1. Why were the two oil crises in the 1970s so devastating for the African economies? () They increased the costs for oil imports, at the same time as the international prices for other natural resources dropped and government revenues plunged. ( Increasing oil prices and limited oil imports put a stop to on-going industrialization efforts. () Many African countries were oil producers and during the crises they lost their export markets and thereby their export incomes. 2. Which African countries were the most severely hit in terms of loss in economic growth (GDP per capita) due to the oil crises? South Africa - the most industrialized country. O Botswana with a high value mineral (diamonds) and good institutions. O Nigeria - an oil producer. ) Ghana and Kenya - exporters of agricultural products. 3. Which three statements about the repercussions after the oil crises are correct? Developing countries' inability to pay even the rents of their large loans eventually lead to the debt crisis in the early 1980s. The African countries responded to the oil crisis by sliming the size of the public sector and halting all major development projects. Differently from Africa, the developing countries in Latin America voided the debts crisis. With the whole world going through an economic crisis at the same time, there was no available capital to borrow. O)To compensate for the loss in export revenues, African states borrowed from international banks rich on so called 'petro-dollars" O) Because of poor agricultural productivity almost all African countries were food importers and with declining export incomes lending was necessary to buy food