The Dag Hammarskjöld Scholarship Fund for Journalists

WATCHING developed countries like UK and USA struggle to calm the turbulence in the financial markets, you get a feeling it will not be long before developing or least developed countries are hit by the economic virus.

If people thought the financial crisis was far away in Europe, America and Asia they are wrong. It is as much a threat to Africa and other developing countries as it is to Europe.

Already the Oil producing companies are feeling it. As major economies such as America,Europe and Asia slow down so has the demand for oil.

This has led to the drop in oil prices, dipping below 62 dollars a barrel!

And just think of the Chinese and or Indian economy slowing down! That means trouble for African countries like Zambia it will mean less demand for products like copper etc.

For Zambia everyone remembers how in 1973 a massive increase in the price of oil and a slump in copper prices in 1975, led to extreme trouble for the economy.

By 1976, the country had serious Balance of payment problems and became heavily indebted to the IMF.

Is that likely to happen? Maybe may be not but if metal prices drop then it is more problems for economies that rely on mineral exports.

That could be one of the major trickle down effects of the economic melt down in developed countries; low demand and low prices for products that drive economies for many developing countries.

Andof course cut backs on Foreign Direct Investment. If multinational companies cannot find the money they can not invest in Africa or other developing countries.

While that maybe mainly on the economic side the social side also faces major threats particularly in the area of meeting Millennium development goals MDGs. 

UN secretary General Ban Ki-Moon’s  fears  are justified  ‘We cannot allow the financial crisis to force millions of people back into extreme poverty.’

Chances are that without much effort the exact opposite will happen; millions of people back into poverty.

Like Mr Ban says many developing nations lack the resources to rescue financial institutions in emergencies like the wealthier nations have done.

Although it is generally agreed that half way through MDGs many countries in Africa are lagging in the achievement of these goals, it is also not debatable that progress in eradicating extreme poverty and hunger, in improving global health and combating the scourge of disease has been made. But all this is under threat.

Let’s face it, even without the financial crisis it has been a hustle to force some developed countries to honour their pledges made at the Gleneagles summit in 2005.

It is a fact for instance that only five developed countries are giving aid to Africa at agreed levels towards the MDGS.

Developed countries had pledged to give 0.7 percent of their Gross Domestic Product as official development aid to Africa towards achieving MDGs and this is not happening.

I would bet on most of the fears coming true if the global economy worsens; more protectionist measures that will further block goods from developing countries to enter the developed market, no commitments to commitments made to help over come problems in least developed countries and many others.

You can see the pressure on Governments like America by the citizens.

In Americathe economic situation is now deciding who gets the Presidency.

Does anyone ever think some poor developing country will come first ?

Maybe commitments on issues such as malaria that are mainly coming from philanthropists and a few governments may come true, there we have a bit of hope and only just.

Time has come for African leaders to start having meetings on how they will address the problems if it takes its toll on the continent.

Least developed countries cannot afford to rely so much on the troubled developed economies.

They have defaulted on their pledges in the past what of now when they have a real and genuine excuse to do so?

Ends.