The Impact of Oil Production in General Budget (Development Budget)

Abstract

The major theme of the present study is an appraisal and evaluation of the impact of petroleum revenues in the structure of the budget and so the change in the development budget. Sudan economy is mainly burdened by imports and the budget generally featured by the continuos high deficit. On the other hand there has been an increasing rate of inflation, resulting in a poor development budget. petroleum revenues should be optimized to change the structure of the budget, so that considerable revenues will be directed towards development. The methodological approach of the present study is intercomparison in nature. Secondary data was used. The main source of data includes Ministry of Energy and Mining, and Ministry of Finance annual reports. The study objectives to determine the actual petroleum revenues in the budget and the effect of petroleum revenues in the development budget. Petroleum revenues realized a considerable contribution in the gross ordinary revenues. It’s participation percentage in the gross ordinary revenues is mostly over (40%) among the years (1999-2000). This to some extent have a good effect in the general budget and so in the development budget, but more optimizing of petroleum revenues is needed so as to make a considerable change in the development budget. For optimal uses of petroleum revenues there is a need for liberalization of crude oil price for the local refineries to decrease the local price of petroleum products. Expansion in petroleum industry, documentation and studies about Suddennee petroleum is necessary. Specific quota, provision, ceiling for the budget assigned for oil revenues.