Gold… Sudan’s New Calamity

By Abdulmalik Al-Naeem Ahmed

When Sudan’s former Ingaz (Salvation) government succeeded in exploiting oil—after more than twenty years of its discovery in the mid-1970s by Chevron—it had initially sought to keep the discovery secret, considering it a reserve asset to be used at a time of its choosing. Eventually, the government managed to extract the oil, but failed to channel its revenues in a way that would achieve balanced and sustainable development across the country.

When oil production began in 2005 and the resource entered the Sudanese economy, sound reasoning dictated that its revenues should have been directed toward strengthening the infrastructure of both plant and animal agriculture. Agriculture, being a renewable and non-depletable resource, represented a more sustainable foundation than mineral wealth, which is by nature finite. Sudan’s vast agricultural potential—over 200 million arable acres, multiple year-round rivers, seasonal rains supporting mechanized farming, and more than 120 million heads of livestock—could have multiplied any investment many times over. Had the government allocated a portion of its oil income to agricultural and irrigation infrastructure, Sudan might today possess a strong and resilient economy. But that did not happen—and there is little use crying over spilled milk.

The oil story ended with South Sudan’s secession, and a new mineral took the stage: gold. Yet the gold boom has been marred by serious mismanagement and abuses that have deeply damaged Sudan’s already fragile economy. Over 88% of gold mining is artisanal, contributing only crumbs to the state treasury amid official silence and tacit complicity. Sudanese and foreign companies involved in the sector have likewise failed to deliver substantial revenue to the state—leaving the national currency in free fall.

Adding to the chaos, vast gold-rich territories have fallen under the control of armed groups—most notably the Rapid Support Forces (RSF), which, bolstered by gold profits and foreign weapons (notably from the UAE), turned against both the state and its people. Even some armed movements now aligned with the national army have their own lucrative gold investments, ensuring their financial independence.

Tensions have also escalated between gold companies and the Central Bank of Sudan, after the latter decided to monopolize gold exports, excluding even its own commercial banks. Opinions differ about the decision’s merits, but what’s clear is that it failed to achieve its intended goal of stabilizing the local currency, which has instead suffered unprecedented depreciation. This calls for a thorough review and assessment to identify the real causes of this ongoing decline and how to reverse it.

The conflict between the companies and the Central Bank is not entirely innocent or in the interest of the national economy. The obstruction of public policy by private interests is nothing new in Sudan. Many major national projects have been sabotaged over the years to protect the privileges of powerful individuals or companies, in the absence of true rule of law—one of Sudan’s deepest and most persistent governance failures since independence.

Like many observers, I followed the public spat between the gold companies and Central Bank Governor Buraie Sadiq, who was dismissed yesterday amid reports of serious administrative irregularities—ranging from favoritism in appointments to questionable promotions and oversight failures. The dispute ultimately ended with his departure.

This raises several questions for economists to consider:
Was the problem rooted in the governor’s personality, or in the state’s broader economic policies—including those of the Central Bank itself? Should the Bank even act as a trader on behalf of the state, in gold or otherwise? Or should it restrict itself to setting and supervising monetary policy, leaving commercial activity to private banks under its regulation?
Will replacing the governor, without addressing these deeper structural flaws, truly solve the crisis of gold trade and currency collapse? A leader’s personal competence can influence institutional success, but often reform-minded officials face powerful resistance from those whose interests are threatened by change—resistance that can only be curbed by enforcing the rule of law.

So, does the dismissal of the former Central Bank governor represent a victory for the companies that opposed his policies, or merely an attempt to ease tensions and acknowledge policy failure?

Finally, will the so-called Government of Hope reconsider the qualifications required for whoever manages the Central Bank—entrusting the role to someone capable of handling such immense responsibility? Or will it gradually lift the Bank’s monopoly over the gold trade, thereby reducing tensions that have clearly contributed to the currency’s collapse—alongside many other factors?

And perhaps the most crucial question of all: Can gold become a blessing for Sudan, after having turned into a curse that enriched companies and individuals more than it ever filled the empty coffers of the state?