The Central Bank of Sudan (CBoS) yesterday announced the issuance of a new banknote of SDG1,000 as part of the bank’s efforts to modernise the currency and improve the security standards used in printing money, which contributes to combating counterfeiting and enhancing confidence in the national currency.
The Central Bank said in a press statement that it is within the framework of the bank’s responsibilities to protect the national currency, stabilise its exchange rate, and help achieve economic stability.
The CBoS further should address the negative effects of the ongoing war in the country. It laments the widespread plundering by what it calls the “rebel militia” of the headquarters of the Central Bank of Sudan and the Sudan Currency Printing Company in Khartoum. “This resulted in the spread of large quantities of banknotes of unknown origin and not conforming to technical specifications in the SDG1,000 and SDG500 denominations, which has led to a clear increase in the level of cash liquidity and a negative impact on the stability of the general price level,” the bank says.
The Central Bank confirmed that the old banknotes will remain valid, and the process of replacing them will be carried out gradually according to a timetable that will be announced later, in order to facilitate the transition process without affecting the transactions of individuals and institutions.
Commercial banks have been directed to facilitate, in accordance with the bank’s announcement, the process of opening accounts for people who do not have bank accounts, to enable them to deposit old SDG1,000 banknotes and other banknotes, to benefit from banking services, including electronic payment services.
The Arabic language obverse of the new banknote depicts Port Sudan, the grain silo, gold bullion, the number 1,000 in true Arabic numerals at the top left and bottom right, and the date of issue, June 2024. The reverse depicts an image of the CBoS headquarters, “One Thousand Sudanese Pounds” in English, and the amount in standardised Arabic numerals.
The CBoS carries a number of advanced security specifications and marks, which include a moving security strip that appears clearly when the note is tilted.
“This note carries the specifications and security marks related to the dimensions of the note at 158 by 70 mm. The basic colours of the note are shades of yellow and green… the watermark shows a full-fledged falcon,’ the announcement reads.
Current SDG1,000 note
The current SDG1,000 note was issued in June 2022 amidst rising inflation in Sudan. Until that time, SDG500 was the highest denomination in circulation.
The socioeconomic detritus of the 30-year Al Bashir dictatorship, who has also been charged for currency offences, left Sudan’s economy in ruins, with the value of the Sudanese Pound (SDG) at all-time lows against international currencies.
In its dying throes, the Al Bashir regime desperately ordered the printing of new currency denominations of SDG100, SDG200, and SDG500 by the Central Bank of Sudan in an attempt to solve the chronic public and commercial liquidity crisis.
In the years after, concerns about the rising inflation grew, strengthened by Sudan’s importing of most basic needs, the budget deficit, and the dramatic increase in salaries financed through the printing of banknotes, which led to a further devaluation of the Pound.
Recently, the Sudanese Pound plunged even further, and the US Dollar traded for SDG550 on the parallel forex market. United Nations reports indicate that the value of the local currency has decreased 20 times (2,000 per cent) during the past five years.
Liquidity crisis
Since the start of the current hostilities in 2023, Sudan has suffered a severe cash shortage, with ordinary people feeling the pinch of the liquidity crisis. Observers attribute these issues to the suspension of banking services in areas controlled by the RSF. In contrast, areas under the control of the Sudanese Armed Forces, including the administrative capital Port Sudan, are experiencing relatively better financial conditions due to more stable banking operations services.
While the Central bank of Sudan quotes a middle rate of SDG448.73 against the US Dollar, and respected international currency conversion site xe.com consistently quotes SDG598.91 against the greenback, the effective exchange rate on the parallel market – up to four times the official rate – can fluctuate quickly and change daily.
Before the war, the US Dollar exchange rate in the parallel market stood at SDG60. Over the past months, the Sudanese Pound’s value has plummeted by more than 350 per cent, leading to soaring prices for commodities, especially fuel.
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Source: dabangasudan
