Sudan’s war is not forgotten; it is profitable for some

Sudan's three-year civil war—far from fading from investor consciousness—has paradoxically created a shadow economy where certain business segments thrive amid devastation. While the humanitarian toll exceeds 300,000 deaths and displaces 11 million people, regional traders, logistics operators, and suppliers to armed factions have carved out lucrative niches in a fractured market where traditional commerce has collapsed.

## How does war transform business opportunity in Sudan?

The conflict has destroyed formal state institutions, banking systems, and supply chains—but created parallel markets. Cross-border traders operating from Ethiopia, South Sudan, and Egypt now control the flow of fuel, medicine, food, and ammunition into Sudan's fractured territories. Commodity smuggling networks, informal money transfer systems (hawala), and black-market currency trading generate estimated annual revenues exceeding $4 billion USD. Unlike peacetime commerce, these transactions carry minimal regulation, lower tax obligations, and reduced competition from formal enterprises that have fled.

Regional exporters—particularly from the UAE, Turkey, and East African ports—have shifted focus toward conflict-adjacent supply chains. Turkish grain traders selling into northern states, Emirati logistics firms managing humanitarian corridors, and Kenyan transport operators moving goods via Kassala have built competitive advantages by accepting currency and payment risks that multinational corporations reject. Survival supply chains (food, fuel, water) outperform traditional sectors, with mark-ups reaching 300-400% due to scarcity and transport risk premiums.

## Why does international capital ignore Sudan's war economy?

Sanctions regimes, reputational risk, and financial exclusion prevent major institutions from participating directly. However, offshore entities, regional middlemen, and diaspora networks operate with less scrutiny. Lebanese, Jordanian, and Egyptian business houses act as intermediaries, layering transactions across jurisdictions to obscure ultimate beneficiaries. Insurance and hedging mechanisms remain scarce—forcing participants to accept forex volatility (the Sudanese pound has lost 98% of value since 2019) and counterparty default risk as operating costs.

## What are the structural risks for investors tracking Sudan?

Conflict profiteering concentrates in the hands of armed faction-linked elites and their international facilitators. The SAF (Sudanese Armed Forces) and RSF (Rapid Support Forces) control territorial chokepoints where they extract taxation, tariffs, and protection fees—turning logistics into a zero-sum game. Investors who profit today face asset seizure, sanctions designation, or reputational backlash if political settlement favors accountability mechanisms. The International Criminal Court's indictment of former officials (including Omar al-Bashir's crew) signals that today's war-profiteering networks may become tomorrow's sanctions targets.

Currency collapse and capital controls make repatriation of profits nearly impossible through formal channels. Offshore dollar accounts and cryptocurrency channels remain the only viable exit strategies—but these carry compliance and AML scrutiny from Western financial systems.

For East Africa's regional economy, Sudan's war represents both opportunity cost (lost trade) and opportunity creation (smuggling premium). Ethiopia and South Sudan saw trade volumes with Sudan drop 60% since 2021, but their informal cross-border sectors have tripled in value. This bifurcation—formal economy collapse, informal economy expansion—defines the Sudan playbook for investors willing to accept regulatory, currency, and political risk.

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