Shockwatch: a look at Africa’s most vulnerable economies

30 January 2013

Ethiopia, Senegal and Tanzania are the African economies with the highest potential vulnerability to the ‘triple whammy’ of macro-financial and energy price shocks expected to continue their effect on global markets in 2013.

According to research from the ODI, the continuing slowdown in the euro area, stuttering growth in China and India, and the potential for further increases in energy prices present a systemic challenge for developing economies. Support for countries facing these shocks remains crucially important. The report warns that safeguarding shock facilities amongst international organizations such as the EU, IMF and World Bank is critical to helping poor economies to weather future storms. It also suggests that monitoring external shocks and their possible effects is of crucial importance.

ODI Research Fellow Isabella Massa said:

‘Generally speaking most countries we looked at are doing fairly well in quite a volatile environment but the most vulnerable African countries are especially exposed to the growth slowdown in China and India’

‘The evidence points to significant downside risks for the global economy in 2013, which is why it is vital that countries take a close look at how they can raise their own productivity and target sustained growth at the kind of rates we continue to see across much of Africa.’