Where Do Sudan’s Dollars Go?

On May 16, 2026

Muhannad Awad Mahmoud

How can a country that produces nearly seventy tonnes of gold annually — and possesses gum arabic, livestock, sesame, peanuts, and millions of expatriates across the world — continue to suffer from a chronic dollar crisis?

How can a nation with such resources appear to be in a constant state of foreign-currency scarcity, while the Sudanese pound continues to decline, banks remain unable to meet demand, and the parallel market functions as the real controller of the exchange rate?

This is not merely the question of a citizen standing before a currency exchange counter, nor the complaint of a trader searching for financing to import goods. It is the question of an entire state.

If Sudan produces approximately seventy tonnes of gold annually, then — according to current international prices — the theoretical value of this production approaches US$10 billion. That figure reflects gold alone, excluding revenues from gum arabic, livestock, sesame, peanuts, and remittances from millions of Sudanese working abroad.

Yet the Sudanese economy behaves as if it were a country that produces nothing at all. Dollars are scarce, the pound weakens, banks remain largely ineffective, and the parallel market has effectively become the country’s true bank.

The Shocking Gap

But the truly shocking figure lies elsewhere.

According to official figures, Sudan’s gold production in 2025 reached approximately seventy tonnes, while official exports through recognised channels amounted to only around 14.7 tonnes, generating roughly US$1.5 billion in revenue.

This is not a minor discrepancy explainable by timing differences or market fluctuations. It is an enormous gap that forces an unavoidable question:

If Sudan produces seventy tonnes of gold, where did the rest go?

Here begins the real story.

Sudan does not suffer from weak gold production. It suffers from weak control over the gold it produces.

The real gap is not between what we produce and what we need, but between what is produced and what actually enters the formal economic cycle. A significant portion of the gold never reaches official channels, never becomes part of foreign-currency reserves, and never returns hard currency to the banking system.

Some international estimates suggest that between half and two-thirds of Sudan’s gold production leaks outside official channels. If accurate, this is not a matter of isolated commercial violations, but rather a continuous structural haemorrhage of a resource that ought to constitute one of the pillars of the national economy.

Gold smuggling is not merely an economic offence; it is a direct drain on foreign currency. Every kilogram that exists outside the formal system simply means dollars that never enter the national economy.

Should the State Monopoly Gold Purchases?

The answer is: no.

Because a monopoly itself could become another gateway to opacity.

The state should function as a strong regulator and competitive buyer within the market — not as a monopolist controlling it entirely. In the absence of the highest standards of transparency, monopolising gold could merely shift the crisis from individual smuggling to a broader institutional ambiguity, especially if resources become instruments of exchange outside publicly declared economic frameworks.

The solution is not to close the market, but to make official sales more attractive than smuggling.

The state should enter as a strong purchaser, offering prices close to international market rates, rapid payment, and clear procedures, so that dealing through official channels becomes more profitable and secure than avoiding them.

Yet paradoxically, some current policies push the market in precisely the opposite direction.

The Central Bank and Gold Financing

The Central Bank of Sudan currently prevents commercial banks from financing gold transactions.

This policy may stem from understandable concerns regarding speculation or the diversion of banking liquidity away from productive sectors such as agriculture, industry, and trade. Gold is indeed a fast-moving and highly attractive sector for financiers.

Nevertheless, this prohibition requires serious reconsideration.

The solution is not to exclude gold from the banking system, but rather to integrate it intelligently into that system.

Well-regulated bank financing of gold — especially if linked to exports whose proceeds return through the financing bank — could transform gold from a potential burden into an effective monitoring instrument.

Instead of leaving the gold trade dominated by cash transactions, intermediaries, and the parallel market, the activity would move into the formal banking system. Export proceeds would become traceable, exporters would be identifiable, and foreign-currency returns would be more likely to flow back into the country.

The simple question is this:

If banks do not finance gold, who will?

The parallel market?

Middlemen?

Unrecorded cash networks?

Is the State Itself Distorting the Market?

Gold is not the only problem.

A more sensitive question emerges: are some state institutions themselves contributing to market distortions?

When government or quasi-government companies enter strategic sectors such as trade, exports, and natural resources without the highest standards of transparency, roles become dangerously blurred.

The state is supposed to act as the referee regulating the market — not as a player competing within it while enjoying privileges unavailable to others.

Once markets lose fairness in competition, they lose trust. And once trust disappears, capital begins searching for exits elsewhere.

The Silent Crisis: Trade in Export and Import Documents

We then arrive at one of the most dangerous silent phenomena in the Sudanese economy: the trade in export and import documentation — known locally as al-warraqa.

There are individuals who neither cultivate, manufacture, nor genuinely export goods, but instead trade in the documents themselves.

Export documents are sold. Import documents are matched against them. Settlements occur abroad between different parties, with obligations resolved outside Sudan without money ever passing through the Sudanese banking system.

Here lies the real danger.

Exports are supposed to generate foreign-currency earnings that return to Sudan, strengthen the banking sector, increase foreign-exchange supply, and relieve pressure on the Sudanese pound.

But when the process becomes an external clearing arrangement between export and import documents, exports may physically occur while their proceeds never return to Sudan at all.

In simpler terms:

The country exports… but the dollars never enter.

This is one of the most dangerous forms of silent economic bleeding because, although it may not resemble conventional smuggling, it produces precisely the same outcome: Sudanese resources leave the country without benefiting the national economy.

Customs Exemptions and the Drain on Dollars

Beyond this lies another dangerous and rarely discussed gateway for foreign-currency leakage: irrational customs-exemption policies.

Industrial exemptions are not inherently wrong. Every country uses incentives to support industry.

But the real question is:

Which industries are we supporting?

And what is the actual economic return?

When certain activities receive customs exemptions to import raw materials using scarce dollars while adding only limited real value to the economy, then we are no longer dealing with smart industrial policy but with a double haemorrhage.

Take some steel factories as an example.

If the actual activity consists merely of reshaping, rolling, or preparing steel for the local market — without deep industrial transformation, significant exports, or genuine technological transfer — then are we truly dealing with a strategic industry deserving broad support?

Or are we financing an activity that consumes dollars, benefits from exemptions, reduces customs revenues, and provides returns disproportionate to the privileges granted?

The problem is not the factory itself, but rather the state’s definition of “value added”.

Not every industrial activity deserves support.

Exemptions should be tied to clear criteria:

How many jobs were created?

How many dollars were saved?

How many dollars were earned?

Did the activity genuinely replace imports?

Or did it merely substitute imports of finished goods with imports of near-finished raw materials?

If we support activities that consume foreign currency without generating meaningful added value, then we are not building industry — we are financing a regulated depletion of hard currency.

Import Bans and Symbolic Solutions

Then came the Prime Minister’s recent decisions banning the importation of certain goods.

In principle, any country facing a foreign-currency crisis may resort to import rationalisation, and the logic itself is understandable.

But the key question remains:

What is the real impact?

If the banned goods are economically insignificant or largely symbolic rather than genuine sources of hard-currency leakage, then the decision may appear correct in form while remaining weak in substance.

Sudan’s dollar crisis is not fundamentally about biscuits and chocolate.

The real crisis is far larger:

Gold leaving the country.

Export revenues that never return.

The trade in export/import documentation.

Customs exemptions consuming dollars without real value creation.

Non-transparent companies.

And the total collapse of confidence in the formal system.

The Real Issue: Trust

Ultimately, everything returns to one core issue: trust.

In economics, people do not move according to slogans, but according to incentives and confidence.

If exporters feel official channels will punish them, they will evade them.

If expatriates feel the parallel market is fairer, they will transfer money through it.

If citizens lose trust in banks, they will hoard cash outside them.

If importers lose hope of obtaining dollars through official channels, they will seek alternatives.

Thus, the parallel market becomes not merely an illegality, but the natural consequence of the failure of official institutions to become the better option.

What Sudan requires is not simply tighter controls, but a monetary policy that makes compliance with official channels the most profitable and rational choice.

Exporters, expatriates, and traders do not move through patriotic slogans alone; they move through economic incentives.

If dealing with the state means fair pricing, speed, flexibility, and trust, people will come voluntarily.

But if it means losses, bureaucracy, and restrictions, they will inevitably search for alternatives regardless of the risks.

A Country with Resources — But a Leaking Vessel

Sudan does not appear to be a country poor in resources.

It appears instead to be a country with a perforated container.

The gold exists.

The exports exist.

The expatriates exist.

The private sector exists.

But the dollars never arrive.

The solutions themselves are not mysterious:

Reform the gold market through competition rather than monopoly.

Open regulated bank financing for gold and exports.

Subject state-owned and quasi-state companies to full transparency.

End the trade in export/import documents (al-warraqa) that drains export proceeds externally.

Review customs exemptions and link them to genuine value addition.