Currency devaluation in Sudan boosts trade balance and export demand.
Currency devaluation can help Sudan improve its trade balance. By studying the effects of devaluation on trade balance and export prices, researchers found that devaluation could be a useful policy to improve the balance of payments. The study showed that the demand for exports like cotton and gum arabic is sensitive to exchange rates and foreign prices. Devaluation of the Sudanese pound may increase the demand for cotton in the long run, but have little impact on gum arabic exports. Overall, devaluation could lead to a better trade balance for Sudan in the long term.