Sudan : Welfare Impacts of Recent Food Price Hikes, November 2017–July 2018

With the end of the oil economy in 2011, Sudan’s regime of subsidies for wheat and fuel became increasingly unsustainable. The loss of oil revenues in the wake of the secession of South Sudan in 2011 resulted in severe macroeconomic imbalances, inc...

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Main Author: Lange, Simon
Format: Policy Note
Language:English
Published: World Bank, Washington, DC 2021
Subjects:
Online Access:http://documents.worldbank.org/curated/en/797841628491511658/Sudan-Welfare-Impacts-of-Recent-Food-Price-Hikes-November-2017-July-2018
http://hdl.handle.net/10986/36098
id okr-10986-36098
recordtype oai_dc
spelling okr-10986-360982021-08-12T05:10:36Z Sudan : Welfare Impacts of Recent Food Price Hikes, November 2017–July 2018 Lange, Simon FOOD PRICES POVERTY CONSUMPTION WHEAT SUBSIDIES WELFARE IMPACT With the end of the oil economy in 2011, Sudan’s regime of subsidies for wheat and fuel became increasingly unsustainable. The loss of oil revenues in the wake of the secession of South Sudan in 2011 resulted in severe macroeconomic imbalances, including a substantial budget deficit, pressure on the exchange rate, increases in the inflation rate, and the emergence of a system of multiple exchange rates. Despite an increase in the fiscal cost of these subsidies due to downward pressure on the Sudanese Pound (SDG) and except for incremental price hikes for electricity and fuel, both wheat and fuel subsidies remained largely in place until the end of last year. This policy note aims to estimate the level and incidence of welfare effects of increasing staple food prices between October 2017 and July 2018. Combining household-level data from the first round of the National Household Budget and Poverty Survey 2014/15 and monthly wholesale prices collected in up to six major markets throughout the country, this note evaluates the distributional effects of recent price hikes. Future subsidy reforms should pay close attention to typical food price fluctuations over the year: ideally, reforms are implemented shortly after sowing and before the main harvest season. Food prices typically fluctuate substantially in Sudan over the course of the year. Fuel subsidy reforms should be timed to take advantage of this pattern, which would most likely mean that they should be initiated directly after the sowing season and before the beginning of the harvest season so that prices remain stable at this point. 2021-08-11T14:50:11Z 2021-08-11T14:50:11Z 2018-09 Policy Note http://documents.worldbank.org/curated/en/797841628491511658/Sudan-Welfare-Impacts-of-Recent-Food-Price-Hikes-November-2017-July-2018 http://hdl.handle.net/10986/36098 English CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Economic & Sector Work Economic & Sector Work :: Policy Note Africa Africa Eastern and Southern (AFE) Sudan
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
topic FOOD PRICES
POVERTY
CONSUMPTION
WHEAT SUBSIDIES
WELFARE IMPACT
spellingShingle FOOD PRICES
POVERTY
CONSUMPTION
WHEAT SUBSIDIES
WELFARE IMPACT
Lange, Simon
Sudan : Welfare Impacts of Recent Food Price Hikes, November 2017–July 2018
geographic_facet Africa
Africa Eastern and Southern (AFE)
Sudan
description With the end of the oil economy in 2011, Sudan’s regime of subsidies for wheat and fuel became increasingly unsustainable. The loss of oil revenues in the wake of the secession of South Sudan in 2011 resulted in severe macroeconomic imbalances, including a substantial budget deficit, pressure on the exchange rate, increases in the inflation rate, and the emergence of a system of multiple exchange rates. Despite an increase in the fiscal cost of these subsidies due to downward pressure on the Sudanese Pound (SDG) and except for incremental price hikes for electricity and fuel, both wheat and fuel subsidies remained largely in place until the end of last year. This policy note aims to estimate the level and incidence of welfare effects of increasing staple food prices between October 2017 and July 2018. Combining household-level data from the first round of the National Household Budget and Poverty Survey 2014/15 and monthly wholesale prices collected in up to six major markets throughout the country, this note evaluates the distributional effects of recent price hikes. Future subsidy reforms should pay close attention to typical food price fluctuations over the year: ideally, reforms are implemented shortly after sowing and before the main harvest season. Food prices typically fluctuate substantially in Sudan over the course of the year. Fuel subsidy reforms should be timed to take advantage of this pattern, which would most likely mean that they should be initiated directly after the sowing season and before the beginning of the harvest season so that prices remain stable at this point.
format Policy Note
author Lange, Simon
author_facet Lange, Simon
author_sort Lange, Simon
title Sudan : Welfare Impacts of Recent Food Price Hikes, November 2017–July 2018
title_short Sudan : Welfare Impacts of Recent Food Price Hikes, November 2017–July 2018
title_full Sudan : Welfare Impacts of Recent Food Price Hikes, November 2017–July 2018
title_fullStr Sudan : Welfare Impacts of Recent Food Price Hikes, November 2017–July 2018
title_full_unstemmed Sudan : Welfare Impacts of Recent Food Price Hikes, November 2017–July 2018
title_sort sudan : welfare impacts of recent food price hikes, november 2017–july 2018
publisher World Bank, Washington, DC
publishDate 2021
url http://documents.worldbank.org/curated/en/797841628491511658/Sudan-Welfare-Impacts-of-Recent-Food-Price-Hikes-November-2017-July-2018
http://hdl.handle.net/10986/36098
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