News24

Sudan reorganises ministry, cuts costs

2012-07-09 20:48

Khartoum - Sudan on Sunday named six cabinet ministers to posts re-jigged under austerity measures, official media said, as the government try to cope with oil revenues lost when South Sudan separated one year ago.

The consolidation and elimination of ministries chops five positions from a cabinet that had 31 members.
Among the measures, the ministry of international cooperation has been axed while the ministry of information has merged with culture, the official Suna news agency said.

Ministers are to be sworn in to their new posts before President Omar al-Bashir on Monday, it added.
Suna did not say how much money the consolidation will save the government.

Ministries responsible for defence and security, which analysts say take up a major portion of the budget, were not named as part of the restructuring.

Cost-saving

Last month Bashir fired all of his advisers in another cost-saving move.

Under measures which the government claims will save $1.5bn, Finance Minister Ali Mahmud al-Rasul also announced in June a phasing out of fuel subsidies, a rise in the VAT and other taxes, and a devaluation of the Sudanese pound.

Reducing fuel subsidies led to an immediate jump of about 50% in the pump price of petrol, fuelling inflation which has increased every month and which reached 30.4% in May.

Protests against already-high food prices began on June 16 at the University of Khartoum and spread to include a cross-section of people around the capital and in other parts of Sudan after Bashir announced the austerity moves.

Protests calling for an end to his regime have continued for three weeks in the longest-running public challenge to Bashir's 23-year rule.

Sudan has lost billions of dollars in oil receipts since South Sudan gained independence on 9 July last year, taking with it about 75% of Sudanese crude production.

A dispute over oil fees for South Sudan's use of the north's oil export infrastructure cost the Sudanese economy a further $2.4bn, the finance minister said in May.

The north has been left struggling for revenue, plagued by inflation and with a severe shortage of dollars to pay for imports.