By: Abdoulie Njie (Chairman KS Global Group)
Russia is the world’s second-largest producer of natural gas and one of the world’s largest oil-producing nations, exporting 197.2 billion cubic meters of pipeline gas in 2020.
Russia and Ukraine are also leading exporters of grains, metals, wood and plastics, all used worldwide in a range of products and by a multitude of industries from steelmakers to car manufacturers. Together both countries make up nearly 30% of global wheat exports.
Because of how much both countries produce their conflict will have a substantial impact on the global economy and financial markets, with significant spill over effect on other countries including The Gambia.
Effect on The Gambia
Unfortunately, the conflict comes at a moment when The Gambia like many other countries is on the verge of economic recovery following the COVID-19 pandemic.
As bad as things already are Gambians especially those struggling to feed their families will now get to experience a dramatic rise in the price of basic food commodities as a result of disruption in the global supply chain and economic sanctions on Russia.
The average Gambian is bound to be affected because goods such as eggs, cheese, chicken, sunflower oil and all other products made from wheat come mostly from Ukraine. It is important to emphasise that Ukraine and Russia collectively produce 30% of wheat the world uses.
Since they are a major exporter of crude oil the conflict (as we have already seen) will lead to a rise in price. The rise in fuel price will have a trickledown effect on all other goods. Fuel price increase means higher transport cost, which means higher price of commodities since transportation cost will factor into the price of the goods.
What Should The Gambia Government Do?
As a businessman with vast experience in the sector, I would encourage our government to be proactive in its effort to mitigate the potential effects associated with this crisis. Being proactive starts with wide consultations from stakeholders in the business sector, these include the business community, importers, traders, private and public financial institutions and international partners.
These consultations will bring about a unified solution and will go a long way in guaranteeing food security until things get to normal. The Government should also consider subsidies on essential commodities, cutting taxes on goods that are directly affected by the crisis can also go a long way to cushion the effects of the crisis.
Nonetheless, I strongly believe that government must take a tough stand against businesspeople who might want to hike prices or hoard goods.
Appeal To Businessmen
We all know food shortage or price increases could stroke social unrest. Therefore, I wish to use this opportunity to appeal to fellow businessmen to show the highest form of compassion and humanity towards the Gambian people and not take this as an opportunity to rob the Gambian consumers when the anticipated effects intensify.