KHARTOUM, May 7 (Reuters) - Sudan’s finance minister said on Monday a dispute with South Sudan over oil transit fees has caused a 6.5 billion Sudanese pounds ($2.4 billion) gap in the country’s public finances.
Ali Mahmoud also said inflation in the first quarter of this year had risen to 21 percent compared to 12.9 percent in the same period last year.
Khartoum and Juba have been at loggerheads over oil transit fees after South Sudan gained independence last July. The conflict, which had escalated into border fighting, caused the shutdown of nearly all oil production in the region, hurting both oil-dependent economies.
“Not reaching a deal with the government of the South over transit fees and petroleum servicing has caused a gap in the public financial sector worth about 6.5 billion Sudanese pounds,” Mahmoud told lawmakers in an address on the country’s performance in the first quarter of 2012. ($1 = 2.675 Sudanese Pounds) (Writing by Yara Bayoumy; Editing by Toby Chopra)