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East and Southern Africa battles with effects of El Niño
![East and Southern Africa battles with effects of El Niño](https://biz-file.com/c/1602/329520-700x364.jpg?2)
Southern and East Africa are identified as the most at-risk regions in sub-Saharan Africa and face ongoing pressure from El Niño effects. The onset of the worst drought in decades in 2015 and risk of floods and landslides, both thought to be exacerbated by El Niño, increases the likelihood of humanitarian crises while adding to countries' economic woes.
Threat to agriculture undermines household income and food security
Countries will continue to shoulder the economic burden of El Niño, even if the event tapers off as expected by the middle of 2016. The risk of a protracted dry period connected to a La Niña event adds to this burden. El Niño events are often followed by its sister phenomenon, La Niña, where cooling surface temperatures in the central and eastern Pacific Ocean tend to compound dry conditions in sub-Saharan Africa.
Agriculture is the main source of employment for the majority of the population across East and Southern Africa and widespread drought has precipitated a loss of income for millions of people. The agricultural crisis comes at a bad time for cash-strapped countries that must contend with lower tax receipts from a decline in agricultural production and surging costs from rising food imports. Moreover, the depreciation of many currencies - notably the South African Rand - increases the price of imports and worsens deficits in the balance of payments.
Additionally, the decline in domestic grain production and increased reliance on imported produce has caused prices to rise across the region. South African maize prices continue to reach new record highs after prices rose by 70% in 2015, while Lesotho declared a state of emergency in December 2015 following a second year of failed harvests.
Grain subsidies can ease the financial pressure caused by rising prices. However, such assistance will be difficult to maintain given the strained economic climate, thereby increasing antagonism towards governments that are seemingly failing to assist the public. Rising bread prices have sparked protests in Mozambique in the past, underlining the possibility of civil unrest across the region as the cost of food becomes unaffordable.
Poor resilience to natural hazards heightens operational challenges for investors
Businesses operating in Southern and Eastern Africa face added operational risks during the El Niño crisis due to the lack of resilience in the infrastructure network. Floods in Kenya in late 2015 affected the central business district in Nairobi, while damage to the Nairobi-Mombasa highway resulted in a 50km traffic jam. Similarly, the threat of floods in Mozambique raises concerns that the EN1 highway, a crucial north-south artery, will be rendered unpassable by flood waters for a second time in 18 months.
The risk of power shortages will rise as hydropower dams lose their generating capacity during the drought. In October 2015, all hydropower plants in Tanzania, which account for 34% of national electricity generation, were switched off. Water levels at the Kariba Dam in Zambia - the largest hydropower dam in Africa and responsible for more than half of Zambia's electricity generation - are also dropping rapidly, seriously undermining the electricity supplies for both Zambia and neighbouring Zimbabwe.
Severe power shortages will hasten the decline of the embattled mining sector, which was encumbered by electricity restrictions even before the current crisis and is struggling to remain competitive in the face of falling global prices.
Although the El Niño event is expected to wind down in mid-2016, affected countries will wrestle with its consequences - and the potential start of a La Niña event - for at least the remainder of the year. Recovery from floods adds to the burden on government budgets and undermines credit-worthiness in a period when many countries, such as South Africa and Mozambique, risk further downgrades. Meanwhile, the possibility of respite from the drought in Southern Africa grows slimmer as the wet season draws to a close. The productivity of affected countries will thus continue to be hindered by the lasting effects of extreme weather, undermining growth prospects and adding to the operational burden for investors.
About Ruth Bookbinder
Ruth Bookbinder, researcher, South Africa![](/res/img/s.gif)