The Impacts of Foreign Currency Exchange Rates on Savings in Sudan

Abstract

The impacts of fluctuations of exchange rates of foreign hard currencies are well documented in economics literature. There are measures taken over by countries to absorb their impacts on income, employment and national economies ability to function and produce. However, distortions are observed in underdeveloped and developing countries. Sudan is among those where impacts of fluctuations in exchange rates versus national currencies are strongly observed and felt on its economy. In the past three decades they represented the highest effects on real money's value, had macroeconomic impacts, affect the prices of productive inputs, produced commodities and the economy's performance. The examination we follow in this paper reveals that they were zero-policies for stabilization. The bank case study for examining encouragements, promoting saving policies to support the national economy suggests they were equal to zero-policies. It is suggested here that macroeconomic restructuring is inevitable to normalize the economic performance. Otherwise, more crisis face the country, one of them is cardinal and eminent economic collapse.

Note: Downloadable document is in Arabic

Keywords: Sudan, Foreign Currency Exchange rates, Macroeconomic Policy, Savings, Inflation, Poverty

JEL Classification: B20, B21, B22, E00, E6, E31, E39, E60, E61, E62, E63, E64, E65, E66, E69, P24