16, March 2022
From airlines in Nigeria to shoppers in Malawi- Africa feels economic fallout from Ukraine crisis 0
From airlines in Nigeria to shoppers in Malawi, Africans are feeling the impact of the Ukraine crisis in wrenching increases in the price of fuel, grain and fertiliser.
Global oil prices scaled decade-long highs of more than $100 a barrel shortly after Russia invaded Ukraine on February 24, inflicting a hefty blow to many businesses south of the Sahara.
Both Ukraine and Russia are also major suppliers of wheat and other cereals to Africa, while Russia is a key producer of fertiliser.
The impact of the war and the West’s sanctions against the Kremlin are already starting to translate into higher prices for farm inputs and imported grain, AFP bureaus in Africa report.
For Lagos baker Julius Adewale, the crisis is a perfect storm.
Nigeria’s fragile power grid had recently been supplying just a few hours of electricity per day, forcing Adewale to turn to diesel-fueled generators for power — the cost of which has now soared.
“There is no light since yesterday and we’ve been running on gen since yesterday,” Adewale said this week, as workers stacked piles of loaves in his bakery.
“(The) cost of production has increased immensely.”
Nigeria is Africa’s largest oil producer and biggest economy, but it has little refining capacity.
The government subsidises the cost of petrol, but diesel and aviation fuel are sold at market price.
Several local airlines warned this month they were forced to cancel flights due to aviation fuel scarcities.
Diesel used to sell in Nigeria at around 300 naira (0.72 cents) a litre but now goes for 730 ($1.75) a litre.
“I don’t know how we are going to cope because 70 per cent of industries are running on diesel,” Lanre Popoola, a regional chairman of Manufacturers Association of Nigeria (MAN), told local media.
“Other businesses are also running limited hours on diesel as they cannot afford to use generators all day.”
Hardship ahead
If the crisis is sustained, said Eurasia Group analyst Amaka Anku, African countries which are big importers of fuel and grain will rank among the losers, although exporters of those commodities may be among the winners.
There are also countries that are heavily indebted, such as Ghana, which will struggle with higher borrowing costs as investor risk appetite lowers, she said.
Gas producers like Tanzania, Senegal and Nigeria may benefit from Europe’s moves to end its dependence on Russian energy, said Danielle Resnick at the Brookings Institution think tank.
But, she said, the immediate challenge was hardship for African families, millions of which are already struggling to get by.
“War in Ukraine means hunger in Africa,” International Monetary Fund (IMF) Managing Director Kristalina Georgieva said on Sunday.
High prices will for instance aggravate food insecurity in conflict-torn Ethiopia, where nearly 20 million people are in need of food aid.
– Inflation already here –
In many parts of Africa, the inflationary machine has already lurched into higher gear, AFP bureaus report.
In Kenya, a two kilogramme (4.4-pound) bag of wheat flour now sells for 150-172 Kenyan shillings (US$1.3 to US$1.5), compared to less than 140 shillings in February.
Sub-Saharan Africa’s No. 3 economy usually gets a fifth of its imported wheat from Russia and another 10 percent comes from Ukraine, according to government figures.
As for fertiliser, a 50-kilo bag that cost 4,000 shillings last year now changes hands for 6,500 shillings ($57) — a figure that is likely to increase as the planting season starts this month.
In the Ugandan capital Kampala, Ukraine’s crisis has already caused a surge in prices of soap, sugar, salt, cooking oil and fuel.
“Most of the essential commodities are produced locally but some ingredients are imported and their prices are being dictated by the shocks on international markets,” Junior Finance Minister David Bahati told AFP.
Cooking oil has risen from 7,000 shillings per litre ($1.94) in February to 8,500 shillings ($2.4) and a kilo of rice from 3,800 to 5,500 shillings, according to Kampala retail shops.
“My family of four people spend an average of 5,000 shillings to cater for food and other necessities but this is no longer enough… I now spend more than 10,000 shillings,” Ritah Kabaku, 41, a shop assistant in Kampala, told AFP.
‘Victims of war’
Wary of Ukraine-fueled inflation, Mauritius’ central bank has raised its key interest rate to two percent — its first hike since 2011.
“It is unfortunate that as the sky cleared after Covid 19, more clouds appeared,” Prime Minister Pravind Kumar Jugnauth said in a televised speech.
In Somalia’s capital Mogadishu, prices for fuel, cooking oil, construction materials and electricity have shot up.
“A week ago, the 20-litre jerrycan of cooking oil was $25, today it’s about $50. A litre of gasoline was $0.64 and today it runs about $1.80 — it’s crazy,” said Mohamed Osman, a trader.
In southern Africa, bread and cooking oil prices in Malawi have shot up by an average 50 percent.
“This war doesn’t concern us and it is not right that we should be paying such a high price,” Fatsani Phiri, an auditor who was buying bread in the capital Lilongwe.
“We cannot always be victims every time there is a war somewhere in the world.”
Source: AFP



















27, March 2022
African Development Bank Group signs MOU with ECOWAS for $3.56 million grant to develop West Africa Pharmaceutical Industry 0
The African Development Bank (www.AfDB.org) and the Commission of the Economic Community of West African States (ECOWAS) have signed a memorandum of understanding for $3.56 million in grant funding to support the development of pharmaceutical industries in West Africa.
Lamin Barrow, Managing Director of the Bank for Nigeria and Mamadou Traoré, ECOWAS Commissioner in charge of Industry and the Private Sector, signed the agreement for the Pharmaceutical Industry Development Support Project in West Africa on Wednesday.
The project’s total cost is $3.77 million, to which the ECOWAS Commission will provide $200,000 in cash and $400,000 in-kind.
The funds will support the implementation of regulations to allow duty-free access to pharmaceutical raw materials, packaging, and finished products under the ECOWAS Common External Tariff. It will also help establish an effective regional pharmaceutical regulatory ecosystem by providing technical assistance programs for regional regulatory authorities.
Commissioner Traoré said: “Local production of pharmaceuticals and biologicals has become an imperative and a regional priority, as is the provision of healthcare delivery services. The African Development Bank’s support of these priorities will help ECOWAS achieve its development objectives.”
During the signing ceremony held in Abuja, the African Development Bank’s Director General for Nigeria, Lamin Barrow said: “The COVID-19 crisis has further exposed the fragility of our national healthcare systems and posed significant disruptions to the global health and pharmaceutical supply chains. This underscores the urgency of accelerating efforts to ensure a minimum level of supply of health products.”
The project will enhance the pharmaceutical industry’s competitiveness through improved quality and product standards and help ensure that the region complies with best practices in manufacturing pharmaceutical products and supplies. It will strengthen regional training institutions and laboratories to ensure that the required skills are available to support the industry’s regional growth in a gender-sensitive and environmentally friendly manner.
In response to calls from the African Union and the pharmaceutical industry, the African Development Bank has taken a leadership role in developing and driving a continental Vision and Action Plan for a new African Pharmaceutical order. Bank Group President Dr. Akinwumi A. Adesina announced last year that the institution would mobilize up to $3 billion to support this development.
The project will also advance the Bank’s efforts to support the harmonization of the regulatory environment for pharmaceuticals across Africa at the regional and continental levels. This, in tandem with the operationalization of the African Continental Free Trade Area, will deepen intra-African integration and trade, boosting regional markets.
The Bank’s Vice President for Private Sector, Infrastructure and Industrialisation, Solomon Quaynor, said: “To develop the pharmaceutical industry, the African Development Bank will help to develop local production capacities to increase the market share of African (local and regional) pharmaceutical production value to 45-55% by 2030.”
The project aligns with three of the African Development Bank’s High Five strategic priorities: Industrialize Africa, Integrate Africa, and Improve the quality of life for the people of Africa. It also advances the Bank’s Regional Integration Strategy for West Africa, and is in line with the Bank’s gender strategy, and its strategic response to the Covid-19 pandemic.
The ECOWAS Commission will be the executing agency for this project, which will run for two years, starting from 2022. The West African Health Organisation will be the implementing agency.
By APO Group