Transmission of Financial Crisis: Evidence of Sub-Sahara Africa (SSA)

Tasoh Toh, Ndayishimiye Alexis, Winnie Wakarima Githui

Abstract


The world was struck by a chain of financial crisis between 2006 and 2012. In 2007, the subprime crisis began which gave way to European debt crisis in 2010. As the world tried to recover in 2009, the European debt crisis and Greece sovereign debt (2011) set in. The study investigates through descriptive techniques, correlation and regression, evidence and openings through which these crises reached and how it affected Sub-Saharan Africa. Using three indicators that include GDP growth rate, export/GDP ratio and inflation, we found statistical evidence of the financial tumor in this continent. With numerous indicators of financial crisis we could limit ourselves to the three because the data source provided us with more detailed information. We suggested that governments of African countries, multinationals and local firms should have experts that can predict and mitigate the impact of a financial crisis.

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