East Africa In Crisis as Pain and Desperation Reign

By Soko Directory Team / March 9, 2017


East Africa is currently experiencing a crisis that has hit the region from many fronts; drought, famine, civil war and terrorism which has and still is affecting the region’s economic growth. Most East African countries are severely affected by drought with failed rains combined with increasing food prices. Conflict and limited humanitarian access have resulted in food and water shortages, acute malnutrition and mass displacement throughout the region. The lack of rain has also contributed to massive livestock deaths undermining the livelihoods of those who depend on them for economic and food security as seen in Kenya, Somalia and Southern Sudan.

While the severe drought has undoubtedly led to the huge scale of disaster, this crisis has been caused by people and policies, as much as by weather patterns. If more action had been taken earlier It could have helped mitigate the severity of the current crisis. It is no coincidence that the worst affected areas are those suffering from entrenched poverty due to marginalization and lack of investment.

Terrorism imposes a significant economic effect on the societies and does not only lead to direct material damage but also long term effects on the local economy. There isn’t much literature when it comes to the primary cost of households when it comes to terrorism. It has a negative effect on life satisfaction and fear is a more probable risk. Business and firms, especially the ones operating to or from insecure countries, are frequent victims of terrorist events .  Terrorism forces local and national authorities to spend billions on the prevention of terrorism and the detection, prosecution and punishment of terrorists.

drought-famine-east-africa

Civil wars are expensive (in money and resources), destructive (of capital and human capital), and disruptive (of trade, resource availability, labor management). Large wars constitute severe shocks to the economies of participating countries. Notwithstanding some positive aspects of short-term stimulation and long-term destruction and rebuilding, war has generally impeded on the economic development and undermines prosperity. Several specific economic effects of war recur across historical eras and locales. This has been seen through the civil war in Kenya in the year 2007(the post-election violence) and the current civil war in Southern Sudan and Somalia which greatly led to poor economic development in the respective countries and EAC at large. The most frustrating effect of the war is the fact that it causes food supply shortage which has consequently push up prices of the little available supply and thus as a result, reducing the living standards.

With East African Countries facing these challenges, growth of their economies is minimal. Prediction, especially about the future becomes quite difficult. Economic growth is perhaps the most important determinant of whether a county’s fiscal policy is sustainable, and growth slowdowns have caused many public debt crises currently and in the past.  We must not stand by and watch this tragedy unfold.

Related: How high will Kenya’s Inflation go with the ongoing drought?


Written by Amina Martha.



About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system. Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

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