From a Revenue-Extraction Economy to a Productive Economy: A Necessary Path of Correction for Sudan

Dr Mohamed Awad Mohamed Metwally
The current predicament of the Sudanese economy is not merely a crisis of isolated fees; it is a crisis of a development model built on extraction rather than production. The way out requires a transformation in the philosophy of fiscal policy, grounded in practical recommendations that redirect resources to expand the productive base, protect human capital, and rebuild trust between the state and society.
When the relationship between the state and the citizen becomes one of relentless extraction without any tangible return in services or quality, the social contract enters a phase of silent erosion. What Sudan is experiencing today goes beyond the issue of pricing government services; it reaches the very core of the prevailing economic model — a model dependent on levies and charges as the principal source of public revenue. This has weakened production, burdened households, and reshaped the behaviour of economic actors towards evasion and informality. A careful reading of the burden of these levies, both domestically and abroad, reveals that what we face is not merely a crisis of fees, but rather a crisis of fiscal governance, a crisis of developmental vision, and a crisis of trust between the state and society.
For years, Sudan has suffered from a shrinking productive base and the declining role of value-added agriculture and industry. At the same time, fees and levies have proliferated at federal, state, and local levels. The logical consequence of this imbalance is that the burden is transferred entirely to the final consumer. Every transport levy, every charge on production inputs, and every administrative fee is added to the marginal cost of goods and services, eventually becoming higher market prices. In an economy characterised by weak domestic supply and heavy reliance on imports, demand remains relatively inelastic in the short term; consequently, the burden is passed on almost in full.
Economic analysis indicates that most citizens directly associate the abundance of fees with the rising cost of living. At the same time, a comparable proportion believes these charges have exceeded the public’s economic capacity under current conditions. These are not passing opinions, but reflections of daily realities people encounter in education, healthcare, transport, and government services.
More dangerously, this model undermines human capital itself. When the costs of education, examinations, and certification rise to levels citizens regard as an unbearable burden, entire segments of youth are effectively excluded from pathways to knowledge and empowerment. When over ninety per cent of people believe that treatment and diagnostic costs obstruct access to healthcare, society faces a gradual erosion of public health, with direct implications for labour productivity and competitiveness. If fewer than one per cent still believe healthcare is genuinely free, the extent of the state’s retreat from providing minimum social protection becomes unmistakable.
The situation is even clearer in transport and logistics. There is near unanimity that road transport fees inflate commodity prices, and two-thirds of respondents identify the ordinary citizen as the ultimate bearer of this burden. The side effects extend far beyond inflation; they include encouraging smuggling, increasing freight costs, weakening formal trade, and creating shortages of certain goods. In effect, the present system punishes compliance while rewarding evasion, thereby expanding the informal economy and contracting the tax base. The state then responds by imposing further levies on the same shrinking base, thereby entering a vicious cycle.
At local government level, the same pattern recurs. An overwhelming majority describe municipal charges as excessively high and believe they directly increase the cost of goods and services in local markets. The lack of coordination among federal, state, and local authorities has created a hidden, cumulative tax burden that raises the overall cost of economic activity without corresponding improvements in public services. Simultaneously, the vast majority of Sudanese believe these fees are imposed without a comprehensive study, are inconsistent with citizens’ economic realities, and stem fundamentally from dependence on extraction rather than production, compounded by poor economic management.
Taken together, these indicators portray an economic model based on extraction rather than production, rent-seeking rather than value creation, and short-term fixes rather than strategic planning. This model carries a double cost: a direct economic cost manifested in inflation and distorted incentives, and an indirect social cost reflected in declining trust, the erosion of the middle class, and rising vulnerability among weaker groups.
Escaping this predicament requires a transformation in the philosophy of fiscal policy — a shift from extraction to empowerment. Every government fee should be subjected to three rigorous tests before approval. The first is the production impact test: does the fee encourage economic expansion or suffocate it? The second is the fairness test: does it reflect the ability to pay and protect vulnerable groups? The third is the transparency and accountability test: does the citizen understand what they are paying for, and is there a mechanism to measure the quality of the service provided in return? The absence of these standards is what has produced the present reality.
Based on this diagnosis, the alternative path rests upon four integrated pillars.
The first pillar is expanding the productive base. Any fiscal reform unaccompanied by growth in productive agriculture, industry, and services will remain little more than temporary patchwork. Sudan requires clear policies to promote import substitution in strategic goods, localise production inputs, and strengthen domestic value chains. Every pound invested in production creates a new and sustainable tax base while reducing reliance on arbitrary levies.
The second pillar is redesigning the fiscal system itself. Simplification, unification, and digitalisation are the keys to reform. The multiplicity of charges, the overlap of collection authorities, and the absence of electronic integration create fertile ground for corruption and waste. Sudan needs a unified federal law governing municipal fees, a single electronic payment system, a legislative ceiling on the total fiscal burden on any economic activity, and the abolition of low-yield charges whose administrative costs exceed their benefits.
The third pillar is protecting human capital. Genuine development cannot coexist with education and healthcare fees that drive families away from schools and hospitals. Sudan requires targeted support systems reflecting the ability to pay, shared healthcare financing mechanisms. It guarantees that any increase in fees corresponds directly to measurable improvements in service quality and user satisfaction. Investment in people remains the only investment capable of multiplying returns over the long term.
The fourth pillar is rebuilding institutional trust. More than ninety per cent of respondents express distrust in existing mechanisms for imposing fees. Restoring confidence requires complete transparency in publishing fee structures, involving the private sector and civil society in their review, linking fees to measurable performance indicators, and establishing effective, rapid grievance mechanisms. Trust is the hard currency without which no fiscal policy can succeed.
From these pillars emerges a comprehensive package of strategic recommendations that move beyond partial remedies towards structural transformation.
The first recommendation is to adopt a national strategy to expand the productive base, focusing on contract farming and value-added industries in sectors where Sudan enjoys comparative advantage. Expanding production remains the only sustainable way to broaden the tax base without increasing the burden on citizens.
The second recommendation is to establish a structural transformation fund to finance import-substitution projects in pharmaceuticals, food production, and industrial inputs, thereby shifting resources from financing consumption to financing productive capacity.
The third recommendation is redesigning the tax system around value-added taxation rather than multiple transaction fees, thereby reducing distortions and increasing efficiency.
The fourth recommendation is to set a legislative ceiling on the total fiscal burden on any economic activity, ensuring it does not exceed a defined proportion of value added, thereby preventing destructive cumulative taxation.
The fifth recommendation is to abolish low-yield, high-cost fees while retaining only those that generate meaningful net returns. Every charge must justify its existence economically.
In the field of human capital protection, the sixth recommendation is to implement a targeted education support system that exempts vulnerable groups from basic and secondary education fees, ensuring that an entire generation is not excluded from learning.
The seventh recommendation is to create a shared healthcare financing mechanism that guarantees access to essential services, either free or at nominal cost, for lower-income groups, recognising healthcare as a right rather than a commodity governed solely by purchasing power.
The eighth recommendation is linking any increases in education or healthcare fees to measurable improvements in service quality and beneficiary satisfaction.
The ninth recommendation is to launch healthcare and education voucher programmes, financed through a national solidarity fund, to target the most vulnerable groups accurately.
The tenth recommendation is to prohibit arbitrary fees for examinations and certificates through a unified federal law, recognising education as a right that should not be subject to inconsistent local interpretations.
In transport and logistics, the eleventh recommendation is to unify national road charges under a single authority and reframe them as service fees directly linked to road maintenance, enabling citizens and traders alike to see a visible return on what they pay.
The twelfth recommendation is linking transport charges to measurable criteria such as distance, load, and service quality, while abolishing arbitrary multiple checkpoints.
The thirteenth recommendation is establishing a unified electronic payment system for transport fees to reduce friction and curb corruption.
The fourteenth recommendation is to exempt agricultural and industrial production inputs from transport fees to reduce production costs and improve local competitiveness.
The fifteenth recommendation is to create “green logistics corridors” for strategic commodities at preferential rates to ensure the uninterrupted movement of essential goods.
Regarding municipal levies and local governance, the sixteenth recommendation is issuing a unified law regulating municipal charges, preventing duplication, and clearly defining permissible fees.
The seventeenth recommendation is to link municipal revenues to measurable services, such as sanitation, lighting, and market maintenance, so that citizens see direct benefits.
The eighteenth recommendation is to establish local transparency platforms that publish all municipal revenues and expenditures.
The nineteenth recommendation is empowering local legislative councils to review and approve any new charges following proper impact assessments.
The twentieth recommendation is to reward municipalities that increase revenues through local economic growth rather than by raising fees.
On governance, transparency, and accountability, the twenty-first recommendation requires every government body to publish its fees, calculation methods, and economic and social impact assessments.
The twenty-second recommendation is to establish an independent unit within the Ministry of Finance dedicated to evaluating regulatory and fiscal impacts, serving as a technical safeguard against arbitrary decisions.
The twenty-third recommendation is activating electronic complaint and appeals systems for unlawful charges.
The twenty-fourth recommendation is involving employers’ federations and chambers of commerce in annual reviews of fiscal policy.
The twenty-fifth recommendation is linking the performance evaluation of public officials to citizens’ satisfaction with services provided in exchange for fees paid.
In the sphere of digital transformation and rationalised collection, the twenty-sixth recommendation is to generalise electronic payment systems for all government fees and to abolish direct cash collection, recognising cash as a breeding ground for corruption.
The twenty-seventh recommendation is creating a unified national database for citizens and economic activities to eliminate duplication.
The twenty-eighth recommendation is using artificial intelligence to analyse collection patterns and detect leakage and corruption.
The twenty-ninth recommendation is to launch a unified application that enables citizens and businesses to identify all fees owed transparently.
The thirtieth recommendation is creating an automated refund system for fees paid in error within a specified short timeframe.
Regarding incentives and investment alternatives, the thirty-first recommendation is providing tax incentives for companies that reinvest profits into productive expansion and local employment.
The thirty-second recommendation is to establish special economic zones with simplified, unified taxation structures to attract investment in strategic industries.
The thirty-third recommendation is launching public-private partnerships for service delivery under transparent, time-limited fee structures.
The thirty-fourth and final recommendation is directing part of the revenues from natural resources into a sovereign fund that reinvests in productive infrastructure rather than current expenditure, ensuring that national wealth becomes productive assets for future generations.
This package cannot succeed without a clear political will that places economic sovereignty above short-term calculations. Success requires continuous impact assessment, ongoing review, and a willingness to adjust course when evidence shows policies are failing. It also requires a new public discourse that redefines the role of the state: not as a fee collector, but as a regulator, facilitator, and enabler of production.
Sudan today stands at a crossroads. One path is continued reliance on expanded extraction and levies — a road that leads to more inflation, fragility, declining trust, and ultimately chronic economic contraction. The other path is the transition towards an economy of production and sovereignty — a more difficult road in the short term, but the only one capable of delivering sustainable growth, social justice, and institutional stability.
The field evidence before us asks only that we listen to the voice of reality and translate it into coherent economic policy centred on the productive citizen.
The central message is simple yet decisive: real revenue does not come from direct deductions from citizens’ pockets. It comes from a factory operating at full capacity, from a farm that produces and exports, from a university graduating competitive professionals, and from a hospital restoring workers to productive life. Any other form of revenue merely postpones its true cost — a cost that will later emerge as slower growth, brain drain, and social fragmentation.
If Sudan wishes to write a new chapter in its economic history, it must begin by redefining the relationship between state and citizen — transforming it from one of extraction into one of production partnership. Only then will fees cease to be burdens and instead become legitimate payments for genuine services; only then will they cease to be sources of social tension and instead become instruments of economic empowerment.
This is the battle for economic sovereignty in the twenty-first century — a battle won not through slogans, but through difficult decisions, coherent policies, and wise governance that places the productive citizen at the centre of the equation.

Shortlink: https://sudanhorizon.com/?p=14200