"Africa struggles with civil unrest as food prices skyrocket, affecting the vulnerable populations most significantly"
Trigger Alert: African Nations Brace for Potential Unrest as Food Prices Soar
International food prices continue to climbed, posing a significant threat to Africa's economies and fueling concerns over social unrest, according to a report by Oxford Economics Africa. The continent, heavily dependent on food imports, will bear the brunt of the surge that has been brought on by factors such as the Ukraine conflict, export bans, supply chains disruptions and droughts.
In Africa, food weighs heavier in inflation baskets than in advanced economies, often surpassing 25% due to purchasing patterns. Countries like Ethiopia, Zambia, Sudan, and Nigeria have food weightings above 50%, economists Jacques Nel and Petro van Eck revealed in a research note.
Food prices reached record levels in March, increasing by 13% in the fastest rise on record, according to the UN's FAO Food Price Index, but slowed down slightly in April. The reasons behind the price hikes include the war in Ukraine, palm oil export bans, logistical glitches and a decline in US wheat production.
The mounting food prices, combined with increasing fuel bills and unemployment, create a volatile political environment in Africa. Governments are compelled to take action, even at the cost of fiscal consolidation, according to the economists. In response, countries like Egypt and Nigeria have postponed plans to phase out food and fuel subsidies, while Morocco, Kenya, and Benin increased minimum wages.
However, nations with limited fiscal resources, like Ghana and Tunisia, may face popular backlash if they are unable to provide adequate support. Ghana's inflation rate recently peaked at an 18-year high in April, driven by food price growth of 26.6% year-on-year. Moody's Investors Service anticipates higher social and political risks over the next 18 months in the Middle East and Africa due to the sustained global food and energy-price shock.
Several countries in Africa are already grappling with food insecurity, with up to 58% of Africans currently struggling to secure food. Among the most vulnerable to social unrest are South Sudan, Democratic Republic of Congo (DRC), and countries in Southern Africa, experiencing high import dependency and elevated social risks. The challenges include conflict, economic instability, and inefficient transportation systems that cause food losses and inflate prices.
To mitigate the impact, governments are prioritizing investments in transport infrastructure and logistics, increasing domestic food production and providing humanitarian aid in crisis regions. Efforts aim to improve food availability and affordability, thereby reducing the risk of food price-driven unrest across the continent.
- The escalating food prices, coupled with rising energy costs and high unemployment rates, may instigate social unrest in various African nations according to a report by Oxford Economics Africa.
- Countries like Ghana and Tunisia, with limited fiscal resources, could face public backlash if they are unable to offer adequate support in the face of mounting food prices and inflation.
- In an attempt to calm the volatile political environment, governments across Africa are prioritizing investments in transport infrastructure, increasing domestic food production, and providing humanitarian aid to crisis regions.
- As the global food and energy-price shock persists, Moody's Investors Service predicts heightened social and political risks over the next 18 months in the Middle East and Africa, impacting regions prone to food insecurity, such as South Sudan and Southern Africa.
