CAIRO, May 25 (IPS) – The conflict in Sudan is impacting the economy in Egypt, and those who make a living moving goods across borders have spent weeks hoping for the situation to normalize.
Muhammad Saqr, a truck driver, left Cairo with a load of thinners on April 13, heading for Khartoum. By the time he reached the border, battle had broken out. Saqr remained, like dozens of trucks, waiting for the borders to reopen.
On April 15, 2023, clashes broke out in Sudan between the army led by Lieutenant General Abdel Fattah al-Burhan and the Rapid Support Forces led by Lieutenant General Muhammad Hamdan Dagalo, known as “Hamidti”. According to the UN, the clashes left hundreds dead and displaced more than one millions of people, with 840,000 internally displaced while another 250,000 crossed borders.
Saqr was blocked at the border for 28 days.
“We started to run out of supplies and we made sure the situation would improve tomorrow. Twenty-eight days passed while we slept under the stars. The information we received from the bus drivers transporting the displaced from Sudan to Egypt convinced us that there would be no immediate relief. We knew that if we entered Khartoum alive, we would leave in shrouds,” Saqr told IPS.
“The trader to whom we were transferring the goods asked us to wait and not return (home), in particular because he could not pay the customs duties due to the closure of the banks.
Eventually they returned with the goods to Cairo, Saqr said.
Mahmoud Asaad, a driver, was stuck on the Sudanese side of the border. Due to customs papers and permits, the cattle he was transporting had already been stuck in the customs barn in Wadi Halfa, Sudan, for thirty days. Then, when the conflict broke out, the cows were trapped for another thirty days.
“We used to regularly transport animal shipments from Sudan to Egypt,” says Asaad. The average daily transport of animals to Egypt was around 60 trucks loaded with cows and camels. This trade ceased and many Sudanese importers fled to Egypt until the end of the conflict.
“Sudan is seen as a gateway for Egyptian exports to markets in the Nile Basin and East African countries, and continued war and insecurity will reduce trade volumes. trade between the two countries, which will have a negative impact on the Egyptian economy, which is currently experiencing some crises,” Matta Bishai, head of the Domestic Trade and Supply Committee of the Importers Division, told IPS. of the General Federation of Chambers of Commerce.
According to Bishai, commodity prices have risen significantly in recent months as the Egyptian pound has fallen against the US dollar. He also said that the current situation in Sudan will lead to further price increases in the coming months, especially for products imported from Sudan, such as meat.
Bishai explained that while Egypt had an abundant domestic supply of meat, it was nevertheless dependent on imports. Importing it from other countries like Colombia, Brazil and Chad would take longer and cost more than importing it from Sudan, because land transportation is more convenient and cheaper than sea transportation.
According to Bishai, Sudan is a major supplier of livestock and live meat to Egypt, supplying around 10% of Egypt’s needs. Rising meat prices will put additional pressure on inflation rates in Egypt.
“Rising commodity prices, combined with the current situation in Sudan, are expected to lead to higher inflation rates in Egypt in the coming months,” Bishai said.
According to data from the General Authority for Export and Import Control on trade between Egypt and the African continent during the first quarter of this year, Sudan ranked second among the top five markets receiving Egyptian exports, valued at $226 million.
According to Ahmed Samir, Egypt’s Minister of Trade and Industry, Egypt’s trade volume with African markets amounted to around $2.12 billion in the first quarter of this year, the value of exports Egyptian commodity imports to the mainland totaling USD 1.61 billion and Egyptian imports from the mainland totaling USD 506 million.
Mohamed Al-Kilani, professor of economics and member of the Egyptian Society for Political Economy, said: “The negative consequences will be felt in trade, which has recently increased and reached 2 billion dollars. Egypt tried to speed up the process of importing from Sudan by expanding the road network and building a railway.
Credit rating agency Moody’s has warned that if the conflict in Sudan drags on for an extended period, it will have a negative impact on the credit of neighboring countries and on multilateral development banks. Moody’s added that if the clashes in Sudan turn into a long civil war, destroying infrastructure and worsening social conditions, there will be long-term economic consequences and a decline in the quality of assets of Sudan’s multilateral banks, as well than an increase in non-sound credit assets and liquidity.
As the conflict entered its sixth week, ceasefire attempts failed – with both sides accusing each other of breach of agreements.
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© Inter Press Service (2023) — All rights reservedOriginal source: Inter Press Service
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