Economic crisis heightens Africa’s conflict tensions: OECD

FRANCE: The global economic crisis has heightened the risk that “tensions could explode” in Africa, where growth will be slashed this year because of recession in rich nations, the OECD warned Monday.

“There are signs of increasing political tension that cannot be ignored,” said a report by the Organisation for Economic Co-operation and Development (OECD), African Development Bank (AfDB) and UN Economic Commission for Africa which said the continent’s growth would be cut to 2.8 percent this year after 5.7 percent in 2008.

Stressing that it was using “optimistic” estimates, it forecast a moderate 4.5 percent recovery in Gross Domestic Product in 2010.

“The situation remains tense in some countries and new tensions could explode in the coming months due to the worsening of economic conditions due to the global crisis,” said the report.

It highlighted widespread fallout from the crisis already seen in mass layoffs in the key mining sector.

“Although several governments managed the situation in 2008 by implementing support measures and containing social discontent, the situation is likely to be more challenging in 2009, in a context of reduced public resources.”

Commodity prices and demand from Western countries have collapsed in the crisis. The OECD said that while Asia remains a growing trading partner, particularly China and India, the demand was mainly for commodities and this has fallen off dramatically.

Four of the 52 countries surveyed will fall into negative growth: Angola, Africa’s biggest oil exporter, could slump from 15.8 percent growth in 2008 to -7.2 percent this year. The Seychelles (-0.4 percent), Democratic Republic of Congo (-0.6 percent), Chad (-0.7 percent) were also predicted to fall into minus growth.

Central Africa will suffer worst from the crisis, with overall growth slashed to 0.2 percent, while East Africa should still see GDP rise by 5.5 percent.

South Africa, the continent’s biggest economy, will see GDP growth fall from 3.1 percent in 2008 to 1.1 percent this year.

The OECD highlighted how a 3.3 billion dollar Nigerian-Chinese deal to build cement plants across Africa has been suspended. A nine billion dollar accord between China and DR Congo for mineral resources in exchange for infrastructure has also stalled.

Paris, Monday, AFP