employment opportunities are faced with a recurrent frictional unemployment (the case of African workers in the Spanish labour market is a case in point).
3. The implications of the global financial crisis on African economies
The repercussions are already affecting all economic activities, production, export of cash crops, main sources of foreign currencies for African countries, employment, the funding of the economy, households’ incomes, the budget situation and workers and people’s living conditions.
3.1 Economic and social implications
External exchanges – In the area of external exchanges, the global recession has caused a fall in the prices of raw materials exported by Africa. Due to the intensification of the crisis in the developed countries and in China, the fall in the prices of raw materials has accelerated and may annihilate all the gains made over the past few years. This fall will have several consequences including the reduction of foreign exchange reserves and export earnings, unprofitability of some oil fields and goldmines, the low funding power of some states and the cancellation or postponement of some investments in the extractive industries which heavily depend on foreign direct investments.
In South Africa, for example, exports dropped in 2008, following the fall in the prices of precious metals, one of the country’s main wealth. In Burkina Faso, the balance of the balance of payments has negatively been affected by the fall in agricultural output and the fall in cotton fibre exports. In Botswana, the production of diamond has fallen by 50% due to a 30% fall in its price in the international market. In Zambia, the 65.8% fall in the price of coal has led to a considerable fall in the reserves.
As a whole, the export and import growth rates would lose 7% and 4.7% respectively. As a result, the trade balance would deteriorate. While there was a 2.9%