Extreme drought and low commodity prices are crippling economies across southern Africa. For much of the past decade, China's rapid growth led to a massive demand for raw materials, the export of which African governments rely on for revenue. But as China's economy has slowed, global demand for those materials has plateaued, causing prices to drop. Because of their heavy dependence on commodities-based revenue, southern African governments have been among the hardest hit by low prices, especially as some producers have been forced to scale back output. As if this were not bad enough, the worst drought in more than three decades is threatening the region's food security. Together, the forces of nature and market have given southern Africa a particularly bleak economic outlook over the coming year.
In response to economic uncertainty, migration from poorer countries could increase as people seek better opportunities in the region's biggest and most stable power: South Africa. However, South Africa is poised to fare no better than its neighbors, and an influx of immigrants will only exacerbate Pretoria's existing problems, including the long-term strain on its water resources.
Commodity exporters that managed to weather the past year’s drastic decline in prices are now struggling to cope with the additional damage caused by the region's ongoing drought. Zambia's copper industry, like the rest of the country, relies on hydropower for most of its electricity needs. When power supplies to copper producers were slashed by 30 percent last summer, companies had to import more expensive energy sources to make up for the loss. Water levels at the Kariba Dam, a shared resource with Zimbabwe and Zambia's principal generator of hydroelectricity, remain dangerously low, and Zambia is working to find a contingency plan to address its growing electricity deficit. The reservoir impounded by Botswana's Gaborone Dam saw its water levels plummet to less 2 percent of its capacity in December, and authorities in both Botswana and South Africa have begun to restrict water usage.
On its own, water scarcity is rarely the driving force behind social, political and economic crises. But within the perfect storm of drought, low commodity prices and historical poverty that southern Africa is now seeing, it can easily aggravate the problems already burdening the region.
