When Russia sent its troops rolling into Ukraine just about a week ago, not much was thought of the impact it stood to have on places as far as the African continent. However, the connectedness of the globe makes it inevitable that conflict in one corner of the world has ripple effects – sometimes lasting- in other parts. Russia’s invasion of Ukraine has had consequences on not just the two countries, but on African countries who are caught in the metaphorical crossfire. Russia is the world’s third-largest producer of oil, churning out 10.5 million barrels per day and also supplying 40% of Europe’s gas requirements. Just days into the crisis, many Africans have started to experience rising costs of crude and fuel, with an elevated scarcity in Nigerian cities for example. Business Edge today explores the impact of the Russia-Ukraine conflict on Africa. Dr XN Iraki joins Tolulope Adeleru Balogun from the Faculty of Management Science at the University of Nairobi, Kenya.
“We thought the world was coming out of COVID induced pandemic and countries getting back to normal; and just when we thought we had come out, here comes the Ukrainian crisis,” said Dr Iraki about the likelihood of another global economic recession as a result of the ongoing conflict. For this to be averted, the crisis needs to be resolved quickly, echoing the statement of the African Union which called on Russia to pull back its troops from Ukraine.
Oil and gas are not the only commodities likely to be impacted by the festering crisis: agricultural products also account for the volume of trade between Russia and Ukraine and the African continent- to the tune of $4billion to the former and almost $3billion to the latter, importing wheat, sunflower oil, soybean and such like. In a time of crisis like this, the flow of these much-needed commodities is interrupted, leading directly to a rise in food prices for African countries, many of whom are already dealing with tight economies.
However, the impact of the Russia-Ukraine conflict cannot be overlooked or overstated: most of the African countries that produce crude oil do not have the capacity to refine petrol and other products. According to Dr Iraki, this poses economic as well as political instability. This is what African leaders have to focus on, especially as the resolution of the crisis is out of their hands.
The full conversation on Business Edge is above.
