Nigeria and several other African countries have been warned by the International Monetary Fund that they may face food shortages and other problems in the near future due to the ongoing war in Ukraine and soaring prices. fuel, energy and raw materials.
Russia and Ukraine are major suppliers of grains such as wheat and edible oils to many countries in Africa, accounting for around 50%. Since the start of the war, the threat of shortages has driven up the prices of these products and the cost of oil, gas and coal. It has also caused inflation to rise around the world, with several economies on the brink of recession.
African countries, including Nigeria, are particularly at risk due to high levels of debt, developing economies and reliance on certain imports that are now hard to come by.
IMF African Department Director Abebe Selassie spoke to the media via video link.
“Rising food prices will hurt the most vulnerable…food security is already a critical issue across the Sahel.”
He explained that this was the latest in a series of crises, and that it risked aggravating some of the complex political challenges involved. These include “the social and economic legacy of the pandemic and “rising global inflation”.
Selassie warned that governments and lawmakers must act quickly to meet the challenges ahead because there is no time to lose.
Forex tells a different story
Before the war broke out, it looked like economies were starting to recover from the pandemic. For example, in Nigeria, during the first quarter, the total value of dollars traded in the country’s foreign exchange market peaked at $14.5 billion. This is an increase of more than 200% over the previous year, which recorded only $4.82 during the same period.
The largest of these increases was seen in March when trading volume reached over $6.5 billion. Over the past few years, Nigeria has seen an increase in the number of forex site users.
According to several estimates, more than 300,000 Nigerians are interested in forex trading or are actively trading in the country. This has increased dramatically over the past two or three years, especially as more and more people come online. Additionally, the availability of an online forex demo account makes it easier for new beginners to practice their trades before jumping in head first. Online trading through secure platforms is also a demonstration of public confidence in the economic situation.
As the reason behind such impressive numbers, Ripples Nigeria attributed it to locals’ love of importing products from abroad. But it’s also important to note that this would only be possible if the economy was doing well and people had disposable income to spend.
walk with care
The messages are somewhat mixed. On the one hand you have the IMF warning of food insecurity and inflation, but on the other you have impressive exchange figures and the World Bank talking about lifting sub-Saharan Africans out of poverty. What we can conclude from this is that we live in uncertain times. The economy, food supply and various other topics are changing, and it is not yet clear what kind of impact this will have on our societies. We can only hope that the upward trend in the foreign exchange and spending market will continue in the medium to long term.