Tuesday, October 14, 2008

The Credit Crisis Will it Reach Africa?

Reuters has a great wide ranging analysis on the credit crisis. The article compiles different viewpoints and opinions on how it will effect Africa.

One side is of the opinion that it will not hurt Africa much because banking systems are under developed in the continent. The other side says the monies being used to bail out banks will cause cut backs in aid.

Writer Pascal Fletcher has within this story a breakdown from Oxfam on how the $700 billion dollars could have been used to help Africa. The $700 billion dollar figure is the amount that the US government used to bail out the banking system here in the states.

from Reuters

Oxfam GB has drawn up figures showing just how far $700 billion earmarked by the U.S government for a financial rescue plan could go in helping to solve the poor world's problems.

It says this is enough to eradicate all world poverty for over two years, based on a United Nations Development Programme (UNDP) calculation that it would take $300 billion to get the entire global population over the $1 a day poverty line.

The $700 billion could clear -- almost twice over -- the $375 billion accumulated debt of the world's 49 poorest nations.

According to Oxfam, the U.S. bailout figure is worth about 7 years of annual global aid levels ($104 billion in 2007).

The United States is also planning to inject $250 billion into its banks following European rescue pledges totalling more than $1.3 trillion.

1 comment:

Literacy 'n' Poverty Project said...

I believe this global economic crisis will affect Africa largely due to a decrease in aid and possibly volunteer support. The Millennium Development Goals are not getting nearly as much attention as they deserve and VP candidate Joe Biden mentioned in the VP debate that one area we may need to cut back on is foreign aid.

In addition to low funding, with Americans and others abroad losing jobs and their houses at an alarming rate, it may not be feasible for volunteers to go abroad. Sponsorship will help but when you get sponsored by companies that are having their own crisis, where does that leave you?

Regardless, I and my organization plan to do as much as we can to support our fellow brothers and siters in Africa and around the world.

"Be the change you want to see in the world."

Chanelle Carver
Literacy 'n' Poverty Project