June 18, 2020 / 4:53 PM / 24 days ago

Sudan approves plan to liquidate, privatise state firms

KHARTOUM (Reuters) - A Sudanese committee chaired by Prime Minister Abdalla Hamdok approved a plan on Thursday to liquidate many of the country’s 650 state-owned companies and privatise others.

It is the latest in a series of proposed reforms since Sudan began negotiating a non-funded programme this month with the International Monetary Fund (IMF) that could pave the way for international financial support.

Sudan is also scheduled to discuss potential support with international donors at a conference in Berlin on June 25.

Under the latest measure, a large number of companies would be liquidated “because some do absolutely nothing at all, make no profit or have no justification for being owned by the state,” Adam Harika, an adviser to the prime minister, said in a cabinet statement.

A government inventory identified 650 companies owned by the state, 431 of which belong to ministries or executive authorities and 200 to defence and the military.

Only 12 of the companies provided revenue to the finance ministry, Harika said.

The companies are expected to be put in three categories: continued state ownership, privatisation or no justification for continued existence, the statement said.

Sudan’s economy in a desperate state, with inflation at more than 100% and a currency tumbling as the government prints money to subsidise bread, fuel and electricity.

This week the government approved a plan to further open up the lucrative gold trade to private investors, allowing them to handle all exports and taking the business out of state hands.

It also announced an experimental programme of direct cash transfers to its neediest citizens as it tries to wean itself off costly fuel subsidies.

Until now Sudan has been unable to tap the IMF or World Bank for support as it has $1.3 billion of IMF arrears and is still on a U.S. list of state sponsors of terrorism, over a year after a popular uprising ousted autocratic leader Omar al-Bashir.

Reporting by Khalid Abdelaziz; Writing by Patrick Werr; Editing by Mark Heinrich

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