Economy

African economies are particularly vulnerable to the impacts of war in Ukraine, says IMF Chief Kristalina Georgieva. The remarks come two weeks after the Russian invasion of Ukraine sent financial markets into steady decline, leaving African economies with high food and fuel prices. “The war and the unprecedented sanctions imposed on Russia are having far-reaching consequences. They come at a delicate time for Africa.”, she stated at a closed virtual press briefing on Thursday.

In addition to the moves towards UnionPay, some Russian companies are now accepting payments in Yuan, and there is talk of Russia turning to CIPS, the Chinese equivalent of SWIFT. The Russian pivot towards the Yuan and Chinese financial systems could reduce the dominance of the US Dollar in global transactions. In addition to the moves towards UnionPay, some Russian companies are now accepting payments in Yuan, and there is talk of Russia turning to CIPS, the Chinese equivalent of SWIFT. The Russian pivot towards the Yuan and Chinese financial systems could reduce the dominance of the US Dollar in global transactions.

The impact of the sanctions on the Russian aviation sector is having far-reaching consequences for countries in Central Asia. Millions of people from Central Asia are in Russia as migrant workers and the disruption in aviation is making their travel back to their home countries difficult. Among them are 2.2 million Uzbeks who live and work in Russia. Remittances from Uzbek migrants in Russia constitute 12% of Uzbekistan's National GDP. Regular flights from Russia to Uzbekistan have been cancelled, Smartavia and iFly, two Russian carriers, have suspended all flights to Uzbekistan and flights that are still operating have more than doubled in price. As an aviation specialist for Uzbekistan said, “After the sanctions, not a single such aircraft landed on the territory of Uzbekistan. The reason is very simple - they remained uninsured.” Uninsured aircraft are prohibited from flying. Millions of migrants are now left without a crucial air bridge to their homeland. International sanctions on finance are already causing currency crises in Kazakhstan and Kyrgyzstan. The impact of sanctions on the aviation sector further highlights the cost of Russian actions in the Central Asian region.

Saudi Arabia's Crown Prince Mohammed bin Salman announced the transfer of 4 percent of the Saudi oil giant Aramco’s, shares to the Public Investment Fund, the Saudi sovereign wealth fund. The transferred share are valued up to $80 billion. The move is another step by the Kingdom to diversify the economy and move it away from dependency on oil.