Enterprise Recovery in Conflict-affect Sudan

What does building common interest look like? How might WEE recovery project build social cohesion in the complexity and uncertainty of war.

Armed conflict erupted between the Sudanese Armed Forces (SAF) and the Rapid Support Forces (RSF) across Sudan on 15 April 2023, including around Khartoum, Merowe, Nyala, Al Fasher and El Obeid. Since then, armed violence has intensified, particularly around Khartoum and in conflict-prone areas of the country such as the Two Areas and Darfur, increasing risks of ethnicization of the conflict and the descent into a civil war, with regional implications. The conflict in Sudan is taking a massive toll on human lives, public infrastructure, and basic services, separating families, and placing immense pressures on host communities. By the end of August 2023, the conflict in Sudan has displaced 4.8 million people (more than 10 per cent of the population), with more than 1 million people fleeing across borders into neighboring countries. In total, at the end of August 2023, IOM estimates that Sudan hosts more than 7 million internally displaced individuals. Newly displaced people come from across all states of Sudan, but the vast majority (73 per cent) have moved out of Khartoum State. Mostly in Northern (18 per cent), West Darfur (15 per cent), River Nile (14 per cent) and White Nile (12.5 per cent) states.7 The majority of internally displaced people fled their homes in Khartoum (1.3 million people), followed by West Darfur (303,000), South Darfur (143,000), Central Darfur (97,000) and North Darfur (70,000). In addition to the internally displaced, over 1 million people, including refugees, asylum seekers and returnees, have crossed into neighboring countries, including Central African Republic, Chad (41.4 per cent), Egypt (26.6 per cent), Ethiopia, and South Sudan (22.7 per cent).8  The crisis exacerbates decades-long fragility, exclusion, and dependence on humanitarian aid. In 2020, the Human Development Index for Sudan was 0.51, ranking Sudan at 170 out of 188 countries. The United Nations (UN) Development Challenges Index placed Sudan 8th-worst globally due to the collapse of basic services, environmental degradation, and poor governance – now further compounded by conflict. The country has been struggling with a worsening multi-year socio-economic crisis before the outbreak of the armed conflict: Economic growth had been negative between 2019-2022 due to political instability, lack of competitiveness, a poor business environment and social turmoil. Failure to generate economic growth has led to increased poverty, which stands at 61.1 per cent according to recent official poverty estimates by the World Bank, based on the 2014-2015 National Household Budget and Poverty Survey. Regional disparities are wide, with increasing poverty in urban centers, especially Khartoum and the Eastern part of Sudan. The inflation rate hit a high of 359 per cent in 2021 but fell back down to 83.6 per cent by January 2023. However, the current conflict has retriggered skyrocketing inflation, with prices for basic commodities, energy and fuel increasing rapidly. Goods have become scarce since the outbreak of violence, especially in the hardest-hit urban areas of Khartoum as well as around densely populated areas in Darfur.  MSMEs in Sudan have been particularly affected by the conflict. These businesses, often the backbone of the economy, have struggled to survive amidst the violence and instability. MSME owners face numerous challenges, including shortages of goods, customers, and transportation difficulties due to the disruptions caused by the conflict. Additionally, the high cost of fuel and the risk of getting caught in the crossfire further complicate their operations besides the fact that most of Sudan’s manufacturing capacity was in the Khartoum area and has either been destroyed or is unable to operate, resulting in severely reduced availability of processed foods, light manufacturing, services, and medicines. The conflict has severely hampered economic growth and development in Sudan. With businesses struggling to stay afloat, unemployment rates have risen, exacerbating the economic hardships faced by the population. The already vulnerable economic sectors, such as agriculture and manufacturing, have been significantly impacted, further limiting the country's ability to recover and rebuild.  Many civilians are facing difficulties accessing water, food, fuel, cash, basic medical supplies, and other critical commodities. According to the World Food Programme (WFP), the number of acutely food insecure is expected to increase by 2-2.5 million to a total of 19 million across Sudan in the next 3-6 months. Before the current conflict, Sudan already faced high levels of food insecurity. As of June 2023, FEW NET estimates that 11.9 million people in Sudan are highly food insecure. The conflict and the associated socio-economic deprivation have driven about 20.3 million people across Sudan (over 42 percent of the country’s population) into high levels of acute food insecurity, between July and September 2023.  As of March 2023, 14.8 million people were unable to afford the local food-basket, which increased by 28 percent between March 2022 and March 2023. Before the current conflict, food prices were stable, albeit higher than the levels recorded in previous years. According to a rapid market assessment conducted by Mercy Corps in May 2023, the most pronounced price hikes in Khartoum compared to before 15 April include fuel (1251 per cent), sorghum (233 per cent), and flour and bread (140 per cent). Reports from the ground indicate further price increases. WFP forecasts the price of cereals to rise. Sorghum is forecast to reach the peak of last year, a 15 percent increase. The price of sorghum was already high and stood at almost 800 SDGs/kg in March 2023. The price of wheat is also forecast to rise substantially towards previous peaks of more than 1000 SDGs/kg.  Local markets and the availability of cash have been significantly affected by the conflict, including in eastern states. The re-supply of goods due to limited supplies in the country and disrupted transport networks remains a concern, including the import of wheat – forcing people to seek alternatives. Markets in less impacted areas are strained, as the influx of displaced people has put pressure on local resources. A state of emergency has been declared in several cities to confront smuggling of basic commodities and fuel. With livestock being a crucial livelihood for farmers and pastoralists throughout Sudan, the unavailability of livestock vaccines, given the closure of the main laboratory in Khartoum, will have an impact on livelihoods. There are major concerns for the production of 2023 crops due to insecurity, inputs’ shortages, localized moisture deficits and unfavorable weather forecasts. Insecurity remains the main challenge to agricultural operations in Darfur and Kordofan, as limited access to fields has prevented planting. In other regions, the collapse of the banking system has cut short financial resources for purchasing ever more expensive agricultural inputs, such as seeds, fertilizers and fuel. Another factor is the below-average rains in July and the resulting draught, which has affected between 25 and 55 percent of the cropland in some key southeastern crop growing areas, according to FAO’S Agricultural Stress Index. Rainfall performance during September will be crucial for crop development.9  The soaring prices and shortages of key agricultural inputs, including fuel, seeds, agrochemicals, and migratory labor, due to the conflict, are expected to significantly constrain planted area and hence agricultural production. In general, food availability has been severely impacted by the conflict, despite the national higher than average national production of the main staples of cereals, sorghum and millet harvested at the end of 2022. As of 11 June WFP, has lost 40,600 tons of food commodities valued at more than USD 30.2 million, adding to the lack of food. Markets have been damaged and destroyed, and shortages of supplies have been reported at those markets still functioning. Given that some of important agricultural productions regions such as the Darfur region are engulfed in conflict, food availability is likely to be further severely impacted. The COVID-19 pandemic, flooding, and the suspension of much of the planned assistance to Sudan following the 2021 military coup had already contributed to the deterioration of the situation. Now the current conflict will increase pressure on Sudan’s most deprived regions and those hosting IDPs even more. Among the poorest and most vulnerable groups are an estimated 60% of the population engaged in the informal economy, with women and children forming the majority. Further deprivation of these groups and their families is highly likely. Women caught up in the heavy fighting in urban areas are especially vulnerable, as they work as tea and food sellers or petty traders on the streets of Khartoum, often providing the sole source of income for their households. Lack of demand and the high risk of conflict-related violence exacerbate the situation further.  Cases of gender-based violence continue to be reported across the country. In most of the cases, the survivors were reportedly between 12 and 17 years old. Incidents of sexual violence, including rape, sexual assault, sexual exploitation, and physical violence, have also been reported by women and girls who have fled the conflict in Khartoum and other areas, as well as those on the move, with some survivors arriving in neighboring countries pregnant as a result of rape.10 Women cited the risk of gender-based violence as a reason for their flight from Sudan, and concerns for their personal safety and that of their children. Adolescent girls are also facing an increased risk of child marriage as some families are allegedly resorting to it, in an attempt to “shield” them from further risks of sexual violence, assault or exploitation. Smuggling and human trafficking risks are on the rise,11 partially due to the lack of alternative opportunities to reach the border, the urgency of people to escape insecurity and deprivation, forcing them to resort to taking dangerous routes. The presence of armed actors as well as shortage of basic resources —including water, food, and fuel—continue to exacerbate the risk of gender-based violence and sexual exploitation and abuse. While long periods trapped within homes due to fighting increases incidents of intimate partner and domestic violence.  The uncertainty and the magnitude of the impact of the armed violence in Sudan requires a response that goes beyond traditional forms of crisis response and recovery processes. Addressing the development root causes will be required to meet the scale of the crisis in Sudan and the challenges of the “uncertainty complex” identified in UNDP’s 2021/22 Human Development Report.         

Innovation has a place in crisis even in the middle of a war. When the rest of the house is primarily focused on emergency assistance, it's never too early to engage in recovery that tap into low tech technology and addresses more medium term needs. The Acclab can and is about being forward thinking when the rest of the CO is focused on the immediate here and now.

Micro and Small Enterprise recovery. Forging social and economic solidarity through partnerships between women from displaced and host communities in East Sudan

Is there space for innovation in the middle of a war? Can we bring partners to finance recovery when all efforts are engaged in immediate. life saving humanitarian assistance.  Women stay behind in a war, can we anchor livelihoods and economic recovery around them to promote social cohesion and support solidarity economies in East Sudan.

These methods were selected to trigger mobilisation of partners to demonstrate an unusual value proposition and demonstrate the need driven by what the community is telling us in the middle of this conflict as more and more states in the East are shouldering the burden of displacement. 

We are implementing in the middle of active conflict and the fluid nature on the ground requires us to have continuous in-bound and out-bound information sharing to receive real-time feedback from the community.

This cycle is about scale. In 2021 through 2022 we already went through the sense, explore and test cycles for a pilot in the intersectionality of gender, crisis, energy and digital cycle. The current war was a trigger how might we scale this quickly and blend the activities to fit the current context. The champion of this work is GIZ and GSMA both who were identified last year as our partners to scale.