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Global climatic changes and water scarcity are attracting major concerns in the recent literature. These issues are particularly important in a country like Sudan, where agriculture contributes over 31% to GDP and the bulk of agricultural production depends on rainfall. Similar to several countries in the Sahel belt of Africa, Sudan has suffered a number of long and devastating droughts during the last decades. The most severe drought occurred in 1984, which was accompanied by widespread displacement and famine, while localized and less severe droughts were also recorded during the late sixties, late eighties and early nineties (UNEP, 2007). This paper is an attempt to use the history of drought in Sudan exemplified by the famous droughts of 1984 and 1990 to estimate the economic effects of future droughts on Sudan. The two drought periods are simulated in a Computable General Equilibrium (CGE) modeling framework that is defined and calibrated to produce parameters necessary for the analysis. The model uses the most recent Social Accounting Matrix (SAM) that represents the Sudanese economy in 2004 as underlying database. Results indicate and confirm the ability of the model to determine the magnitude of the loss in the domestic supply as well as the welfare and overall economic implications of droughts. This provides insights for all relevant institutions such as the Strategic Reserve Corporation and the food aid agencies working in Sudan to estimate the mitigation requirements for future drought incidents in Sudan.


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