Amid unrest, Sudan’s bourse maps out expansion plans

Women work at the Khartoum Stock Exchange in Khartoum, Sudan. (File/Reuters)
Updated 13 November 2019

Amid unrest, Sudan’s bourse maps out expansion plans

  • Though still tiny, Sudan's trade volumes have risen steadily in local currency terms in recent years
  • Most trade in is a type of sukuk, or Islamic bonds, known as shahamas

KHARTOUM: In the small basement of a two-story building next to Khartoum’s central bus station, around 40 smartly dressed men and women gather around terminals for an hour a day with one eye on the future of Sudan’s fledgling financial market.
The stock exchange they work at managed to avoid a crash during the unrest that convulsed the country this year, toppling long-time ruler Omar Al-Bashir.
And now it has ambitions to expand once the government has stabilized an economy in crisis and ended the country’s isolation.
“With the changes that happened in Sudan we expect there will be big interest from non-Sudanese investors,” said the exchange’s assistant director Abdelrahman Majeed.
Though still tiny with a market capitalization of around 8 billion pounds at the end of 2018, its trade volumes have risen steadily in local currency terms in recent years. They increased to some 11 billion pounds ($245 million) this year from 9 billion for all of 2018, said Majeed.
It has also upgraded technology with Oman’s help and hopes to connect all brokers online soon, he said. Currently only one brokerage can trade real-time online, traders say.
Most trade in is a type of sukuk, or Islamic bonds, known as shahamas. On the three days that Reuters visited the bourse, few of the 68 stocks moved.
Some foreigners, notably from the Gulf, have bought into the market but many have struggled to repatriate their investments since the 2011 secession of South Sudan, which took away most of Sudan’s oil wealth and caused hard currency shortages, dealers say.
The civilian government appointed in April plans to set up investment body to review investment regulations, Finance Minister Ibrahim Elbadawi told Reuters.




Women walk out of the Khartoum Stock Exchange in Khartoum, Sudan. (File/Reuters)

This will encourage higher volumes once economic reforms have been enacted and inflation brought down, he said, adding that the government hoped the United States would remove Sudan from its list of state sponsors of terrorism.
DIVERSIFICATION
For Dima Awad, General Manager at Sudan’s biggest brokerage Sanabel Securities, the market also needs to offer a greater range of tradeable products, given many foreign investors are not interested in sukuk.
“We need to develop ...first the infrastructure (and) secondly we need new products,” she said.
.”..We need the government to give more support... have a vision, on what technologies we need, how can we connect to Gulf markets.”
Her brokerage is part Bank of Khartoum, the biggest local bank whose owners include several Gulf lenders.
Meanwhile authorities expect to issue 4 billion Sudanese pounds ($89 million) of sukuk this year. They are the main investment tool for banks and the public and offer a chunky annual profit rate of between 17 and 20%.
Osama Elnour Saeed, an official at the Sudan Financial Services Co. which issues sukuk on behalf of the government, said the last issue was oversubscribed as some investors were betting USsanctions would be lifted.
But a financial source said banks had invested excess liquidity after the central bank printed more money to address a cash crisis.
($1 = 44.9952 Sudanese pounds)


Saudi Arabia’s Red Sea mega project awards contracts for international airport

Updated 13 July 2020

Saudi Arabia’s Red Sea mega project awards contracts for international airport

  • Saudi Arabia plans to develop resorts on 50 islands off the Red Sea coast, offering a nature reserve, coral reef diving and heritage sites
  • Red Sea Development Co, backed by Saudi Arabia’s sovereign fund, the Public Investment Fund (PIF), plans to build the first phase by 2022

RIYADH: Saudi Arabia’s Red Sea Development Company said on Monday it had awarded infrastructure contracts for an international airport that is due to open in 2022.
The company, which is developing a huge Red Sea tourism project, said the contracts were awarded to Nesma & Partners Contracting Co. Ltd. and Almabani General Contractors.
Saudi Arabia plans to develop resorts on 50 islands off the Red Sea coast, offering a nature reserve, coral reef diving and heritage sites.
Red Sea Development Co, backed by Saudi Arabia’s sovereign fund, the Public Investment Fund (PIF), plans to build the first phase by 2022. It aims to attract 300,000 tourists a year in the first phase and 800,000 to 1 million once the development is complete.
Red Sea is one of three major projects backed by PIF, along with the $500 billion NEOM economic zone and the Qiddiya entertainment project.
Saudi Arabia’s NEOM, which is building a $500 billion mega economic zone, said last week it had signed an agreement with Air Products and Saudi Arabia’s ACWA Power for a $5 billion green hydrogen-based ammonia production facility.