chapter  4
24 Pages

Further Financing Efforts

As Kenana's project costs escalated, the package of financing which was in place by 1975 was found to be inadequate. A wealthy and willing new partner had to be found.

Sudan's decision to borrow heavily in order to pay for development came at around the same time as the 1973 oil price rise, which had resulted in some OPEC members, principally Arab states, accumulating a huge balance of payments surplus over a relatively short period, largely at the expense of industrialised economies, many of whom were also major agricultural commodity exporters. The possibility of retaliatory action on this front gave rise to concern regarding 'food security' within the Arab world and, consequently, the concept of developing the natural resources of Sudan (a fraternal Arab state with which both Kuwait and Saudi Arabia had traditionally enjoyed most cordial relations) in order to make it into a large-scale food exporter, held great appeal.