UAE consortium to construct a US$4bn port in Sudan

A consortium of two Abu Dhabi-based firms have partnered with Sudanese dairy magnet Osama Daoud Abdellatif, whose DAL Group has become Sudan’s biggest conglomerate, to build a US$4bn port complex that will include a free trade industrial zone and will be connected to a 160,000 hectare site along the Nile river to farm and process alfalfa, wheat, cotton, sesame and other crops. Critics, however, say the new port, which is to be built with the assistance of Abu Dhabi Ports (ADP), will make Port Sudan redundant and will put thousands of port workers out of job. ADP has denied entering into any joint venture with DAL, but confirmed that it was involved in “preliminary” talks. The announcement of the two investment projects come as Sudan’s economy continues to suffer the consequences of high inflation, currency collapse, ethic tensions, and recurring protests against the military junta led by President Abdel Fattah El-Burhan. Sudan saw consumer price inflation rise by 192% in May - one of the highest in the world. The Sudanese Pound, which hovers around US$0.0021, remains under stress. The country is also grappling with rising prices of basic goods, and is running low on foreign reserves.

Abdellatif told Reuters that his firm has joined hands with Abu Dhabi-based International Holding Company (IHC) to develop the agricultural project, which is located in Abu Hamad, a city nearly 420 kms north of capital Khartoum. The plan is to connect the new port with this agriculture site with a 500 kms road. He claimed that a US$300m deposit would be made to the Sudan central bank for the project which is in its “advanced stages” with studies and designs complete.

Investments in port and agricultural projects, however, could be undermined by popular dissent. The ruling military junta which has been facing mounting street protests ever since it thwarted the country’s transition to democracy in October 2021. Port Sudan itself is a hot bed of unrest with workers opposing any attempts to privatise it fearing loss of jobs.

The country, however, needs a fresh injection of capital to sustain its green shoot economic recovery. The GDP grew by an estimated 0.5% in 2021 on the back of agricultural output and mining. 

 

References

‘EXCLUSIVE UAE to build Red Sea port in Sudan in $6 billion investment package’, Reuters, 21 June 2022

‘Sudan: UAE to partner with DAL Group to build new port’, The Africa Report, 21 June 2022

‘Sudan’s military leader turns to UAE to shore up authority’, Al-Monitor, 21 March 2022

‘Who we are’, ADQ, 2020

‘Sudan police crack down on hundreds of anti-coup protesters’, Middle East Eye, 17 July 2022

‘Sudan's annual inflation drops to 192.21% in May’, Reuters, 13 June 2022

‘Central bank liberalizes Sudanese pound’, Sudan Tribune, 07 March 2022

‘No deal signed yet to build Red Sea port in Sudan – Abu Dhabi Ports’, Zawya, 21 June 2022

https://www.afdb.org/en/countries/east-africa/sudan/sudan-economic-outlook

https://ihsmarkit.com/research-analysis/the-impact-of-civil-unrest-on-port-sudan.html