February 12, 2020 / 6:20 PM / 7 days ago

Sudan to continue to subsidize bread but with 'justice': trade minister

KHARTOUM (Reuters) - Sudan will continue to subsidize bread prices during transitional rule after Omar al-Bashir’s ouster but wants to achieve “justice” in distributing income supports, its trade and industry minister said on Wednesday.

FILE PHOTO - Sudanese men bake breads in Khartoum, Sudan, June 19, 2019. REUTERS/Umit Bektas

Bread shortages, caused by difficulties in raising hard currency to import wheat, triggered mass protests which - with the help of the military - toppled the veteran autocrat last April after three decades in power.

The new civilian government, ruling together with the armed forces for three years and three months, has been trying to address bread and fuel shortages that have led to lengthy queues outside bakeries and petrol stations.

The bread queues are caused at least in part by problems in ensuring supplies of subsidized flour to bakeries.

Trade and Industry Minister Madani Abbas Madani told reporters Sudan had sufficient wheat reserves until May and was in talks for deals to ensure enough stocks until year-end.

“The state is committed to subsidizing bread during the transition period, but aims to ensure justice in distributing the subsidies,” Madani said.

He added that within 45 days the government would also launch commercial bakeries which will sell non-subsidized bread drawing on commercial stocks.

He said the Khartoum government ultimately aimed to shift from subsidizing wheat to subsidizing bread, but that this required “infrastructure arrangements”.

That could allow bakeries to sell bread for more than the current fixed price of one Sudanese pound per loaf (2 U.S. cents at the official rate, or 1 U.S. cent on the parallel market) which has made it hard for bakeries to make money.

During the recent bread crisis, “resistance committees” have kept watch at bakeries to monitor supplies and crack down on what they say is corruption and leakages of subsidized flour.

From next week an electronic monitoring system will be introduced to track supplies and a hotline established for people to report malpractices, Madani said.

He said a newly formed police unit would be deployed to monitor flour and bread trade, alongside the resistance committees.

It was not immediately clear whether the new commercial bakeries would ease the burden on a government budget that is also subsidizing fuel and other basic products in the widely impoverished country. Sudan currently spends about $65,000 per day on wheat, according to the trade ministry.

Sudan lost about 75% of its oil wealth, a major hard-currency source, when South Sudan declared independence in 2011.

Officials said on Wednesday that a problem with a refinery pipeline that was the main cause of fuel shortages over the past week had been fixed.

Additional reporting by Nafisa Eltahir; Writing by Ulf Laessing and Aidan Lewis; Editing by Mark Heinrich

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