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Published On: Sat, Aug 6th, 2022

Russia-Ukraine war threatens this year’s foreseen strong recovery-says CBG

By Our Correspondent 

The Governor of the Central Bank of the Gambia, Mr. Buah Saidy has disclosed that as they are at a crossroads in their quest for development and having started recovery from the Covid-19 Pandemic, their economies were again beset by another major external shock emanating from the Russia-Ukraine war, with the strong recovery anticipated this year being threatened by the adverse effects of the war.

 That latest forecast by the International Monetary Fund (IMF) painted a gloomy picture of the prospects of the global economy and downgraded its growth forecast to 3.2 percent for this year compared to 6.1 percent a year ago.

The Central Bank Governor made these disclosure on Thursday at the opening of the 44 Ordinary Meeting of the Assembly of Governors, organized by the Association of African Central Banks (AACB) held at the Sir Dawda Kairaba Jawara’s International Conference Centre in Bilijo.

The theme for this meeting, “Digital Innovations and the Future of the Financial Sector: Opportunities and Challenges for Central Bank Digital Currencies,” as quite suitable, as African countries look forward to adopting a single currency and a common Central Bank in Africa.

Governor Saidy it’s evident that low-income countries are bearing the brunt of the economic consequences of the shocks through sharp increase in the cost of living, debt sustainability challenges and rising external vulnerabilities.

He lamented that as the world gets more fragmented due to conflicts that are not their making, their efforts to confront and address climate change are diminishing, that global concerted efforts are needed to tackle climate change, adding that if the world fails to step up now, millions of people in this part of the world would be pushed into extreme poverty.

He said despite the fact that Africa is contributing the least to global warming, they are the most-exposed and disproportionately affected by the dreadful impact of climate-change. 

He recalled that the Gambia has few days ago experienced a record of 30 hours torrential rainfall that caused severe flooding, devastated communities, and resulted to loss of lives and property, pointing out that the world must act now and that the Central Banks have a role to play in this regard, because climate-related risks have economic and financial stability implications.

Saidy outlined that Since the food crisis of 2006 that affected some countries in Africa, they have continued to witness major external shocks, including the financial and economic crisis of 2008/9, the commodities crises of 2014, the COVID-19 pandemic and now the Russia-Ukraine war.

He said while the crises cited have devastating consequences on their economies, they provide lessons and opportunities to consolidate African Solidarity, adhere to multilateralism and shift global markets towards Africa.

However, he said they have everything in their arsenal to build economies that are robust and resilient, improve food self-sufficiency and disaster preparedness and reduce dependence on other parts of the world for survival.

He concluded that improving financial inclusion that ensures that everyone is carried along is crucial and technological innovation is the engine in this regard which guided the decision by the CBG and
Government of The Gambia to develop a National Financial Inclusion Strategy, which comprehensively outlines their strategy to accelerate financial inclusion in The Gambia, which focuses to leverage on existing technologies to expand access, to finance the low-income or less privileged and vulnerable segment of the population.

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