The high cost of food and ever rising fuel pump prices are increasingly compelling protesters to take to the streets to vent their anger on host governments.
Most governments are totally stuck and do not know how to respond.Southern Africa nations and East Africa are increasingly expressing dissatisfaction over the intervention from their governments.
Russia’s invasion of Ukraine has resulted in a negative impact on African economies. The war has triggered fuel shortages throughout Africa forcing high transportation costs.
Suppliers have blamed richer nations for paying a premium for cargoes, while soaring margins benefit the refining businesses of companies such as Shell Plc.
“Transport price inflation feeds directly into food inflation –- so keeping it under control has been an imperative, even when fiscal resources have (in some instances) come under greater strain,” Razia Khan, Standard Chartered Bank’s head of research for Africa and the Middle East, said.
“Governments across sub-Saharan Africa are always wary of pressure on urban electorates especially, who tend to be more politically mobilized,” Khan said.
Though the continent includes a number of significant producers of oil, there is limited capacity to refine it into fuel for cars, trucks and planes. That means countries need dollars to buy imported diesel and gasoline.
Currency weakness resulting from rising interest rates in rich countries is exacerbating matters. The currencies of Ghana, Nigeria and Kenya all dropped to record lows against the dollar this week and will continue to depreciate, AZA Finance, a currency broker, said in a note to clients Thursday.