Far from kyiv, Africa is feeling the economic fallout from the Ukraine crisis

Lagos (AFP) – From airlines in Nigeria to shoppers in Malawi, Africans are feeling the impact of the Ukraine crisis with heartbreaking increases in the price of fuel, grain and fertilizer.

World oil prices hit decade-long highs of over $100 a barrel shortly after Russia invaded Ukraine on February 24, dealing a blow to many businesses south of the Sahara. .

Ukraine and Russia are also major suppliers of wheat and other grains to Africa, while Russia is a major fertilizer producer.

The impact of the war and Western sanctions against the Kremlin are already beginning to translate into higher prices for agricultural inputs and imported grain, AFP offices in Africa report.

For Lagos baker Julius Adewale, the crisis is a perfect storm.

Nigeria’s fragile power grid recently provided only a few hours of electricity a day, forcing Adewale to turn to diesel generators for electricity, the cost of which has now skyrocketed.

“There’s been no light since yesterday and we’ve been running on gen since yesterday,” Adewale said this week as workers stacked piles of loaves at his bakery.

Wheat flour stored in a warehouse in Ibafo, Ogun State, South West Nigeria PIUS UTOMI EKPEI AFP

“(The) cost of production has increased tremendously.”

Nigeria is Africa’s biggest oil producer and economy, but it has little refining capacity.

The government subsidizes the cost of gasoline, but diesel and aviation fuel are sold at market price.

Several local airlines warned this month that they were being forced to cancel flights due to shortages of aviation fuel.

In Nigeria, diesel used to sell for around 300 naira (0.72 cents) per litre, but now costs 730 ($1.75) per litre.

“I don’t know how we are going to cope because 70% of industries are diesel-powered,” Lanre Popoola, regional chairman of the Manufacturers Association of Nigeria (MAN), told local media.

“Other companies are also running limited hours on diesel because they can’t afford to run generators all day.”

Difficulties ahead

If the crisis drags on, said Eurasia Group analyst Amaka Anku, African countries that are big importers of fuel and grain will be among the losers, though exporters of those commodities may be among the winners.

There are also heavily indebted countries, such as Ghana, which will grapple with higher borrowing costs as investors’ risk appetite declines, she said.

Gas producers like Tanzania, Senegal and Nigeria could benefit from steps taken by Europe to end its reliance on Russian energy, said Danielle Resnick of the Brookings Institution think tank.

But, she said, the immediate challenge was the difficulty for African families, millions of whom are already struggling to cope.

“War in Ukraine means hunger in Africa,” International Monetary Fund (IMF) Managing Director Kristalina Georgieva said on Sunday.

High prices will, for example, worsen food insecurity in conflict-torn Ethiopia, where nearly 20 million people need food assistance.

– Inflation already here –

In many parts of Africa, the inflationary machine has already kicked into high gear, AFP offices report.

In Kenya, a two-kilogram (4.4 pound) bag of wheat flour now sells for between 150 and 172 Kenyan shillings (1.3 to 1.5 USD), compared to less than 140 shillings in February.

Africa faces a double whammy for food - prices of Russian fertilizers and grain imported from Russia and Ukraine have soared
Africa faces a double whammy for food – prices of Russian fertilizers and grain imported from Russia and Ukraine have soared Simon MAINAAFP

According to government figures, sub-Saharan Africa’s third-largest economy typically gets a fifth of its wheat imported from Russia and another 10% from Ukraine.

As for fertilizer, a 50-kilo bag that cost 4,000 shillings last year is now changing hands for 6,500 shillings ($57) – a figure set to rise with the start of the planting season this month. .

In the Ugandan capital Kampala, the Ukrainian crisis has already caused a spike in the prices of soap, sugar, salt, cooking oil and fuel.

“Most commodities are produced locally but some ingredients are imported and their prices are dictated by shocks in international markets,” Deputy Finance Minister David Bahati told AFP.

Cooking oil went from 7,000 shillings a liter ($1.94) in February to 8,500 shillings ($2.4) and a kilo of rice from 3,800 to 5,500 shillings, according to retail outlets in Kampala.

“My family of four spends an average of 5,000 shillings on food and other basic necessities, but that’s not enough anymore…I now spend over 10,000 shillings,” Ritah Kabaku told AFP. , 41, saleswoman in Kampala. .

“Victims of War”

Wary of Ukraine-fueled inflation, Mauritius’ central bank raised its key rate to 2%, its first hike since 2011.

“It is unfortunate that when the sky cleared after Covid 19 more clouds appeared,” Prime Minister Pravind Kumar Jugnauth said in a televised address.

In Mogadishu, the Somali capital, prices for fuel, cooking oil, building materials and electricity have soared.

“A week ago, the 20 liter jerrycan of cooking oil cost $25, today it’s about $50. A liter of gasoline cost $0.64 and today it costs about $1. $80 is crazy,” said shopkeeper Mohamed Osman.

Daily bread: The rising cost of bread will be a hardship for many poor families
Daily bread: The rising cost of bread will be a hardship for many poor families PIUS UTOMI EKPEI AFP

In southern Africa, prices of bread and cooking oil in Malawi have risen by an average of 50%.

“This war is not about us and it is not fair that we pay such a high price,” Fatsani Phiri, a listener who was buying bread in the capital Lilongwe.

“We cannot always be victims every time there is a war somewhere in the world.”

Christi C. Elwood