Inflation and unrest in sub-Saharan Africa


Inflation in developed economies and in the Sub-Saharan Africa region has accelerated quite significantly. Central banks reacted and in most cases policy rates were adjusted upwards to stem price pressures.

The expected slowdown in global economic activity due to these monetary tightenings has depressed global commodity prices such as oil and food, which are now back to levels seen before Ukraine invaded Ukraine. Russia and still above the levels we saw in early 2021.

Slowing food and oil prices could lower inflation in the coming months, although the downward trajectory is slow and starting from very high levels. Pressures on household incomes will remain predominant.

We discuss political developments and the potential for social unrest in selected countries in sub-Saharan Africa over the next six months.


The price of gasoline is the only price increase that the government fears above all else. The fuel subsidy has been the most sacred cow in Nigeria for many years, even after several studies showed that it benefits middle-class car owners more than the poorer sectors of society.

The cost of fuel subsidies quickly skyrocketed. The government has pledged to keep pump prices at one of the lowest levels in the world, equivalent to around 45 US cents a litre, rather than passing on part of the cost.

While Nigeria is the largest oil producer in the sub-Saharan African region, the country does not appear to have benefited from the resilience in global oil prices seen in recent months. Subsidies suck up so much money that state oil companies barely pour any money into state coffers. Nigeria imports all of its refined petroleum products, another cost to consider.

An economic crisis comes on top of a catastrophic security situation in all regions. This will have an impact on the presidential election next February. The ruling APC and the PDP’s main rival have chosen two politicians in their seventies as candidates. Peter Obi, who left the PDP to become the candidate for the minor Labor Party, galvanizes young voters as a third-party candidate and increases the possibility of a run-off election, which has not happened in Nigeria since the reinstatement of democracy in 1999. It also likely increases the likelihood of major election violence, especially if the outcome is close and contested.


Ghana has often been presented as a model of economic and political stability in Africa. Recently, the rising cost of living has led to violent anti-government protests in Agra. Dwindling economic fortunes forced the government to announce on July 1 that it would hold talks with the International Monetary Fund on a package to help it weather the current economic shocks.

The country is struggling with extreme inflation, budget deficit and debt problems, which has been made much more difficult as Ghana has been unable to sell foreign bonds in the international capital market.

Trade unions and the main opposition, as well as other groups, are threatening to stage further protests in the coming weeks to two months, especially if the IMF program with Ghana is accompanied by a series of major cuts in public spending, such as freezing public spending. sector employment. This could cause people to take to the streets to protest the cost of living pressures they face.

The next election will not be held until December 2024, which will give the administration about two years to turn the economy around.


The government has made significant purchases of weapons for the ongoing conflict in Tigray, especially military drones. The conflict also has an impact on the political environment: there is a real fear among people that if they demonstrate against the government at this time, they will be labeled or portrayed as supporting the insurgents against the government in the north, the Tigray People’s Liberation Front, or TPLF. There are also fears that the protests against the government could provide the TPLF with a means of trying to come back to regain control of the country. We don’t think that’s likely.

This imposes a limiting factor on the extent of anti-government unrest we see in the country, even with upward pressure on prices and the economic difficulties the country finds itself in.

Other factors are limiting civil unrest in the country, including the impact of Ethiopian security forces. In general, when demonstrations are organized in Ethiopia, the repression tends to be very harsh by the police, sometimes supported by the Ethiopian army itself.

There has also been a growing feeling, especially among young people, that protesting and demonstrating has become pointless because the government is not responding to them. The most disenfranchised opposition and the most disgruntled people tend not to form protest movements but to turn to armed struggle.

This makes it less likely that we will see the kind of unrest we saw from 2014 to 2018. Instead, we expect other forms of security threats in Ethiopia, be it war civilian, in the north, around the Tigray region, or insurgencies. and terrorism in much of the rest of the country.

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Posted on Aug 25, 2022 by Jordan AndersonPrincipal Analyst, Research Advisory Solutions, S&P Global Market Intelligence


Langelihle MalimelaPrincipal Analyst, Country Risk, Africa, S&P Global Market Intelligence


Martin-RobertPrincipal Analyst, Deputy Director – Sub-Saharan Africa Country Risk, S&P Global Market Intelligence


Thea FourieAssociate Director, Sub-Saharan African Economics, S&P Global Market Intelligence


Theo AcheampongSenior Analyst Country Risk – Sub-Saharan Africa, S&P Global Market Intelligence

This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.


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