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In the wake of the global economic and financial crisis, experts and analysts agreed that the initial effects on African financial sectors would be minimal because of the limited exposure to the international financial markets. However, African countries are more integrated than before with the world economy through the following transmission channels: international trade, foreign direct and portfolio investments, foreign aid flows, private remittances, and tourism; and since they are predominantly primary commodity exporters, their economies was negatively affected by the recession in many developed countries due to the sharp decline in world demand for commodities and in their prices. This paper takes the view that African countries were more susceptible to external shocks than other developing regions of the world because of their flawed macroeconomic fundamentals, but more importantly, the transmission channels emphasize the extent of the region's vulnerabilities. [ABSTRACT FROM AUTHOR]

Assesses the effects of trade polices, exports and investment rates on economic growth in sub-Saharan African (SSA) countries, using a vector error correction model (VECM). How economic growth can be stimulated; Impact of investment rate shocks on economic growth; Definition of economic growth.

This paper examines the relative importance of monetary and fiscal policies in ten African countries using a trivariate vector autoregressive (VAR) model. The analysis is undertaken with annual data from 1960 to 1990 in logarithms first difference form. In five of the ten countries, our empirical results support the monetarist position that monetary policy is more important than fiscal policy. On the other hand, the Keynesian position that fiscal policy is more important than monetary policy is confirmed in the other five countries of the sample. The results of this study suggest that a particular economic philosophy cannot be generalized for African countries. These results may therefore prove useful not only to policy-makers but also to those interested in building macroeconomic models which may have implications for aggregate-demand management. [ABSTRACT FROM AUTHOR]