Within a month of Samsung and other companies slashing mobile phone production at factories in coastal China´s last December, cobalt mines were closing in the Democratic Republic of Congo at the cost of thousands of jobs.

China suspended orders for the metal used in mobile phone batteries, prices slipped to $14 a pound from $49 a year before and the Chinese traders who kept the production chain moving from one side of the world to the other melted away.

For most of the commodity exports that provide the lifeblood of sub-Saharan African economies, the story has been similar. When demand was rising simultaneously in Asia, Europe and the Americas, African revenues surged. But the same expanding trade ties that have helped spur the longest period of economic growth on the continent for generations, have transmitted the withering effects of the global slump just as efficiently.

Today many of sub-Saharan Africa´s 47 states are seeing their incomes evaporate, leaving holes in national budgets and foreign reserves as wide as the pits from which their resources have been extracted.

Without urgent measures to limit the damage, fragile recent development gains could be swept away, conflicts will reignite and more states will fail, warns Meles Zenawi, Ethiopia´s prime minister, who is representing Africa at today´s summit of the Group of 20 nations in London.

"The recovery was ... at a very early stage of paying dividends," he said in an interview with the FT. "That is one of the biggest tragedies. Africa was beginning to stand up and now it is being knocked down again by a crisis which is not of Africa´s making."

The speed with which the downturn is now taking hold is dramatic. Average growth is expected to dip to about 2.5 per cent, below population increases for the first time in a decade.

The African Development Bank (AfDB) estimates that export revenues will decline by 40 per cent this year for the continent as a whole, leading to shortfalls of $251bn in 2009 and $277bn in 2010 with oil exporters suffering the biggest losses.

Capital inflows, tourism receipts and remittances are all declining in parallel, and trade financing is drying up. Foreign reserves in the worst hit countries, among them Congo, are down to only a few weeks of import cover. Nor is it only the mineral and oil rich that are under pressure.

In past global downturns, the severity of the impact on Africa varied considerably from state to state. This downturn is washing up on all of the continent´s shores, cramping both the formal and informal sectors as currencies lose value, the cost of imports rise, and living standards fall. As the big engines of regional growth have slowed - South Africa in the south, Nigeria in the west, and Kenya in the east - the contagion has spread to poorer countries in the landlocked interior.

Economists, investment analysts and policymakers were all slow to see this coming. Until late last year, many believed that the poorest continent would escape relatively unscathed from the gathering storms. This was partly because African banks were not exposed to the toxic assets eating away at Wall Street and the City of London.

It also resulted from the belief that the continent´s strengthening economic performance has been the result of interwoven trends, not just the commodity boom. These included improved macro-economic management in most countries, rising domestic demand for goods and services, and increased investment in social and physical infrastructure.

As the recovery gathered pace, a steady stream of African professionals working abroad had begun to return to jobs back home, raising the prospect that a chronic skills shortage might begin to ease. In parallel, capital flight which has robbed the continent of hundreds of billions of dollars over the decades, showed signs of slowing. More African money, ill-gotten gains included, was being invested at home as local stock markets soared and a wider range of businesses became viable.

Nevertheless, it now seems painfully obvious just how vulnerable this emerging recovery was likely to be, given its roots in world trade and a relatively narrow base of exports.

"The notion that, because you don´t have a large financial market your banks are not in trouble appears to have allowed some analysts to push the question of Africa on to the back burner," says Trevor Manuel, South Africa´s finance minister, adding that: "Whereas generally in large parts of the G7 [industrialised nations] it is the financial markets spilling over into the real economy, everywhere else it is the real economy spilling over into the financial markets."

In Africa this is blunting another promising by-product of resurgent growth. The expansion of banks from Nigeria, South Africa and, among others, Kenya had begun to transform the financial landscape, spreading their reach both regionally and into business sectors as well as parts of society that were previously un-banked.

Credit lines from Europe are seizing up, trade financing has become punitively expensive, and a source of longer-term funds that was just opening to Africa´s larger economies as the crisis hit, the international bond market, is also closing its doors.

In recent months, Ghana has cancelled a $300m bond issue. Kenya, Tanzania and Uganda have all shelved planned eurobond debuts and Nigeria has postponed issuing a naira-denominated bond. Mr Manuel says this is because of the huge borrowing demands of the rich world which alongside, shifting perceptions of risk, are pricing African and other developing countries out of the markets.

China, whose expanding trading relationship with Africa has played a big part in reviving confidence in the continent´s future, appears committed to continued investment in infrastructure and other projects in return for access to African minerals oil and other resources. But with a balance of payment crisis looming in many states, African leaders are turning to a more traditional source of income: western aid.

The AfDB estimates that, to offset the combined impact of the crisis and sustain growth would require an injection of at least $50bn this year, and more next, on top of existing aid flows. To accelerate progress towards eradicating poverty in line with the Millennium Development Goals set for 2015 would require more than twice that.

The sums involved would mark a big leap from existing levels of aid. But as Mr Zenawi will argue at the G20 meeting, to rescue an entire continent will still cost less than resuscitating some individual banks, and for Africa it is a matter of life and death. Brendan Cox, the Africa adviser to Gordon Brown, Britain´s prime minister, expressed confidence ahead of today´s meeting that a substantial stimulus package for the developing world will be made available, largely through the World Bank and International Monetary Fund.

But Donald Kaberuka, president of the AfDB, fears that this will come with so many conditions attached that the continent will be in financial ruin by the time the money is disbursed. He and other African leaders are pushing for more flexibility in the way multilateral institutions manage their resources, and more equal global representation on their boards.

It is an emerging irony of the crisis of confidence in global financial architecture: African countries which spent years being told how to manage their economies by the World Bank and IMF, are now at the forefront of those arguing for those institutions themselves to be reformed.

When the credit crisis began to destroy some of the most venerable names on Wall Street, African bankers assumed that their relative isolation from the global financial system would prove their salvation.

As recession tightens its grip on the rich world, last summer´s optimism is giving way to a queasy feeling that the knock-on effects could put some weaker African lenders in danger.

The continent´s banks avoided dabbling in the complex derivatives that proved the undoing of many of many western counterparts and most are better capitalised, but weaker growth at home is still likely to blunt new business and increase bad loans.

How well African banks can cope will be critical for the continent´s long-term prospects. A period of rapid growth in size, sophistication and regional reach among banks in Nigeria and Kenya, coupled with an aggressive push into new markets by dominant operators in South Africa, had begun to transform the financial landscape.

For the first time since independence, banks seemed as if they might be capable of channelling income from raw materials into the manufacturing and service industries needed to haul the continent off the lowest rung of the development ladder.

Nowhere was the story more compelling than in Nigeria, where a consolidation exercise launched five years ago created a vanguard of banks with global ambitions.

But it is in Nigeria, sub-Saharan Africa´s second biggest economy, that signs of distress in the banking system are most acute. The biggest concerns centre on banks´ exposure to the stock market, which has lost more than 60 per cent of its capitalisation in the past year.

Nigeria´s regulators have painted the decline as the inevitable result of the global turmoil, identifying foreign investors who rushed for the exit at the height of the credit crunch as the main culprits.

However, many in the Lagos financial community say the liquidity problems are very much home-grown. Banks were allowed to rack up huge loans for share purchases, estimated at N900bn. A lack of disclosure has made it difficult to tell which banks suffered most when the market collapsed, eroding confidence throughout the system.

"I would say that the bulk of the problems that we are facing are self-inflicted," says Lamido Sanusi, chief executive of First Bank, Nigeria´s largest by market capitalisation.

"There were certainly lapses in regulation, there were certainly lapses in risk management."

The government of President Umaru Yar´Adua has backed the recommendations of a special economic committee to impose greater levels of transparency, although questions remain over how far such measures will be implemented. Chukwuma Soludo, governor of the Central Bank of Nigeria, has dismissed calls from foreign investors for greater transparency, pointing out that reporting guidelines used in the west did little to stave off the financial crisis..

"Precisely the countries that are the champions of these principles and concepts are the ones that are worst hit," he told the FT last month. "How much did we know about Lehman Brothers before it collapsed?"

As they lick their wounds, banks in Nigeria are likely to face further blows from the impact of falling commodity prices. Lower oil prices are likely to hurt Nigeria´s growth this year. Tanzanian producers are wincing from the pain caused by lower income from cotton.

Emmanuel Tumusiime-Mutebile, governor of Uganda´s central bank, says his country´s banks are well capitalised, though weaker demand for exports could start to generate non-performing loans.

"The financial sector is still OK because the banks were not exposed to the toxic assets that caused the problems in the US," he says. "If export figures are affected, there might be a rise in NPLs, but we´re not seeing it yet."

Banks that rushed into Africa´s virgin retail market may also find first-time borrowers struggling to keep up payments on the mortgages, car loans and other types of consumer credit that are still a novelty in much of the region.

Many currencies have come under pressure, prompting depositors to shift assets out of local accounts and into dollars. "Across the region, banks last year were very bullish in dishing out credit to consumers on the back of high employment," says Richard Etemesi, chief executive of Standard Chartered in Kenya. "As people are laid off, the big challenge is to get the money back."

Troubles at European banks with operations in Africa could provide another transmission mechanism for contagion. Many European banks have already cut credit lines to African institutions.

Errol Kruger, South Africa´s banking regulator, says the collapse of venerable Wall Street banks was like "a murder in the house next door" and warns that African subsidiaries of western lenders may suffer. Absa, South Africa´s biggest retail bank, is facing credit rating downgrades because of the travails of Barclays, its British parent.

Absa and the other three big South African banks are incurring heavy losses as a retail credit boom sours and fears of a big domestic corporate failure persist. Yet their balance sheets remain relatively strong, shielded from the pitfalls in international capital markets in part by apartheid-era exchange controls. Already, Nedbank, whose main shareholder is Old Mutual, has entered a partnership with west Africa´s Ecobank.

Tougher times could spur further waves of consolidation. The global banking system has been shaken to its foundations in the past six months. The market leaders in Africa may find they emerge stronger.