Russia-Ukraine War Threatens Import-Depending African Economies

African countries imported US$6.9 billion agricultural products from Russia and Ukraine in 2020.

Feb 28, 2022

Last week, the Renaissance Capital Investment Bank Economist Director Charlie Robertson warned that the Ukraine-Russian war will severely impact African countries that depend on food imports from Europe.

“Africa keeps centuries-old ties with Western countries,” Robertson said, stressing that this continent imported US$6.9 billion in agricultural products from Russia and Ukraine in 2020.

He considered that the greatest danger facing Africa is the likely rise in bread prices since Russia and Ukraine currently supply about 30 percent of the world’s wheat. “Egypt, Tunisia, Morocco, Libya, and Algeria —which heavily consume wheat— could be most affected by tight supply and rising prices,” Robertson stated.

Supply chain disruptions contribute to high inflation that will also impact energy prices. “The budgets of oil-producing countries like Nigeria and Angola could benefit from this situation, but the cost of transport is likely to increase for all Africans,” Robertson noted.

Kenyan authorities are concerned about the impact that the war and the financial sanctions imposed by the U.S., the European Union (EU), and the U.K. against Russia will have on their country’s tea industry, which helps Kenya earn foreign currency.

“Tea and other beverages are classified as food and should not normally be affected by trade sanctions,” East Africa Tea Traders Association (EATTA) Director Edward Mudibo, recalling that Russia is among the top five consumers of Kenyan tea.

Read also:
The Dollar Devours the Euro

Despite this, he considered the market is likely to destabilize given that some traders do not want to take the risk of negotiating with a country excluded from international payment systems.

Published at

We remind our readers that publication of articles on our site does not mean that we agree with what is written. Our policy is to publish anything which we consider of interest, so as to assist our readers  in forming their opinions. Sometimes we even publish articles with which we totally disagree, since we believe it is important for our readers to be informed on as wide a spectrum of views as possible.