BOLGA, Ghana – “I will never vote again in my life,” says Mary Akurugu, as she arranges the firewood she sells at a busy market here in Ghana’s Upper East region. Like people across West Africa Akurugu is facing financial struggle harder than she can remember.
By Forgbe Emma Kloh with New Narratives
In a previous business – a small table market where she sold provisions – Akurugu says she could afford a lot more. But that business did not survive the lockdowns of the Covid pandemic. Akurugu has been forced to turn to selling firewood. She is struggling just to pay her children’s school fees.
“This government assured us of better lives but look at the hardships we are facing now. Many of us are unable to afford three square meals,” she says. “There is no money coming from the business and because of that, one of my children, who was attending a private school, has been sent home because I cannot afford to pay her fees.”
Akurugu is one of millions of West Africans facing financial hardship as economies across the world are buffeted by multiple global crises. The Covid-19 pandemic, and lockdowns that followed, slowed global supply chains. That meant food was not harvested and moved before it rotted, for instance. Raw materials did not make it to factories. Just as those supply chains started moving again Russia invaded Ukraine, a major global producer of wheat and other grains. Sanctions imposed on Russia then limited oil exports, driving up the price of fuel around the world.
In October the International Monetary Fund predicted global economic growth would halve from 6.0 percent in 2021 to 3.2 percent in 2022 and would be weaker still in 2023 at 2.7 percent. Apart from the great shocks of the 2008 global financial crisis and the Covid pandemic, it is the weakest growth the global economy has seen in 20 years.
West Africa, dominated by poor fragile economies, is one of the hardest hit areas of the world. Across the region people have been protesting rising prices of fuel and food, as the value of their currencies fall against international currencies, especially the US dollar. Poor economic management by governments is being exposed. Countries carrying large debt are facing major challenges. In recent months Ghana technically defaulted on its debt and the International Monetary Fund agreed to continue discussions on a possible IMF supported program.
But experts say that will only go so far. Some are worried that frustration could spark political instability.
“There are challenges in the economy. Our people are facing a significant level of hardship,” says Dr Lester Tenny, professor and Dean of the College of Business and Public Administration at the University of Liberia. “Government’s role is basically to address those controllable variables that impact the ordinary lives and people in the economy should also control the domestic variables that will improve the quality of their lives. If they are unable to do that, there may be an occurrence of political instability.”
Liberians faced shortages of rice, the country’s staple food, in September and October. Sellers and customers were forced to stand in long lines at the offices of major rice importers.
“I slept in long queues for many days hoping that rice will be available the following morning but that did not happen,” says Miata Kollie a rice seller in Duala. “I did that for almost a week before I could finally purchase for my shop.”
The rice shortage was a blow for Kollie’s business. In turn that meant suffering for her family which lives day by day on the income she receives. “My children had to drop from school because there was no business and no customers,” Kollie says. “It is recently that I put my children in government school because I am not getting money from the business like before.”
The government has blamed the situation on the disruptions in the global supply chain, but importers of the commodity have been demanding a lift in the price to cover their increased costs. The price of rice is set by the government in consultation with importers. In November, government gave in to importers’ demands and increased the price from $US13 for a 25-kilogram bag to $US17. That increase has been felt by consumers and sellers alike.
“I am begging the president to talk to the importers to put rice price down because our customers are not coming like before,” she says. “If he doesn’t do that, we won’t have any customers left.”
Liberian businesses are also suffering from the slowing economy. Susan Tamba runs a soap business and a salon in Soniwein Community. The mother of four has been struggling to make ends meet.
“I braid hair and fix different types of soap, but it is hard for people to buy them because of the economic situation,” says Tamba. “If I do not get customers to braid their hair or get customers to buy my soap, my children and I will starve because the business I am doing is from hand to mouth and I don’t make much money from it.”
Liberia’s poor are really suffering. The average annual income of Liberians (measured in gross domestic product (GDP) per person) rose slightly in 2021 to $US675 from just $595 in 2020, according to the World Bank. Even after Ebola Liberians had more income. Average income hit its peak of $722 in 2016. Despite Liberia’s resources wealth, its people are among the poorest people in the world.
Tamba feels the difference. “Five years ago, was more preferable than now because if you were making a business, there were people to buy, and people were able to pay their children’s school fees,” she says. “Schools weren’t overcharging but now if you talk about it, they will tell you if you think education is expensive, try ignorance. Everything has changed and people are everywhere crying.”
Liberia is paying a price for decades of underinvestment in “human capital” according to Dr. Tenny. He warns these crises will keep recurring until massive investments in education and health are made in the country that can fuel innovation, entrepreneurialism and job creation.
“The bottom line is, it is not only the absence of jobs but is the absence of qualified people,” he says. “Most of our people have not added value to themselves. We still have significant challenges in terms of human capital formation. But these are the people who automatically think that things will go rosy in their favor.”
The rising price of rice in particular is a worry to experts. Liberia has a bad history of political unrest following rises in the price of rice. In 1979 a proposal by Florence Chenoweth, then-Minister of Agriculture, to increase the subsidized price of rice from $US22 per l00 pound bag to $26 sparked protests that turned chaotic, ending in widespread looting of retail stores and rice warehouses. It fueled political instability that led to the coup a year later and more than two decades of conflict. The poor economy has led to protests across the region.
In Ghana, in November, more than one thousand protesters marched through the country’s capital, Accra demanding the resignation of President Nana Akufo Addo and finance minister Ken Ofori Attah for their failure to address the economic crisis.
“Nana, have mercy on us, we are hungry, we are tired,” said a market woman named Afia in an interview during the protest. She was struggling with the price of corn, the key ingredient in the “kenkey”, a Ghanaian dish, that she sells. “The high cost of maize and other foodstuff has made it impossible to continue my kenkey business and my children are starving.”
Ghana has suffered a full-blown economic recession in the last year. The prices for petrol and diesel and public transport have doubled since January. The official rate of inflation (the rise in prices of goods and services) rose to nearly 40 percent in September, and some analysts believe it is possibly as high as 98%. Bloomberg says the Ghana cedi is now the worst performing currency globally.
The situation is the same in Sierra Leone. In August violent protests over economic hardship erupted in the country’s capital Freetown resulting in violent encounters between the protesters and security agencies that led to the deaths of at least 21 protesters and six police.
Political instability has grown in Burkina Faso where there have been two coups in 8 months as armed groups seek to control the country’s gold mines and regional economic trade routes connecting other landlocked Sahel countries to the coast. The UN estimates say harvests have decreased by 50% due to climate events and the instability. Malnutrition is rising.
As the Russian invasion of Ukraine drags on and the effects of climate change get worse there is little relief in sight. Many experts predict more international financial support will be needed to slow the growing crisis.
This story was a collaboration with New Narratives as part of the Investigate Liberia project. Funding was provided by the US Embassy in Liberia. The funder had no say in the story’s content.