The Impact Of 'Currency Wars' In Oil-Exporting Africa

The Impact Of 'Currency Wars' In Oil-Exporting Africa by Dan Steinbock, EconoMonitor

Since lower oil prices typically result in depreciation of the oil exporters’ currencies, the dramatic plunge of oil prices has severe implications for sub-Saharan Africa.

After the global financial crisis, many emerging economies have coped with diminished global growth prospects by deploying direct government intervention and capital controls for competitive devaluation. In turn, advanced economies have achieved the same indirectly through low policy rates and quantitative easing (QE).

As the U.S. is recovering but Europe is amid its first ‘lost decade’ and Japan has begun its third one, the Fed is likely to hike its rates in the fall or by early 2016. Interest rates will remain zero-bound...