From 1999 to 2011 Sudan had a periodwhere it benefited from extensive discoveries of naturalwealth through oil. But the oil economy had also clearsymptoms of Dutch disease. Agriculture suffered fromneglect, and there were urgent calls to invest naturalresource rents into economic diversification efforts. Reliefto Sudan’s external debt crisis will be critical. Thecountry economic memorandum (CEM) starts out with a seriesof simulations and a review of recent key literature ongrowth and diversification with the aim of defining asuitable approach for growth and diversification for Sudan.The sectoral structure of Sudan’s economy shows the growingimportance of agriculture, less importance of extractives,and relative stability of other sectors (manufacturing,services) by 2030. Looking at other economies that weresuccessful in their diversification efforts shows that theywere able to broaden their endowments base by maximizing atriad of institutions to deliver services that ultimatelyincrease productivity. The CEM finds that there is a casefor Sudan to approach growth through diversification fromtwo angles: the production and the endowment base, both ofwhich rely on the effective utilization of key institutions.This analysis therefore uses a sectoral focus and looks atagriculture as sources for diversification, but also makesthe case that trading of goods and services - especially ofthe higher value-added kind - can be a means to grow theendowment base of the country.
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