Farmers in Sudan are ready to get back to work – private investment can get them there

A recovery roadmap, and potential external investment of $155 million, is one of the outcomes three days of dialogue held this week in Khartoum, organized by the United Nations Development Program (UNDP) and the Sudanese Ministry of Finance.

More than 300 participants from 20 countries – representing Governments, financial institutions, national and international private sectors, farmer and trade associations, and other stakeholders – registered for the event.

A ‘stepping stone’ forward

“This dialogue is a stepping stone to encourage more private sector involvement, on which socio-economic recovery ultimately depends,” said Arvind Kumar, Head of the Recovery and Resilience Team at the UNDP Office in Sudan.

He says UN News that focusing on the private sector is very important because this sector provides around 98 percent of jobs.

Speaking from the capital, Kumar described an economy devastated by the war but not completely paralyzed. Sudanese farmers continue to grow crops, goods are still transported, and markets still function in some areas.

But in the past two years, yields have declined by 40 to 70 percent in some caseshe said, while the costs of agricultural inputs such as fertilizer and fuel were increasing due to the crisis in the Middle East and the Persian Gulf.

“The third and most important aspect is that there is not much injection of funds from the private sector into the economy,” he said. “And they are willing to come back.”

Millions of people are starving

Kumar stressed that “food production clearly does not meet Sudan’s needs,” and highlighted the huge impact of the civil war that erupted in April 2023.

Brutal fighting between the Sudanese Armed Forces (SAF) and its former ally, the Rapid Support Forces (RSF) has left more than 19 million people facing famine. Nearly 35 million people need humanitarian assistance and 13 million people have been forced to flee.

Before the war, Sudan exported gum arabic, sesame, cotton, hibiscus, sorghum and livestock, he said, and once had a 12 to 13 percent share of the global sesame market, it has now fallen to six percent.

Although livestock exports have continued, the share of “high-value agricultural products” has declined as most companies have lost assets and lack access to capital, “making it very difficult for them to come and rebuild, so it takes time.”

Meanwhile, UNDP analysis shows that 90 percent of farmers cannot access financing, and “with aid support alone, they will not be able to continue increasing food production.”

Recognition, recovery and potential resources

He said the dialogue in Khartoum concluded with “three key outcomes”: recognition of the need for continued engagement with the international and national private sector, implementation and support of a private sector recovery roadmap in agriculture, and “exciting investment potential” of nearly $155 million from Pakistan, India, Turkey, Egypt and Syria.

Participants also discussed the need to reconnect farms with markets and ultimately buyers, while business owners raised concerns about regulatory barriers and the difficulty of establishing relationships with international investors.

Financial support for farmers

UNDP is exploring steps to provide more support to farmers through the banking system, such as credit guarantees.

They are also working with the national and international private sector to restore the warehouse receipt system – a process that allows farmers to store produce at approved facilities and receive a receipt that can be used to obtain financing.

Trade facilitation is another top priority. UNDP is working closely with Sudanese authorities responsible for customs and ports, as well as UN trade and development organizations UNCTAD“to review necessary reforms for ease of doing business.”

Mr Kumar said people needed education, health services, electricity and jobs to rebuild their lives. He stressed that development must begin alongside life-saving humanitarian assistance “and there is opportunity and space to get development back on track.”