Simply .. Strategic Commodities Portfolio is a successful move by the CB

Dr. Adel Abdel Aziz Al-Faki 

‎‏adilalfaki@hotmail.com

The Central Bank CB ,in cooperation with the Bank of Khartoum, announced a portfolio dedicated to importing essential commodities, most notably petroleum products.
The leading bank in the portfolio is the Bank of Khartoum, which is in fact the main shareholder in it, in addition to the Bank of Sudan.
The term bank portfolio means mobilizing financing from a number of banks, and providing it in a specific period of time to finance agriculture, industry, or a specific service, or to import a specific commodity with an extended impact on other sectors.
The Central Bank’s policies encourage the establishment of financing portfolios, and these policies require the approval of the Central Bank CB before announcing them to the public, and they are under its supervision through the General Administration of Banking Supervision.
Usually, the portfolio consists of a number of banks, and there is a leading bank that manages the portfolio by collecting contributions from banks, managing accounts, distributing profits, and final liquidation, and it is rare for the Central Bank of Sudan CBS to enter itself as a shareholder in the portfolio.
The Central Bank of Sudan CBS’s choice to be a contributor to the portfolio, and its choice of one bank as a member and leader of the portfolio at the same time, has its objective justifications. The primary goal of the portfolio is to achieve stability in the exchange rate by ensuring the provision of financing for the import of basic commodities.
This goal can only be achieved through a very large capital, and through financial institutions capable of providing the value of the capital. According to the official statement issued by the Central Bank of Sudan CBS , the capital of the portfolio is one billion dollars, to which the Central Bank of Sudan CBS contributes $250 million and the Bank of Khartoum contributes $750 million.
It is clear that the Central Bank of Sudan CBS through its close monitoring of the banks’ conditions, found that the Bank of Khartoum is the only one that has the ability to contribute this large amount, which is $750 million, which has already been deposited in the portfolio’s accounts abroad.
The importance of the portfolio stems from the fact that: First, it will provide importers with dollars that will enable them to import the goods they are authorized to import without resorting to purchasing from the market. This will stop currency speculation and lead to stability in the exchange rate.
The second important issue is to unify the channel of dealing in importing basic commodities through the wallet window under the supervision of the relevant ministries and authorities such as: the Ministry of Energy, the Ministry of Trade and Supply, the National Audit Office and Economic Security.
These authorities will closely monitor import tenders to ensure that they are not fictitious, so that the wallet does not turn into a mechanism for currency trading under an official umbrella.
In a previous experiment, foreign currency was provided to import basic medicines, but it was magically transformed to import creams and cosmetics!
It must be emphasized that the wallet for importing basic commodities does not represent a comprehensive solution to our economic crisis. Sustaining the stability of the value of the Sudanese currency requires addressing the huge gap that is widening day after day in the trade balance between our needs for foreign currency for imports and our available resources for foreign currency. This is what we will detail later, God willing.