Sudan receives $1.5 billion loan from China Development Bank
January 18, 2013 - 12:00:00 am
KHARTOUM: Sudan has won a $1.5 billion loan from the state-run China Development Bank, which Khartoum hopes will ease the country's severe economic crisis.
China has been investing aggressively in Africa to secure resources such as oil, gold or farmland, and it has an interest in stabilising Sudan's economy because oil exports from arch rival South Sudan need to pass through the north.
The loan was announced through the official news agency SUNA on Thursday. Finance Minister Ali Mahmoud last week said that Sudan had won a $1.5 billion loan but did not name the bank.
Sudan has been unable to stop a slide in its currency since losing three quarters of its oil production when South Sudan seceded in 2011. That currency slide has fuelled inflation, small protests.
Oil revenues were the main revenue source for the budget and also for dollars needed to buy basic food imports such as wheat and sugar. Sudan produces too little to feed its population of 32 million.
Sudan will have to repay the loan only after a grace period of five years, SUNA reported.
China is Sudan's biggest trading partner behind Gulf Arab oil producers and is the largest investor in the oil industry in both Sudan and South Sudan.
The neighbouring African countries agreed in September to resume oil flows after Juba shut down its exports a year ago in a row over pipeline fees. But both have to agree on how to secure their disputed border before exports will resume. (Reuters)