Central Bank of Sudan Policies 2010

The Central Bank of Sudan Policies for the Year 2010


The Central Bank of Sudan Policies for the year, 2010 have been introduced in consistence with the pillars of fiscal policy (General Budget) and in accordance with the Five Years Strategic Plan of the Central Bank (2007 – 2010). These policies target an optimum volume of liquidity that will conform with the requirements of economic growth and financial and monetary stability. Indirect instruments appropriate to the dual banking system will be utilized, aiming to maintain soundness of the financial sector, boost its efficiency and continuing combat of the money laundering operations.

Also, the policies aim at diffusing banking awareness, increasing banking spread in the rural area, stimulating savings, mobilizing medium term resources, through encouragement of banks to attract investment and savings deposits and working toward the reduction of financing cost in collaboration with the relevant entities. Moreover, the policies strive to secure coordination and continued cooperation between the monetary and financial policies and the other related policies.

Furthermore, the policies have accommodated the partial recovery of the Sudanese economy from the impact of the international financial crisis, the influence of this recovery on the general budget and the banking and private sectors and the importance of reviewing the policies which were adopted in this respect in order to contribute for improving performance of the macro economy.

Policy Guidelines

The Central Bank Policies have been issued according to the following guidelines:

  • Continuation in implementing Article (14) of the Wealth Sharing Protocol, pertaining to the monetary, banking and lending policy.
  • The Five Years Strategic Plan of the Central Bank ( 2007 – 2011 ).
  • The Government General Budget for the year, 2010.
  • Coping with the internal developments (Non-performing loans, micro and mini finance) and the international developments (effects of the inter-national financial crisis).
  • Guidelines of the Government's strategy for alleviating the severity of poverty, for the purpose of achieving the developmental objectives.

Policy Objectives

In the context of these guidelines, the objectives of the Central Bank Policies for the year, 2010 are represented in:

Maintaining monetary and financial stability by achieving a one-digit inflation rate, by targeting a balanced growth in money supply.

Provision of adequate liquidity for the economy in a manner that achieves the targeted growth in the Gross Domestic Product ( GDP ).

Increasing the contribution of the private sector to the GDP through increasing banking finance to the sector.

Provision of financing to the productive sectors and provision of medium term finance.

Achieving durable stability of the exchange rate by enhancing its flexibility within the framework of the managed flexible exchange rate regime and considering the shift from pegging of the national currency exchange rate to a single foreign currency to pegging to a basket of currencies.

Continuation in the rationalization of demand for foreign exchange, rationalization of importation, increase of supply by focusing on promoting non-oil exports, as well as working toward the encouragement of direct foreign investment flows and building of the reserves.

Development of the Islamic finance modes.

Improvement of the efficiency and reinforcement of the soundness of the dual banking system ( Financial positions, performance and assets of banks, dealing with non-performing loans and protection of the sector from the impact of the international financial crisis ).

Continuation in activating micro-finance policies and programmes and financing with a social dimension for mitigation of poverty.

Lower the percentage of banks' non-performing loans to inter-nationally recognized limits.

Continuation in the banks restructuring programme by encouraging banking merger operations.

Setting up the credit information agency for building a data base on banks' clients.

Initiation of classification for the financial institutions ( Ratings ).

Continuation in implementing the policies, regulations and measures relating to corporate governance and good governance.

Activation and development of the indirect instruments of control over the banking system.

Reinforcement of the role of the National Agency for Insurance and Financing of Exports in the promotion of non-oil exports.

Development and promotion of the payment and settlement systems through application of the Real Time Gross Settlement ( RTGS ) system and joining the Regional Payment and Settlements System ( REPSS ) of the COMESA countries and the Arab countries.

Completion of work with regard to the protection and security programmes.

Continuation in redressing the adverse consequences of the international financial crisis, taking advantage of the lessons learned therefrom and offering the Islamic banking system as an ideal alternative and option for dealing with crises.

Based on these guidelines and for achieving these objectives, the Central Bank of Sudan policies have been pursued up for implementation through the Islamic window in the North, in accordance with the Islamic banking standards and, via the conventional window in the South according to the conventional banking practices under the supervision of the Bank of Southern Sudan – the Branch.

The Central Bank of Sudan policies for the year, 2010 include the following:

  1. Monetary policy.
  2. Credit and foreign exchange policies.
  3. Banking and supervision policies and development of payment systems and technology :
    1. Regulation and development of the banking system policies.
    2. Supervisory policies.
    3. Payment systems and technology policies.
  4. Currency management policies.
  5. Micro and mini-finance and banking finance policies with a social dimension.