semi-public companies created by the former regime have in effect operated as vehicles to siphon off public funds, pay for political loyalties and facilitate Sudan’s political economy of corruption.8 The establishment of an anti-corruption commission and improvements in the business environment will help to reverse long-embedded bad practices and benefit companies that work in a positive and socially responsible manner.
5 An English-language translation of the August 2019 Draft Constitutional Charter for the 2019 Transitional Period, prepared by International IDEA, is available at http://constitutionnet.org/sites/default/files/2019-08/Sudan%20Constitutional%20Declaration%20%28English%29.pdf (accessed 25 Aug. 2019).
6 Meaning setting aside part of some state institutions’ revenues generated from bribes paid by citizens for routine transactions. These funds are not included in the state’s general budget.
7 Radio Dabanga (2019), ‘Financial excesses ‘SDG 560 million’ in Sudan states’, 19 March 2019, https://www.dabangasudan.org/en/all-news/article/financial-excesses-sdg-560-million-in-sudan-states (accessed 25 Aug. 2019); Radio Dabanga (2018), ‘Auditor-General: 15 Govt. companies manipulated 2016 accounts’, 7 February 2018, https://www.dabangasudan.org/en/all-news/article/auditor-general-15-govt-companies-manipulated-2016-accounts (accessed 25 Aug. 2019); Radio Dabanga (2017), ‘Financial irregularities in all Sudan states, auditor-general reports’, 24 November 2017, https://www.dabangasudan.org/en/all-news/article/financial-irregularities-in-all-sudan-states-auditor-general-reports (accessed 25 Aug. 2019).
8 Baldo, S. (2018), Sudan’s Self-Inflicted Economic Meltdown, Enough Project Report, November 2018, https://enoughproject.org/wp-content/uploads/SudanEconomicMeltdown_Enough_November2018-web.pdf (accessed 19 Sept. 2019).