Sudan’s central bank instructed banks to unify the country’s official and black-market exchange rates on Sunday, a move expected to significantly devalue the Sudanese pound.
The change aims to help the country overcome a crippling economic crisis during a fragile political transition, and access international debt relief following an International Monetary Fund monitoring program.
The bank did not say at what rate the exchange rate should be unified, but a letter of instruction from the central bank said it would set a daily base rate according to the market price among banks and exchange houses.
The instructions said banks must declare rates within 5 percent above or below the central bank rate based on market supply and demand, and that their profit margin between buy and sell prices should be no more than 0.5 percent.
Analysts say unifying effectively means moving close to the far weaker black-market rate since almost all transactions are calculated at that rate. Recently, the dollar traded between 350 and 400 Sudanese pounds on the black market, against an official rate of 55 pounds to the dollar.
Saturday’s move had been expected late last year under the IMF program but was delayed by political instability.
It comes two weeks after Prime Minister Abdalla Hamdok appointed a new government to include rebel groups that signed a peace deal in October.
Hamdok is serving under a joint military-civilian council that took power after the overthrow of autocrat Omar al-Bashir in April 2019.