The Euro Zone Economic Crisis and Sub-Saharan Africa’s Real Economy: Analysis and the Way Forward

Abstract

The purpose of the paper was to investigate if there were some negative impact of the euro zone economic crisis on sub-Saharan Africa’s (SSA) real economy. The evidence revealed that the euro zone crisis had affected sub-Saharan Africa economy in terms of trade, development assistance, and remittance. The conclusion derived from the evidence is that SSA’s economic growth was negatively affected slightly. This was due to prudential policies implemented by SSA policy-makers. The article begins with the historical background of the euro zone economic crisis and its root causes. It then provides an analysis of the transmission channels of the crisis and its impact on SSA’s economies. This is followed by a discussion of the policy responses to the crisis by SSA’s policy-makers. The paper concludes with an analysis of SSA’s recent economic performance and the way forward for long term growth and sustainable development.