Plenary Session V: Russia-Ukraine War-Induced Global Market Disruptions and Impacts on African Economies: Lessons From Selected African Countries

1. www.akademiya2063.org
Russia-Ukraine War Induced Global Market
Disruptions and Impacts on African Economies:
Lessons From Selected African Countries
By
Dr. Ismael FOFANA
AKADEMIYA2063
Director for Capacity and Deployment
2023 AGRODEP Annual Conference
‘Building Resilient African Food Systems amid Health, Conflict and Climate Disruptions’
Kigali, Rwanda | 21-23 March 2023

2. www.akademiya2063.org
Three years of major disruptions in the global trade and markets
of primary commodities, including agri-food commodities
Percentage changes in primary commodity prices 2020-2022, Outlook October 2019 vs. Outlook October 2022
Source: Commodity Market Outlook October 2019 and October 2022 (World Bank, 2022)
Note: Price changes for “Coal, Australia” = 366% and “Natural gas, Europe” = 714%.

3. www.akademiya2063.org
Primary commodities weight heavily in the
export basket of most African countries
0 10 20 30 40 50 60 70 80 90 100
Lesotho
Tunisia
Morocco
Madagascar
Eswatini
Liberia
Ethiopia
Kenya
Sierra Leone
Guinea Bissau
Egypt
Seychelles
Togo
Niger
South Africa
Sudan
Gambia
Tanzania
Senegal
DRC
Rwanda
Benin
Gabon
Cabo Verde
Cote d'Ivoire
Malawi
Guinea
Uganda
CAR
Namibia
Zambia
Ghana
Mauritania
Burkina Faso
Zimbabwe
Mozambique
Botswana
Congo
Chad
Nigeria
Mali
Angola
Cameroon
South Sudan
0 10 20 30 40 50 60 70 80 90 100
South Sudan
Liberia
Ethiopia
Chad
Uganda
DRC
Sudan
Gabon
Seychelles
Ghana
Cameroon
Niger
Sierra Leone
Congo
Morocco
Malawi
Tanzania
South Africa
CAR
Madagascar
Tunisia
Mali
CaboVerde
Eswatini
Kenya
Burkina Faso
Zambia
Angola
Guinea
Mauritania
Nigeria
Egypt
Guinea Bissau
Rwanda
Cote d'Ivoire
Togo
Gambia
Namibia
Senegal
Mozambique
Zimbabwe
Lesotho
Benin
Botswana
Percentage share of primary commodities
in total imports, 2019
Percentage share of primary commodities
in total exports, 2019
Source: Calculations from AATM 2022 database (Akademiya2063 and IFPRI, 2022)

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Heterogeneity in Terms of Trade Shocks
Percentage Changes in Term of Trade
2020 2021 2022
Source: Calculations from Commodity Market Outlook (World Bank, 2022) and AATM 2022 database (Akademiya2063 and IFPRI, 2022)

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Assessment of the distributional growth and poverty effects
Estimate the ramifications of the global trade and market
disruption for the broader economy in selected African countries
 Benin
 Cote d’Ivoire
 Ghana
 Kenya
 Malawi
 Mozambique
 Nigeria
 Rwanda
 Senegal
 South Africa
 Tanzania
 Tunisia
 Uganda

6. Analytical Framework
• Simulation models (Akademiya2063/ReSAKSS Toolbox)
 Single-Country CGE Models
 Micro-simulation Models
• World Development Indicators database (World Bank)
 Macroeconomic data
• Statistics on international trade (United Nations)
 Import and export data
• World Economic Outlook (International Monetary Funds)
 Economic Growth Outlook
• Primary commodity price database (World Bank)
 Annual price predictions for 46 primary
commodities (released in April and October)
Update the
Simulation
Models
Build the
Simulation
Scenarios
Simulation
Tools

7. Simulation Scenarios
“Baseline” scenario: no major changes in the
economies’ trajectories in the absence of the
crisis for the period 2022-2024.
“Ukraine” scenario: disruptions to the
individual country economies resulting from
the changes in global commodity trade and
markets

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Countries facing improving terms of trade Countries facing deteriorating terms of trade
Growth slowed down with increasing pressure
on the balance of payment and foreign reserves
Changes in GDP Growth in 2022, Percentage Point Ukraine vs. Baseline Scenario
Source: Calculations from simulation results (Akademiya2063, 2022)

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Countries facing improving terms of trade Countries facing deteriorating terms of trade
Shocks in global commodity trade and markets
produced heterogenous poverty outcomes
Percentage Changes in Headcount Poverty Index in 2022, Ukraine vs. Baseline Scenario
Source: Calculations from simulation results (Akademiya2063, 2022)
Note: International Poverty Line $1.90 (2020 PPP)
-1.5 -1.1
0.0
0.9
-0.8
Nigeria
Benin
South
Africa
Mozambique
Ghana
0.5
3.1
1.3
0.8
4.4 4.5
1.7
Cote
d'Ivoire
Senegal
Uganda
Rwanda
Malawi
Kenya
Tanzania

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10
Share of Top Export
Commodities in Total Exports,
MOZAMBIQUE
Coal 17.9
Petroleum oils 6.0
Wood sawn 1.9
Tobacco 5.3
Aluminium 24.5
Copper 2.0
Gold 4.6
Share of Top Export
Commodities in Total
Exports, BENIN
Gold 31.8%
Petroleum oils 2.6%
Soya beans 9.1%
Wood sawn 1.2%
Cotton 25.4%
Trading patterns diversification leads to different
poverty outcomes of global commodity price shocks
Source: Calculations from simulation results (Akademiya2063, 2022)
Countries facing improving terms of trade
Source: AATM 2022 database (Akademiya2063 and IFPRI, 2022) Source: AATM 2022 database (Akademiya2063 and IFPRI, 2022)
-1.5 -1.1
0.0
0.9
-0.8
Nigeria
Benin
South
Africa
Mozambique
Ghana

11. www.akademiya2063.org
Russia-Ukraine War Induced Global Market Disruptions and Impacts on African Economies:
Lessons From Selected African Countries
THANK YOU
MERCI
2023 AGRODEP Annual Conference
‘Building Resilient African Food Systems amid Health, Conflict and Climate Disruptions’
Kigali, Rwanda | 21-23 March 2023