It is evident that the global economy is experiencing a major slowdown owing primarily to the worst financial crisis since the great depression. Stock markets have become increasingly volatile, some major financial institutions in advanced economies have collapsed, capital flows to emerging markets have weakened and some currencies have depreciated sharply.

The global financial system is facing turbulent times, and the international financial markets are uncertain, and volatility continues in the world market.

Governments have taken unprecedented measures to address these problems. Despite this, international financial markets are still marked by a high degree of uncertainty and risks of a global recession are high. The International Monetary Fund in October 2008 marked down its growth projections of the global economy for 2009 to 3.0 percent and the outlook is subject to considerable downside risks.

Well, the multi-million dollar question now is how will the global financial crisis affect the world, Africa in general and developing countries in particular.

The Gambia, according to Mr Moussa Gibril Bala-Gaye, Secretary of State for Finance and Economic Affairs, cannot ascertain exactly for now the details of the impact of the world financial crisis, the credit crunch, and rising food prices on our economy, and people.

Mr Gaye, who presented before Members of the National Assembly, Estimates of Revenues, Recurrent and Development Expenditures of the government of the Gambia for the fiscal year 2009 last Friday, said the Gambia economy has performed magnificently, but serious challenges from outside have started to emerge in 2008, and the situation may continue into 2009.

The budget, which runs across all sectors of the economy, highlighted key primary areas ranging from Education, Health, Agriculture and Communication with particular emphasis on poverty eradication.

“We have seen the value of our imports drop, and so our revenues on non-oil imports. All we know is that remittances, tourism receipts, foreign direct investment, and aid flows may be affected. Some challenges have already emerged, and, perhaps, more formidable challenges may come sooner than later”, he said.

For Mr Gaye, the current financial crisis seems to be more severe, and we are seeing a tsunami of credit crunch in the United States, Europe and some parts of Asia, where banks cannot extend credit even to each other.

“As the Gambia globalises, and integrates more with the world markets, we will be affected directly or indirectly in terms of Remittances from abroad, Aid flows, Foreign Direct Investment, and Tourism Receipts”, he said.

He was however quick to add that government will take the necessary policy response to dampen the impact of these on the Gambian people. “More importantly, Government will continue to monitor closely the situation, and ensure that deposits and savings are safe through tightened bank supervision, and monitoring of potential risks, and also ensure more transparency, accountability, and oversight functions in our financial system”.

He added, “The Gambian people have made great sacrifices in the recent past, and overcame great difficulties, when the country was left on its own to manage its own survival and development. And as a country, we succeeded magnificently”.