Fiscal Policy and Sudan’s 2005 Comprehensive Peace Agreement

Abstract

Sudan’s 2005 Comprehensive Peace Agreement (CPA) came at a time when oil revenues had transformed Sudan’s economy, and it recognized that regional inequalities in development needed to be redressed for peace to be sustainable. The government used fiscal policy to address these inequalities, transferring significant amounts of the central government’s oil rents to state governments. It was mostly spent on wages for government officials, and the evidence reviewed here suggests that it did little to redress Sudan’s stark regional inequalities. This chapter argues that the CPA’s fiscal arrangements alone could not address the land crises that underlie the violence and stagnation in the Sudan’s deeply polarized peripheral states: that would require ambitious plans to draw the productive energies of the periphery into the national economy, centred on Khartoum.