MACROECONOMIC FACTORS AND DEVELOPMENT EXPENDITURE IN SUDAN (1990–2018): THE INTERVENING ROLE OF FISCAL SPACE AND THE MODERATING EFFECT OF INTERNATIONAL SANCTIONS
Abstract
This study examines the influence of macroeconomic factors on development expenditure in Sudan over 1990–2018 and introduces fiscal space as an intervening variable and international sanctions as a moderating variable. The independent construct comprises government revenue, gross domestic product (GDP), exchange rate, rate of inflation and economic growth, while development expenditure is reflected through capital expenditure, public investment ratio, sectoral allocation and utilization rate. Fiscal space captures the budgetary room through which macroeconomic conditions are translated into feasible development spending, whereas the sanctions regime is treated as a contextual moderator that can weaken access to trade, finance, foreign exchange and external resources. The study uses secondary annual time-series data from the Central Bank of Sudan, the Central Bureau of Statistics and the Ministry of Finance and National Planning. Descriptive, comparative and correlation analyses are organized around three policy periods: 1990–2005, 2006–2010 and 2011–2018. The research data show substantial instability in development expenditure and marked changes in the association between macroeconomic variables and development expenditure across the three periods. Government revenue and GDP were strongly positively correlated with development expenditure in 1990–2005 (r = .98 and r = .90 respectively), while the pattern changed in later periods. The 2006–2010 period, associated with partial external normalization, recorded the highest development-expenditure-to-revenue ratio (32%), compared with 23% in 1990–2005 and 16% in 2011–2018. The findings support the argument that macroeconomic conditions affect development expenditure partly through available fiscal space and that sanctions alter the strength and direction of these relationships. The study recommends stronger domestic revenue mobilization, credible macro-fiscal planning, exchange-rate and inflation stabilization, protection of productive capital spending, improved project execution and policies that expand lawful external economic engagement.
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References
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