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Africa Recovery / afrol News, 4 November - Beyond the dozens of Africans believed to have been killed in the 11 September terrorist attack on New York's World Trade Centre, thousands more will soon perish as the economic shockwaves reach the African continent. According to the World Bank, an additional 20-40,000 children under five could die worldwide because of a more severe global economic downturn and worsening poverty. About half those deaths will likely be in Africa. World Bank President James Wolfensohn noted on 1 October that the economic aftermath of the attack will exact "another human toll that is largely unseen and one that will be felt in all parts of the developing world, especially Africa." World Bank economists estimate that economic growth in developing countries overall will be lower by 0.5-0.75 per cent in 2002 than was projected before the attack. Although they do not have specific regional estimates, they believe that Africa will be "worst hit." The UN Department of Economic and Social Affairs, in an updated forecast issued on 10 October, believes that developing country growth in 2002 will not exceed 4.25 per cent, down a full percentage point from its earlier estimate of 5.25 per cent. For Africa specifically, the forecast has been revised from 4.25 per cent to 3 per cent, only slightly above the continent's population growth rate. Africa will feel the effects of 11 September in different ways. Slower growth in the US and other industrialized countries will lower demand for exports from all developing regions. Commodity prices for African exports were previously forecast to fall in 2001 by an average 7.4 per cent from last year, and now will likely drop further. Because of greater insecurity, trade insurance and transport costs are simultaneously being pushed upward. In addition, the worldwide decline in tourism will bring serious losses to a sector that accounts for 10 per cent of the continent's export receipts. As a result of these combined effects, the number of Africans living in poverty, according to the World Bank, will probably increase by 2 million more than would otherwise have been the case, while another 2-3 million will be driven deeper into poverty. It is not clear how world oil prices will be affected by the war in Central Asia. A few weeks after the 11 September attack, oil was about $5 per barrel cheaper than before. This depressed the earnings of Africa's major oil exporters (including Nigeria, Algeria and Gabon), but helped Africa's many poor oil-importers by lowering their costs. However, if the war is prolonged or political instability spreads to some of the major Middle East exporters, oil prices could again be pushed upward, reversing the effects in Africa. Because of Africa's additional economic difficulties, combined with a likely decline in private capital flows due to reduced investor confidence, the World Bank urges a significant boost in foreign aid to the poorest countries of Africa and other regions. This is not very likely to happen, however. Just before the attack, the World Economic Outlook of the International Monetary Fund projected an additional 7.1 per cent fall in aid to Africa in 2002, after several years of decline. The need for massive humanitarian assistance in Afghanistan and neighbouring countries will place even more strain on available donor resources. By Africa Recovery, United Nations.
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