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Increase in cost of production plagues Sudan's factories

A picture shows freshly-minted notes of the new South Sudan pound, which pictures the late South Sudanese independence leader John Garang, in Juba on July 18, 2011. AFP PHOTO/STR (Photo by - / AFP) (Photo by -/AFP via Getty Images)
A picture shows freshly-minted notes of the new South Sudan pound, which pictures the late South Sudanese independence leader John Garang, in Juba on July 18, 2011 [ -/AFP via Getty Images]

The industrial sector, like other productive sectors in Sudan, suffers from many problems that have led to the closure of many factories and the displacement of thousands of workers. Among the obstacles facing the sector are the scarcity of energy and its high prices, especially electricity, and the devaluation of the pound against the dollar.

The Sudanese Chamber of Industries Association (SCIA) announced in a recent statement that 5,940 factories ceased operations, out of a total of 7,350. The SCIA attributed the cessation of industrial activities to high production costs as well as an increase in service and customs fees, and the lack of foreign currency.

Specialists attributed the reasons for the sector's decline to problems caused by the government itself, including decisions to increase customs fees.

A source at the Ministry of Industry, who preferred to remain anonymous, told Al-Araby Al-Jadeed that there are some problems facing the industrial sector, such as energy and roads issues. He stressed the Ministry's intention to build 4 integrated industrial zones in one city.

He said the reason for the recent rise in the prices of industrial products is the increase in production costs, saying that the value of some inputs has multiplied tenfold. He affirmed the Ministry's possession of integrated policies, which he described as supporting the development of the industrial sector.

On the other hand, factory owner, Ishaq Adam, told Al-Araby Al-Jadeed that imposing large fees on industries contributed to raising the cost of production and added more dimensions and aspects for producers and consumers, stressing that the main issues suffered by the sector are the difficulty of obtaining foreign currency to purchase raw materials, and the weakness of the electricity supply in industrial areas, which made many facilities rely on generators, thus increasing the production cost.

The source also acknowledged the difficulty of competing with the imported counterpart, as it is unfair competition to the national products, given the fact that they receive the support of their countries and enter at low prices.

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