Port Sudan's location on the Red Sea could make it a key shipping point for products headed toward the Mediterranean in one direction and the resource-hungry Gulf Arab states in the other.
Port Sudan's location on the Red Sea could make it a key shipping point for products headed toward the Mediterranean in one direction and the resource-hungry Gulf Arab states in the other. | Wikimedia

Sudan Reopens For U.S. Businesses

After decades of Chinese and Arab investment, Sudan is once again open for U.S. businesses, government officials told a gathering of reporters at the National Press Club in Washington D.C. Thursday.

Many of the U.S. government sanctions were lifted in the closing days of the Obama Administration, opening the door to American investors for the first time in more than 25 years.

“If we could find investment from the U.S. that would be the best possible source of investment in our country,” said Ibrahim Ahmad Omar, speaker of the parliament. Sudan hopes to pivot away from Chinese technology to that of world-leading American and European companies.

The Trump administration had not commented on Obama's end-of-term decision to end most sanctions on Sudan. Some sanctions remain and the U.S. State department continues to list Sudan as a state sponsor of terrorism, a designation which imposes other economic limits on Sudan.

Echoing President Obama's remarks, Omar attributed that decision to the ongoing peace process that has dramatically reduced tensions in his country of 40 million, mostly Arabic-speaking residents.

Sudan's civil war, which had raged since 1983, officially ended in 2006. “Given our ongoing reconciliation process, Sudan is the most stable country in the region compared to South Sudan and the Central African Republic,” Omar said, mentioning two of Sudan's neighbors which among the poorest and most violent on Earth.

The largely Christian south voted overwhelmingly for independence in 2012, which was immediately agreed to by Khartoum. So Africa's largest nation divided into two, Sudan and South Sudan. While South Sudan received almost three-quarters of oil reserves and a tremendous amount of U.S. and European aid, it soon devolved into a war pitting tribe against tribe, Christian against Christian. As war parties crisscrossed the new nation, oil production all but ceased. Farms were ravaged and flocks scattered. This past month, the United Nations declared that South Sudan was officially suffering from famine.

Meanwhile, the former northern half of Sudan enjoyed a durable peace for the first time since its independence from Britain in 1956. Yet prosperity did not follow, as the sanctions, imposed during the war with the south and human-rights crisis in Darfur, lingered. As Sudan endured decades of Western sanctions, its government and businesses turned to Chinese, Indonesian and Arab firms and investors. The Chinese, especially, hold commanding shares in Sudan's oil and telecommunications sectors. Without spare parts for its Western-made machines, Sudan's aircraft were grounded and railways slowed. Now, with sanctions easing, these troubles are presented as opportunities for foreign investors.

In making the pitch for foreign investment, the speaker of the Parliament highlighted two strengths: Sudan's strategic location on the Red Sea which, he said, makes it an ideal shipping point for products headed toward the Mediterranean in one direction and the resource-hungry Gulf Arab states in the other. Second, is Sudan's domestic economy, where demand outpaces local production, creating an opening for foreign direct investments. In addition to its oil industry, Omar cited his nation's production of cotton, sesame, gum Arabic and sugar. Sudan is the world's largest producer of gum Arabic, a key ingredient in Coca-Cola and other soft drinks.

Sudan is also one of the Africa's largest producers of sugar, coming in just behind Egypt and South Africa. The crop, often called “White Gold,” faces growing demand both in Sudan and on the Arabian Peninsula. Sudan also produces actual gold, some 40 tons per year are exported through Port Sudan.

Sudanese President Omar al-Bashir focused on sugar during remarks at the 3rd Arab Conference for Agricultural Investment held in Khartoum on Monday. He noted that Sudan hopes to use date production to produce 22 million tons of sugar in the coming years, an amount which would help meet an annual shortfall of 11 million tons with the Arab world.

Business interest in Sudan has already begun to percolate in the six weeks since sanctions were softened. One of the first companies to jump into the fray is the East Africa Assistance Corporation (EAFAC), the newly formed company sees opportunities to bring American management and investors to the Sudan.

James Bothwell, senior vice president for EAFAC, said his company is trying to lay the foundation for opportunity. Part of this effort involves bringing modern American management techniques to the long-isolated country. “Sudan’s greatest asset is its people," Bothwell said. "It’s a country that is changing rapidly, and we see great opportunities and need for assistance and expertise.”

Bothwell said his company is also working to expand the business links between the two countries, including an effort "to establish the first direct commercial air links between the Sudanese capital of Khartoum and Washington D.C."

EAFAC's President is John Shoreman, who is also chief counsel for the American Media Institute.

The company sees Sudan as a country with immense agricultural potential, where there is a serious need for investment infrastructure. There are also opportunities in natural resource extraction and manufacturing. The Sudanese have made immense strides in manufacturing.

“On my last trip to Sudan, I went to see the pyramids north of Khartoum," Bothwell said. "I was struck by the fact that the Bedouins there were using satellite dishes and the Internet to try and attract more foreign business. This is a country hungry for greater involvement in the global economy.”