Keeping eyes on Sudan – keeping eyes on austerity

Cheap borrowing is over and austerity is back. The 2023 International Monetary Fund (IMF) regional report on Africa argues that the continent is at a turning point: a phase of a constant increase in African borrowing on global capital markets, lasting from 2007 to 2022, has come to an end. This saw an increase in the stock of African Eurobonds, which in December 2021 were estimated at US$140 billion (Smith 2021), but rampant global inflation and the increase of borrowing costs put an end to this phase. The issuing of new Eurobonds in Africa declined from US$14 billion in the second quarter of 2021 to US$6 billion in the first quarter of 2022, while the US dollar effective exchange rate reached a 20-year high (IMF 2023). This has once more reinforced the US dollar – under the rising challenge posed by the internationalisation of the Chinese yuan and its recent digitisation (Deng 2023) – as world money, sitting firmly at the top of the global money hierarchy. African countries, like many others in the global South, are once more entrenched low down in the hierarchy of the global monetary system. This dynamic brings to light the ‘remarkable historical continuity of capitalist finance as a key vector of imperialism’ (Alami 2019, 2), while African governments are pushed towards the re-enactment of austerity policies. Since spring 2022, African governments have stopped issuing Eurobonds (IMF 2023) and now, halfway into 2023, eyes are on which African government is going to default next, following on the default of Zambia in 2020 and Ghana in 2022. A new phase of austerity politics highlights the persisting burden of imperialism, while African states grapple with all the features of centuries of historical layering of uneven and combined development (Ashman 2009). Our editorial in issue 174 argued that the global economic slowdown has led to the return of Structural Adjustment Programmes (SAPs) to the continent, because of the increased rates of indebtedness of most African countries promoted by low interest rates in the first decade of the 2000s. As referenced in that editorial, ROAPE documented the emergence of this dynamic the first time round, in the 1980s, and the role of international financial institutions in enforcing SAPs’ austerity policies, alongside the politics of negotiations, resistance or compliance that these generated at the national level in different countries. As argued by Alami (2018), there is a set of features that can be identified in most emerging or industrialising economies that goes beyond the simple subordination of weaker currencies to stronger currencies on global monetary markets. These features are to be found in most African countries: a persistently strong scrutiny by international investors over national policy processes, high volatility of exchange rates and high interest rates, fragile financial reputations that are easily shaken and rapidly changing, coupled with equally rapid capital flight during moments of financial crisis, and a general dependence on the monetary policies of advanced capitalist countries. All these features lead to a ‘severity of the terrorism of money’ (Alami 2018, 28) that characterises poor, non-industrialised countries. Capital’s hold on material reality has a strong – though not unshakeable – hold over people’s imagination and perception of reality. One of the mechanisms through which this