How Ukraine war changed life in Africa

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When the Russia-Ukraine war started three years ago, ordinary people in Uganda did not imagine that it would have an impact on their lives. However, the months that followed the outbreak of the war triggered inflation in several countries, including Uganda.

According to Prof. Ahmed Hajji, a foreign policy analyst and executive director of the Centre for Policy Analysis, the war in Ukraine has contributed to Uganda's recent economic challenges, including inflation.

“The war has disrupted supply chains with manufacturers like — Mandela Millers of Mandela Group — makers of Supreme wheat flour— importing as far as Argentina, leading to higher prices and food insecurity,” he said.

Thaddeus Musoke, the chairperson of the Kampala City Traders Association, says the economic shock was felt more in fuel prices.

“The increment in the price of fuel worsened inflation. You see the price of fuel influences the price of other commodities,” he says.

The war started on February 24, 2022, and data from the Uganda Bureau of Statistics (UBOS) indicates that the months that followed saw the highest inflation in the country in over a decade. Between February and December 2022, inflation in Uganda, which was mainly imported due to high fuel prices, shot from 5% to more than 10%.

For example, in October 2022, UBOS recorded an inflation rate of 10.7%, largely due to the rise in fuel prices because of the disruptions in the international markets brought about by the war.

It should be noted that Russia, which is one of the leading producers of oil in the world came under sanctions due to its role in the war, further worsening the crisis.

In June 2022, the price of diesel and petrol in Uganda shot from the sh4,500-sh500 in 2021 to between sh6,500 and sh10,000 by July 2022.

“It was against this background that for the first time in more than a decade, Uganda had double-digit inflation. Import businesses suffered a major shock in the months that followed the war,” Musoke says.

In his New Year’s address of 2022, President Yoweri Museveni said Uganda had avoided taking sides in a that he thought should have been avoided.

“The main driver of high commodity prices and shortages of some commodities is the war in Ukraine and the sanctions that were put on Russian oil and other products by the Western countries. We have avoided taking sides in that conflict because we think it could have been avoided and we have told those involved our views in private,” Museveni said on December 31, 2022.

When fuel prices increased, the Russian foreign minister Sergey Viktorovich Lavrov, while on a visit to Uganda, offered Uganda cheap oil, but President Museveni rejected the offer and instead opted for a local solution.

Ditching Kenyan middlemen

The President decided that it was time to ditch Kenyan middlemen on which Uganda relied on to import petroleum products.

He accused Kenyan middlemen of inflating the costs to make fuel expensive in Uganda.

“Uganda imports petroleum products of the magnitude of 2.5billion litres per annum valued at about US$ 2bn. Without my knowledge, our wonderful People, were buying this huge quantity of petroleum products from middlemen in Kenya. A whole country buying from middlemen in Kenya or anywhere else!! Amazing but true. Why not buy from the refineries abroad and transport through Kenya and Tanzania, cutting out the cost created by middlemen,” Museveni stated.

Following Museveni’s statement, the energy ministry worked with international oil firm Vitol Bahrain to directly import its first consignment of petroleum products from the high seas on July 3, 2024.

It is such interventions coupled with tight monetary policy from Uganda’s Central Bank helped to shield Uganda from imported inflation that would have come with the trade disruptions resulting from the Ukraine-Russia war. As a result, Ugandans now enjoy relatively low fuel prices between sh5500 and sh6,000.

“The prices have reduced, but not to the pre-2022 levels before the start of the war. We are still feeling the pinch of fuel prices. We still need the Government to reduce it since it is now the main supplier to local distributors,” Musoke says.

Even wheat, whose price sharply increased at the start of the war has stabilised, according to Hatma Nalugwa, who runs a catering and confectionaries business in Kampala.

“The war did not affect us wheat. The price of a 2kg packet of wheat flour has reduced from sh8500 to sh6500,” Nalugwa says.

Although Uganda grows wheat in areas like Kapchorwa, Kabale, Kisoro, Kabalore, Kasese, Bushenyi and Mbarara, it mainly relies on imports because the amount grown is not enough to meet the market demand.  Before the start of the war, most of Uganda's wheat imports were from Russia and Ukraine.

The year ((2021) before the war, Uganda's wheat imports from Ukraine stood at 92,131 tonnes worth $30m (about sh100b) while those from Russia were 149,821 tonnes worth $42m (about sh150b). All imports were 671,848 tonnes valued at $198m (about sh700b).
In 2022, the year the war commenced, imports from Ukraine dropped to 45,477 tonnes valued at $17m (sh60b) while those from Russia were 145,452 tonnes valued at $58m (sh200b).

Street food

This was the year when Russian war ships blocked the shipment of more than 20 million tonnes of grains from Ukraine. This disrupted exports, leading to the rise of chappatis and rolex street food in Uganda.

Before the war started, the average price of rolex (combination of omlette and chappati) in Kampala was sh1,500. Three years down the road, the average price has risen to sh2,000, largely due to the sudden increase in the price of wheat and other ingredients.
Michael Luwemba, a chappati maker in Ntawo ward, Mukono municipality, says the price increment was because of the inflation of 2022.

"Some people reduced the size of chappatis while others just increased the price. We used to buy a 2kg packet at sh6,000, but this increased to sh8500. It later reduced, but the price of rolex did not reduce," he says.
Luwemba says the price increment made them lose customers in the beginning, but slowly they returned and have accepted to pay the new price.
Robert Kisolo, who runs a wholesale shop in Mukono town, says prices of several commodities such as cooking oil,bread, confectionaries, among others, increased in the first months of the Russia-Ukraine war but later reduced following a drop in fuel prices
"The prices increased, but later stabilised. We have been stable for about a year. When oil stabilises, everything follows suit," he says.

Innovation

Musoke says the war made Uganda innovate in terms of import substitution.

“But we became innovative and found solutions. We did import substitution while other importers changed supply lines and sources. For example, I now eat cassava instead of bread,” he said.

Africa’s international standing

Joseph Ochieno, a senior member of the Uganda People’s Congress and a policy analyst, says Africa’s reaction to the war shocked the West.

First, the continent tried to play a peace broker role when South African President Cyril Ramaphosa, Uganda’s former prime minister Ruhakana Rugunda flew to Europe to try to broker peace.

“First, I did not think that Russia would have the audacity to go this far. Honestly, the war is senseless.  Second, it was difficult for the West to persuade Africa to take its position on Ukraine because of the imperialism history that African had with the West. Russia, on the other hand supported African liberation movements against colonial powers in the West. So there is a history to it. But I think the war is senseless and should come to an end,” he says.

Ochieno further says the conflict exposed Africa’s lack of self-reliance on food, especially grains.

“It was shocking to learn that some countries were net importers of wheat from Ukraine and Russia. The continent should have come up with measure to ensure that this dependency on the rest of the world ends. I have waited for an African country to announce how it was going to stop grain imports, but none has come up. Honestly, this should have been a wakeup call.”

Angello Izama, a political strategist, says Africa’s reaction towards the war says the war exposed the ideological divisions or contradictions among Western countries and projected Africa’s neutral stance in the West-East fight.

“At the start of the war, the West tried to get everyone on its side, but got disappointed when most African countries decided to go the neutral path yet the West wanted to get everyone to their side, with neutrality being viewed as complicity. In the end many African countries chose neutrality against the wishes of the West,” he says.

Izama says the biggest contradiction has been from the US which strongly supported Ukraine has now switched sides to support Russia after the coming of Donald Trump into power, leaving other NATO members in the cold.

He says the conflict also showed that the UN no longer welds power it used to have in resolving global conflicts.

“You have Russia and US determining the future of the conflict and not the UN. You even have the UN being called a terrorist by Israel in Gaza conflicts. Gone are the days when Koffi Annan would speak and people listen. Countries are now pursuing multi-lateralism,” he says.