Sudan - Foreign investment

In 1971, Sudan nationalized the holdings of foreign investors, mostly British. A privatization effort and a move toward a mixed economy began slowly in the early 1980s and picked up momentum via negotiations with the IMF in 1985. The 1980 Encouragement of Investment Act provided for repatriation of profits, tax incentives, customs relief, industrial rates for transport and electricity. However, the introduction of Shari 'a law in 1983 (unenforced since 1985), along with foreign exchange shortages, discouraged investors through 1986. In 1990, the government invited foreign investors to purchase companies in the parastatal sector. Key properties in the agricultural, tourist, transportation and communications sectors were identified as candidates for privatization under the National Economic Salvation Program. In 1992, the creation of four free-trade zones was announced in an attempt to encourage additional foreign investment.

In 1999, a new investment act guaranteed the equal status of foreign and national projects; and encouraged investment in the sectors of agriculture, industry, and tourism, amongst others. It gave total tax exemptions for business profits and customs duties for 10 years on capital projects, and 5 years for nonstrategic industries. Foreign investment in 2000 included inflows from Canadian and Araki oil interests, as well as European investment.

Annual foreign direct investment (FDI) inflows were $98 billion in 1997, but rose to an average of $378 million 1998 to 2000. In 2001, FDI inflow increased to a record $574 million.

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