Khartoum, (Sudanow)- The Statement of the President of the Republic
The National Legislature
Praise be to Allah the All-Powerful the All Mighty, and Peace and Blessing be Upon His Messenger, His Relatives and his Companions, and those who followed his path, from here to doomsday. We pray to Allah to protect us against troubles in gaining livelihood, and to stave off fear from us mortals, and we pray to Him to grant us victory via the right path and via honesty. He is capable to do so, and in His hands all rest.
Dear Brother, Speaker of the National Legislature
Members of the Legislature,
We stand here before your august Legislature, once again, during this session following our first opening statement on the ninth of last April. You probably remember that on the second day following that statement an aggression was staged against Higlig.
You have been witness to the stand of your Armed Forces and other Regular Forces beside the Popular Defense Forces, and beyond them the strong position of our gallant people, who came out en mass in a unique national drive that left the world mesmerized, to repulse that vicious attack, which was nothing but a continuum of the aggressions targeting the stability and security of our homeland, seeking to impede our progress and development, by fanning the flames of wars at its peripheries. To this end they resorted to using stooges and mercenaries in a war by proxy, spearheaded by the state of South Sudan, for which some circles- that are well known to our people - are actively engaged in supporting them financially and diplomatically and through the media cover-up.
Let us stand all, dear brothers and sisters, to salute the spirits of our martyrs, and our people. Let us prayer for a speedy recovery for our wounded, Let us say al-Takbeer for the victory Allah has bestowed on us and let us prayer for the victories scored.
The events in Higlig, and the continued aggressions on other peripheries of the homeland, need preparedness and readiness on our part to counter them. These aggressions have negative repercussions. These included the cost of halting of oil production and the rehabilitation of the oil facilities. Moreover, and even though these costs are not the reasons behind the current economic problems, they nevertheless have brought further burdens that aggravated them and pushed them into a new levels.
The economic repercussions that the National Economy faced have led to its weakness. The same is caused by the increase in the state expenditures, which are brought by our spending on peace agreements and the Federal System of Government as well as the implementation of the Local Government system, nation-wide. The government spending on the various institutions has increased, the social consumption doubled during the past few years, the gap between the exports and import has widely grown. This has consequently led to imbalance in the trade exchange, particularly after all oil revenues have been lost.
Sudan is no longer oil exporter; rather, it has become an oil importer that purchases the commodity locally from the partners at international prices and sometimes it imports it from outside the country. In addition, despite the relative improvement in the revenues of the non-oil export such as that of gold, the gap remains wide, a matter, which led to weakness of the exchange of the local currently, and it almost made it uncontrollable and out of the command of the momentary authority in the country. Likewise, the deficit in the state budgetary balance has increased due to emerging security developments and increase in the prices of import from the international markets, matter that led to the rise of inflation and to prices hike.
Dear Brother Speaker of the Legislature…
Brothers and Sisters,
The enemies plotting against Sudan thought we would not be able to remedy our economic problems and that this would lead to an economic collapse and the country would be destabilized, and its security shattered. However, with the help of Allah the Almighty and His Assistance and Guidance, we will prove them wrong and they will verily be disappointed.
We, relaying on Allah the Almighty and on the confidence of our people, have taken a number of integrated measures, decisions, and directives that would ultimately restore our economy to its healthy and right pathway. And I would like to lay before your August Council the main features of those decisions and directives.
First in the domain of rule and administration
Effect a structural reform in the apparatus of the government and administration, by reducing the number of construction posts at the level of the Presidency of the Republic and the establishments it supervises, the national legislature. The cut will also cover a number of federal ministries, the minister and the state ministers, the experts and the contracted officials that work within the presidency of the republic and council of ministers, covering over a hundred areas. At the state and local levels, the cut will cover all constitutional posts, positions and other positions of similar nature, in the executive and legislative domains, ranging between 45% to 50%, respectively, and covering over 260 state positions.
Cut the amenities and privileges for the constitutional post holders at the centre and state levels, including cuts in the salaries and the allowances, travels, specifying a car per one official, and ending all types of motorcades accompanying high-level officials.
Reconsidering of the authority for the creation of localities and making it a joint power shared by the centre and the state with the view to draw unified standards for the establishment of localities and for revision and cutting down of their number as well as pacifying their mandate and missions in a way that would boost their capacity to provide services for the citizens.
Cancellation of all salaries and allowances provided for the member of the legislative councils at the locality level and replacing them with symbolic allowances in a way that will not overtax the services budget and will on the other hand reduce the burden over the citizens. The necessary Decisions and directives will follow during the coming few days immediately upon approval by your august council of this statement, and the detailed specifications to be covered by the speech to be presented by the Minister for Finance and National Economic, next Wednesday.
Second: in the Economic and Financial domains domain
We have decided to cut and rationalize public expenditures as follows:
Revision of budgets and specifying priorities for spending, particularly in the first chapter (salaries and wages) and tightening of the control procedures.
Trim the state structure and cut the allowances for the constitutional posts holders in the manner cited above.
No more new public establishment construction
Exercise strict control over government buying and purchase contracts and focusing on purchase from local markets
Rationalization of fuel use in government units to the lowest minimum.
Right control on measures used to grant tax exemptions
Continue with the progamme of liquidation and privatization of public companies, which was initiated by the liquidation of 27 companies last year.
Strict adherence to the rules of the financial and accounting procedures, the purchase and contracts bill of procedures. Commitment to the rules for public recruitment, promotions and appointments.
All state organizations and apparatus shall be subjected to inspections by the national auditor chamber, allowing no evasion from the revision and accountability procedures.
The Ministry of Justice is instructed to speed up procedures for bringing to justice all cases of crimes against public money, so that prompt action is taken by the Judiciary.
In all those procedures, we rely on the supervisory role to be played by the citizens, the Sudanese public opinion, the media apparatus, the press and other means of communications. And we would like to express our appreciation for the role played by some committees of your august council, in collaboration with the auditor general chamber, to implement the rule of law and to control and correct any violations.
In the domain of earnings and increasing them: -
We will issues decisions that seek to increase earnings as follows:
Increase the development tax on imports.
Increase the sectors under the value added tax.
Increase the business taxes on business for the banks sector.
Increase the tax efficiency and combat tax evasion.
Prevention of smuggling in particular through border with the state of south Sudan.
Sale of housing and investment plots in coordination with the states for the expatriates, in hard currency.
Remedy of the phenomenon of sparing of financial resourcesby some ministries and government institutions. A high-level committee, headed by the first Vice President of the Republic has been set to follow up the matter.
Removal of all deformities in the petroleum material dealings, by gradual lifting of subsidies to fuel materials.
As you are aware, brothers and sisters, a substantial share of the budget is allocated for subsidy of fuel materials that used to be subsidized from the share of oil export revenues of the government of Sudan. After the loss of this resource, the subsidy has become a subsidy by deficit, at the expenses of the poor taxpayer, for the benefit of the high-income sectors. This is because the subsidy comes at the expense of each penny at the hand of the poor or the rich, on equal footing. One of the greatest defaults of the indirect subsidy is that those who are most capable are the one who benefit from it more than the others do. Thus, we became like taking from the poor to subsidize the rich. It is known that in situation like our country, one cannot do away with the subsidies. But the most efficient subsidy and the most fair is the direct subsidy that goes directly to those in need and vulnerable. Those are the citizens that have to be prioritize in any subsidy and it is because of those that we are receiving diving blessing in our resources and our riches. Thus, gradual removal of the indirect subsidies will be the government direction and its future policy. This is a policy that was approved by your august council when you approved the current general budget where we promised to come up with a plan to gradually reduce the harmful effect of inflation and prices hike. Here we are now doing as promised.
We have made a commitment to side by the poor and the limited income persons, through gradual lifting of indirect subsidies on fuels that makes the capable citizens and the foreigners, individuals and companies and organizations, benefit from the assistance that the simple citizens take part in providing. And it is this simple citizen who should be given priority in allocation of such resources that will go to improve his living and develop the necessary basic services. This is a measure that will also combat smuggling which renders fuel we purchase from outside the country or from partners in local production go to those who wage war against us, those who seek to destabilize our country and undermine its security and halt the wheel of development therein.
Brothers and Sisters,
We are well aware of the burden such economic remedies will through on the shoulder of the general public, and on the poor in particular, and had we been able to avert them we would not hesitate second to do, but we promise to do our level best to alleviate the effects of these policies on the poor and the limited income citizens, and to do so we will adopt the following measures:-
We will continue to exempt wheat, wheat flour and sugar from all taxes and fees
We will reduce excise duties imposed on powered milk and on food oils
Drugs and food additives will be exempted from excise duties
Assistance will be provided for vulnerable sectors through increase of social assistance and through widening of the network of social insurance to ensure that assistance is reaching the real beneficiaries, whose number will increase from 500 thousand to 750 thousand families
A financial grant will be allocated for the workers and the pensioned persons.
Reactivation of the microfinance mechanism so as to help contribute in combating poverty and provide employment for graduates.
The governments in the state of Khartoum, and other states around the country, have already started procedures in provision of basic commodities through the private sector and cooperatives so as to fight scarcity and prices hike. The government will also spare no effort in provision of the basic commodities without seeking to make profit at the expense of the poor and vulnerable.
I would like to stress once again that there would be no increase in the prices of wheat and wheat flour or those of drugs, there would be no increase in the fare of interstate public transport or fare of local transport in Khartoum state, after the approval of those measures.
Brothers and sisters
The adoption of the said financial measures as cited above necessitates adoption of parallel measures in the monetary sectors which we sum up as follows:-
Rationalization of demand for foreign currencies
Move the rate of exchange so that the difference between the official rate and the parallel market is closer, using to this end the market mechanisms to achieve the stability in the rate of exchange, as the amended budget has been prepared in line with a rate of exchange of 4.4 Sudanese pounds a USD, with the exception of wheat and petroleum products that are purchased at a price that was in the already approved budget.
Increase the legal cash reserve
The central bank of Sudan continues to purchase gold at a market price, provided that the subsidy will shift from that provided for the rate of exchange to a subsidy for the balance.
Employ the foreign currency reserves to cover the gap in the basic and essential commodities such as fuel, sugar, wheat and drugs
Draw new measures for withdrawal for the travel purposes (medical treatment or study or hajj or Omra)
Quest for obtaining more grants and loan provide some development projects as collateral for obtaining foreign currency from abroad
Dear brothers and sisters
For the package of economic reform procedures to be complete, work to increase production and productivity has to achieved. Therefore we will centre on the priorities of the economic programme on agriculture, animal wealth, industries, and oil, mining and basic infrastructures. The government has achieved a noticeable progress in this regard during the first half of the current fiscal year, by providing about 2 billion Sudanese pounds as follows.
Provision of financing for the agriculture fund, worth 50 million pounds, for the industry fund ;worth 10 billion pounds and the animal wealth fund worth 8 billion pounds
Provide a funding for the agricultural season 2012-2013 worth 100 billion pounds
Provision of finance for the resettlement of the persons affected by the heightening of Roseris Dam, worth 225 billion pounds
Provision of finance for funding the import of wheat for the strategic reserve, worth 336 billion pounds
Provision of finance for the water harvest projects, worth 297 billion pounds
Provision of finance for the rehabilitation and maintenance of the Gezra scheme irrigation network, worth 100 billion pounds
Provision of finance for production of edible oil seeds projects irrigation, in Sinnar State, worth 150 billion pounds
Provision of 300 million USD for purchasing of agriculture machinery
Provide funding for agricultural input, worth 650 pounds
Also the industrialization programme in the sugar, fodder, meat, and hides will receive funding via the investment partnership and other funding widows.
Gold, one of the blessing that Allah has bestowed on the people of the Sudan , we, after thanking Allah by our saying , will thank him by our deeds which is perfecting our performance and by increasing our production and productivity, handing the environmental and social problems of mining with care,, thus increasing our receipt and combating smuggling. On the same path of appreciating the many blessings that Allah bestowed on us, Sudan will continue its quest to increase petroleum production through its emergency ….programme the ministry of petroleum has adopted with the concerned companies. We were able to fix the oil facilities in Higlig area in a record time and you will; Allah willing, the fruits of this effort showed when oil production increases to 180 thousand barrels by the end of the current fiscal year, a good omen for an improvement that will not be far, Allah willing.
Brothers and sisters
We are a people who rely on Allah, in whose hands things run, the donor of lives, He who wills and denies blessings: if Allah the almighty bestowed his blessing on us, we thank him, and if He tests our faith by an ordeal in money, capital of food shortage, we observe patience. This is the attitude of the true believers in Allah the almighty. They will not be vanquished by any mortal force, and no mundane power whatever its might would be able to subjugate them to its whims. In the life of nations, comes moment that lines are demarcated and the right is restored. Therein the true leadership will not hesitate, now will it turn a blind eye to the options and measures available before it, taking the most appropriate and suitable, having consulted and asked for divine inspiration. This is because there is no good in a leader who will not lead and in a guide who will lie to his people.
The package of measures now between your hand does not come out isolated or as an emergency measures, it has, rather, to be seen within the context of the national strategy and as part of the three year economic programme. It is a step towards the rationalization of the performance of our economy, reduction of inflation and increasing of the rate of growth. These are our contributions, our thoughts and our efforts, and we pray to Allah to lend us via this plan, the rational pathway for our homeland. We pray to Allah to bless our measurements, our weights, our products and our produce, to lead us all to the righteousness path and lead all our way to the even path, He is the all-capable and upon whom we relay.
And Peace and Blessing of Allah be upon you