- The Russia-Ukraine war has impacted Africa’s economic growth by increasing food shortage
- Africa is facing impending food crisis that will see over 140 million go hungry in 2023
- Economists remain optimistic Africa can recover against all odds
Economic growth in Sub-Saharan Africa (SSA) was projected to contract from 4.1% in 2021 to 3.3% in 2022, a regression caused by a general global economic slowdown.
Africa’s dependency on long supply chains left it vulnerable to adverse economic conditions in the global market and the global supply end. Covid-19 dealt the world a blow but Africa sailed through the storm, barely.
However, the Russia-Ukraine war disrupted grain and oil supply dumping Africa’s growth prospects notwithstanding that a number of African states are on the brink of a debt crisis.
Things were made worse with the ongoing catastrophic effects of global warming that have left the continent suffering from adverse weather conditions.
As we enter 2023, Africa is facing a food crisis that will see over 140 million suffer from hunger, lack of water and extreme malnutrition.
The World Food Programme says owing to global climate change, some parts of Eastern Africa are entering a fifth consecutive year of unreliable rainfall.
For a continent that relies on rain-fed agriculture, 2023 might be the toughest year if the rains fail again.
Worse still, due its dependency on long supply market chains, even where food is available, inflation has already set in. According to recent UNICEF studies, as of mid 2022, 29 of 33 countries in Sub Sahara Africa had inflation rates over 5% and another 17 countries already had double-digit inflation.
Despite optimism of its potential, Africa will need to self produce in the long run and cut its long supply and market chains short in the short term.
There is no escaping the debt trap for Africa so despite high hopes of potential in resources and human capital, Africa remains a source of cheap resources and a market for expensive goods.
As it is, Africa’s debt chokehold is only expected to tighten its grip with projections forecasting debt elevation of 59.5% of GDP in 2022/23 across Sub Sahara Africa.
For context, African governments spent 16.5% of their revenues servicing external debt in 2021, up from less than 5% in 2010.’
According to sector experts; “These economic challenges come at a time when countries’ ability to support growth and protect poor households is severely constrained. The fiscal deficit of the region expanded during the pandemic to 5.6% of GDP in 2020 (from 3.0% of GDP in 2019). In 2022, the deficit amounts to 4.8% of GDP due to consolidation efforts.”
Rome 1960: Against all odds
It is not how many times you fall but how many times you get back up. Africa beat all odds in the 1960 Olympic Games in Rome, when a barefooted Ethiopian named Abebe Bikila broke the world record beating all the odds that were against him, despite predictions to the contrary.
The Africa Development Bank (AfDB) President Adenisia recounted that historic moment earlier in 2021 during the Africa Investment Forum (AIF). Against all odds, the banker remains confident that Africa will beat the odds stack against it.
Others seem to agree. There are projections that in 2023 and 2024, despite hunger, import dependency, overwhelming debt conditions and in the face of climate change, Africa is projected to bounce back to register a growth rate of 3.5% and 3.9% respectively.
“Excluding South Africa and Angola, the Eastern and Southern African region are expected to grow to 4.5% next year and 5.0% in 2024,” reads the World Bank report.
Setting the trends will be East Africa with its economic power house Kenya leading the way with projected growth of 5.0% in 2023 (down from 5.5%) and then back up to 5.3% in 2024.
“Excluding Nigeria, the Western and Central Africa sub-region is projected to grow at 5.0% in 2023 (up from 4.2%), and growth will firm in 2024 (5.6%),” the report reveals.
So what should Africa do to secure this unlikely but yet possible recovery?
“The looming threat of stagnation worldwide amid a landscape of multiple new and covariate shocks emphasizes the need for African policymakers to implement policies that accelerate structural transformation through productivity-enhancing growth and creating more and better jobs,” advises the World Bank.
Further still, the World Bank implores that the need to “Boost agricultural productivity is essential to drive a growth-enhancing structural transformation process.”
“Amid soaring food prices and supply constraints, policy makers need to avoid making previous policy mistakes (bans or tariffs/taxes on exports and imports), and ensure international trade flows,” the World Bank cautions African leaders.
How African leaders will respond to the crisis is anyone’s guess but one thing is for sure, it is not the time to think national but continental. As Winston Churchill once said, ‘Never let a good crisis go to waste’. This might just be the right moment for Africa to wean itself off food and fertiliser imports by nurturing its own capabilities.