Jean-Paul Adam, director of the Technology, Climate Change and Resources Management Division of the United Nations Economic Commission for Africa (UNECA), said in an interview with this reporter a few days ago that on the surface, banking crises such as the Silicon Valley Bank and Credit Suisse banking crisis occurred in the United States and Europe, far away from Africa, an emerging market, but in fact, the banking crisis in the United States and Europe has a very serious impact on the African economy, making Africa, which is already in multiple crises, even worse.
Jean-Paul said that before the banking crisis in the United States and Europe, African economies were already in multiple crises, such as the debt crisis, inflation caused by the Russian-Ukrainian conflict, the energy crisis, and natural disasters and food crises brought about by climate change. The banking crisis in the US and Europe has caused panic around the world, especially in countries, institutions and individuals that have invested heavily in the US and European banking sector.
Jean-Paul believes that unlike the 2008 financial crisis, the banking system of the United States and European countries has not yet experienced systemic risks and crises, because bond investment or financial product investment is still safe. However, the biggest problem caused by the banking crisis in the United States and Europe is the lack of sufficient liquidity in the global financial system, which has led to a tightening of investment and a relatively high risk aversion of funds. For the African market, the next two years will face a situation of low investment, which will increase the difficulty of financing in Africa, and have a serious impact on the economies of African countries that have fallen into debt crisis, or may plunge Africa into a new financial crisis. That is why UNECAL and others have called for more aid to Africa, while African countries need to optimize the investment climate as soon as possible to attract capital inflows.
While Africa's economies as a whole are on a growing trend, they are growing lower than before the pandemic, and growth has been eroded partly by inflation. Of course, if investment is done in the right direction, the continent will become one of the important engines of global economic growth. For example, Africa's energy demand is large, and if companies invest in the energy sector, Africa's economic growth will accelerate, which is a win-win for investors and African countries. In addition, developed countries are now focused on the conflict in Europe, believing that it is difficult to increase investment in sustainable development at present. However, if investment in sustainable development is not increased, Africa will face more conflicts, which will have a negative impact on the stability of the continent.
(Addis Ababa, 4 April -- Wang Chuanjun, reporter of this newspaper in Addis Ababa)