Sudan Central Bank: Liberalizes Exchange Rates, Revokes Prior Controls

On Monday, August 24, 2026, the Central Bank of Sudan, operating from Khartoum, issued a new circular (Policy Management Circular No. 2026/16) that significantly liberalizes the country's foreign exchange market by granting commercial banks greater flexibility in setting exchange rates and purchasing export proceeds. This pivotal regulatory update cancels several previous decisions, including a Policy Management Circular from January 14, 2026, and a Reserves and Gold Management Circular from August 11, 2025, which aimed to enhance stability in the foreign exchange market. The new directive explicitly allows banks to adjust their announced exchange rates at any time during the day, provided these new rates are publicly displayed, and permits them to purchase export proceeds at rates consistent with market supply and demand. This move is framed by the Central Bank as a continuation of its policy to liberalize the exchange rate, amidst wide fluctuations and a severe decline in the national currency.

This development carries substantial legal significance for practitioners, businesses, and the broader Sudanese economy. The shift towards a more market-driven exchange rate mechanism could profoundly impact the operational and financial strategies of entities engaged in international trade, foreign investment, and financial services. For businesses, it implies a greater need for sophisticated foreign exchange risk management and dynamic pricing strategies. For legal professionals, it necessitates a thorough understanding of the new regulatory landscape to advise clients on compliance, contractual implications, and potential disputes arising from currency volatility or market practices. The stated aim of regulating the market and strengthening transaction mechanisms based on supply and demand suggests an effort to foster transparency and efficiency, potentially reducing reliance on parallel markets.

The legal context for this action stems from the Central Bank of Sudan's mandate as the nation's primary monetary authority, empowered by its foundational legislation to regulate the financial sector and manage monetary policy, including foreign exchange operations. The issuance and subsequent cancellation of various circulars, such as the now-superseded Policy Management Circular No. 2022/15 and the Reserves and Gold Management Circular, illustrate the dynamic and often responsive nature of regulatory intervention in Sudan's challenging economic environment. Key parties involved include the Central Bank of Sudan as the regulator, commercial banks as the direct implementers of the new flexibility, and all market participants—from exporters and importers to foreign investors—who will navigate the implications of a liberalized exchange rate regime. The outcome of this specific regulatory change, beyond its stated intent, is not yet reported in the excerpt.

Attorneys and legal professionals should proactively advise clients on the implications of this liberalization, particularly those with significant foreign currency exposure or international business operations in Sudan. This includes reviewing existing contracts for currency clauses, assessing potential impacts on financial reporting and tax obligations, and ensuring compliance with the new requirements for rate transparency and transaction practices. Businesses should be encouraged to develop robust internal policies for managing foreign exchange risk and to seek expert advice on hedging strategies. Continuous monitoring of subsequent Central Bank directives, market reactions, and any further legislative or regulatory amendments will be crucial to adapt to the evolving foreign exchange environment.