SBP Research Bulletin Volume 6, No. 1, May, 2010 The Impacts of Global Financial and Economic Crisis on African Economies: A Review Abiodun Elijah Obayelu * Like many other developing countries around the world, the global financial and economic crisis posed serious challenges of economic development and stability for African countries. A debate has emerged over the causes and consequences of the crisis for different economies. This paper reviews the ongoing discussions in the context of African economies and presents an anatomy of the crisis along with an analysis of the challenges, opportunities, various policy measures and fundamental lessons from it. One of the major findings is that effects and measures against the global crisis are not the same but vary from one African country to another. In all cases, the crisis has swept away firms, jobs, revenues, and livelihoods in varying degrees. The paper highlights the need for coordinated and consistent efforts to assist individual countries in mitigating the risk over the longer term. It is argued that the African countries must urgently prepare their domestic policy responses to enable them to use appropriate fiscal and monetary policies to fight recession induced by the crisis. JEL Classification: E44, E61 Keywords: financial crisis, credit crunch, economic growth 1. Introduction The term financial crisis is applied broadly to a variety of situations in which some financial institutions or assets suddenly lose a large part of their value (Wikipedia, 2009). The recent crisis, though have its origin in the developed world has greatly affected developing countries around the world (Bilal et al., 2009). The current global financial and economic crisis has been described as the worst economic setback since the Great Depression of 1929-32 (McCarthy, 2009; Adamu, 2009). It has exposed weaknesses in the functioning of the global economy and led to calls for the reform of the international financial planning. The crisis is currently leading to sudden falls in industrial production, a rapid decrease in international * Department of Agricultural Economics, University of Ibadan, Nigeria; obayelu@yahoo.com