Accra and Khartoum plan for oil unpredictability
In Accra, the announcement of first oil in December 2010 was accompanied by the rush to spend the proceeds as quickly as possible.
A local thinktank, the IMANI Centre for Policy and Education, has warned that predicted production levels – and therefore the revenue the government receives – are much too high.
‘Generally, the results from Jubilee mirror the performance of other offshore projects in West Africa, for instance in Côte d’Ivoire and Cameroon, where optimistic timelines and production levels have failed to materialise over the long term,’ it said in an alert released on 11 July.
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The dangers of reliance on wavering commodity prices is an age-old problem for Africa’s non-diversified economies.
In Sudan, the damage has been done not by markets or over-optimistic forecasting, but by an assumption that South Sudan would not turn off the oil taps because of a dispute over transit fees.
Khartoum’s budget deficit is now more than $2.4bn. New austerity measures, such as cutting fuel subsidies, have provoked a political backlash, bringing the country to the brink of its own ‘Arab Spring’.
Policy makers hope that a recent thaw in relations will once again mean that the tankers off Port Sudan will be fully loaded●