As the Chinese face economic slowdown there are growing concerns over its effects on West African countries.
The slowdown in the world’s most populous country is expected to cause a substantial decline in demand for world commodities like gold, cocoa and crude oil.
Most West African countries including Ghana, Ivory Coast and Nigeria earn most of their revenues from trading with China.
Ghana for example has most of its non-traditional exports from Ghana to the Chinese market.
Already, Ghana and most of the African countries have been affected by the general decline in the prices of international commodities .Ghana and Nigeria have had their share of decline in oil prices affecting the returns from oil revenue.
Weak currencies
The Nigerian Naira and the Ghana cedi have in recent times suffered depreciation against major trading currencies such as the US dollar, British pound and the Euro.
With the slowdown in China’s economy, this development is expected to have some rippling effect on most West African countries since the dollar earnings might drop, considering the decline in prices and demand of exports.
Meanwhile, the Government of Ghana has indicated it will revise its revenue projections from crude oil exports.
Ghana’s Finance Minister, Seth Terkper, in a supplementary budget to parliament revised the crude oil revenue from 4.8 billion Ghana cedis to 1.8 billion Ghana when the price of a barrel of the commodity was 52 dollars.
With crude oil prices dropping beyond about 40 dollars per barrel, most West Africans oil producing countries may to have to change their projections.
