Leaders in Burkina Faso face a serious quandary this week, as unions threaten a general strike on Tuesday and Wednesday to protest against the rising cost of living.
In February, riots erupted in towns across the country, and more than 300 people were arrested, leading the government to lower tariffs on imports of basic foodstuffs. Unions demanded further measures to reduce food prices, as well as a public sector wage increase, at marches in early March.
Soaring commodity prices
Burkina Faso is not alone: many of its neighbours in the Sahelian region of West Africa -- and elsewhere in Africa and beyond -- are facing difficulty over the rising cost of living, due to soaring commodity prices:
- In November, Mauritania saw violent protests over sharp rises in food prices. Demonstrations also rocked Senegal's capital Dakar, prompting the president to trim the size of the cabinet in 'solidarity' with the suffering of the people.
- Mozambique rolled back diesel fuel price increases after demonstrations left six dead and over 100 wounded.
- Fuel price protests fed into other political unrest in Cameroon in late February, leading to urban riots, which claimed dozens of lives. The government then raised public sector salaries, and suspended tariffs on fish, cooking oil and rice.
- Ivory Coast's government reduced tariffs on food imports on April 1, after one person died in food price protests in Abidjan.
Africa is not unique in being affected by rising costs of living, but food price rises are hitting the region particularly hard. The IMF last economic outlook suggests that food prices contribute most to headline inflation in Africa at 60%, compared to 18% in the OECD countries. Asia (56%) and the Middle East (52%) are also strongly affected.
African governments are also constrained in their ability to react to price increases, either to cushion the blow to the poor, or to stimulate increased production:
- While Argentina, India and Indonesia are making headlines for blocking exports of key food commodities or raising export tariffs, the African reaction has been to cut import tariffs. This move reflects the fact that in many African countries, much agricultural production is at the subsistence level, so only limited amounts make it into the market. Even where it does, poor infrastructure often prevents its efficient use domestically or for export.
- Restricting exports and lowering import barriers have different effects on the market -- the former create market-distorting disincentives preventing producers from benefiting from higher prices, while the latter arguably ease free trade. However, they both put a fiscal strain on the government from lost revenues. For most African countries, this impossible to maintain without aid.
With no end in sight for the commodity price boom, the political backlash in the region can be expected to continue for the foreseeable future.