Skip to main content

Sudan conflict poses credit risk to economies in region: Moody’s

The credit agency warned that the fighting had shut down the Sudanese economy and could leave multilateral development banks exposed.
The local government headquarters of Sudan's Red Sea State is pictured in Port Sudan on April 18, 2023. (Photo by AFP) (Photo by -/AFP via Getty Images)

The potential of a protracted conflict in Sudan has brought the country’s fragile economy to a “halt,” but it also poses a credit risk to neighboring states and multilateral development banks with high loan exposure to the African country, Moody’s Investors Service warned on Monday.

The power struggle between the Sudanese military and the influential paramilitary group the Rapid Defence Forces (RDF) turned deadly April 15-16, with the capital, Khartoum, being the flashpoint of the conflict. 

Foreign embassies have closed and are evacuating their nationals as the country threatens to spiral into a full-blown civil war. More than 420 people, including 264 civilians, have been killed and over 3,700 have been injured in the fighting, according to The Associated Press. The conflict has derailed an internationally backed plan for a transition to civilian rule after the 2019 ousting of long-time dictator Omar al-Bashir. 

The New York-based ratings agency was quick to warn of the economic consequences of the violence on Monday. "If the conflict descends into a prolonged civil war, destruction of social and physical infrastructure would have lasting economic consequences, weighing on MDB (multilateral development bank) asset quality in Sudan, along with overall nonperforming loans (NPLs) and liquidity,” Moody’s said in a note.

Access the Middle East news and analysis you can trust

Join our community of Middle East readers to experience all of Al-Monitor, including 24/7 news, analyses, memos, reports and newsletters.


Only $100 per year.