PanaTimes

Thursday, Feb 09, 2023

World Bank warns of 'human catastrophe' food crisis

World Bank warns of 'human catastrophe' food crisis

The world faces a "human catastrophe" from a food crisis arising from Russia's invasion of Ukraine, World Bank president David Malpass has said.

He told the BBC that record rises in food prices would push hundreds of millions people into poverty and lower nutrition, if the crisis continues.

The World Bank calculates there could be a "huge" 37% jump in food prices.

This would hit the poor hardest, who will "eat less and have less money for anything else such as schooling".

In an interview with BBC economics editor Faisal Islam, Mr Malpass, who leads the institution charged with global alleviation of poverty, said the impact on the poor made it "an unfair kind of crisis... that was true also of Covid".

"It's a human catastrophe, meaning nutrition goes down. But then it also becomes a political challenge for governments who can't do anything about it, they didn't cause it and they see the prices going up," he said on the sidelines of the IMF-World Bank meetings in Washington.

The price rises are broad and deep, he said: "It's affecting food of all different kinds oils, grains, and then it gets into other crops, corn crops, because they go up when wheat goes up".

There was enough food in the world to feed everybody, he said, and global stockpiles are large by historical standards, but there will have to be a sharing or sales process to get the food to where it is needed.

Mr Malpass also discouraged countries from subsidising production or capping prices.

Instead, he said, the focus needed to be on increasing supplies across the world of fertilisers and food, alongside targeted assistance for the very poorest people.

The World Bank chief also warned of a knock on "crisis within a crisis" arising from the inability of developing countries to service their large pandemic debts, amid rising food and energy prices.

"This is a very real prospect. It's happening for some countries, we don't know how far it'll go. As many as 60% of the poorest countries right now are either in debt distress or at high risk of being in debt distress," he said.

"We have to be worried about a debt crisis, the best thing to do is to start early to act early on finding ways to reduce the debt burden for countries that are on have unsustainable debt, the longer you put it off, the worse it is," he added.


The acknowledgement by the World Bank president that we have to be worried about a developing country debt crisis, is very significant.

The combination of massive pandemic debts with rising interest rates, and rising prices is truly toxic.

The talk on the sidelines here at the IMF and World Bank meetings is that the rich countries told emerging economies not to worry about borrowing in order to spend to help suppress the pandemic.

Now those countries are wondering if these record debts will be written off.

Campaigning groups are preparing mobilisations over a pandemic debt jubilee. But there is silence from the rich country lenders, so far.

And there is a very new dynamic these days. The bankers to whom these sums are owed are no longer just in the West.

China is now, very broadly, owed as much as the entire collection of Western creditors known as the Paris Club.

How will it respond to calls for leniency on the repayment of loans?

Mr Malpass says of China: "They have different rules, for example, contracts that have non-disclosure clauses, meaning you can't share the terms with other people that makes it very hard to restructure those debts".

China has also secured its lending against ports and natural resources. Sri Lanka is a case in point right now.

The unwinding of all of this might not be orderly, and could have significant geopolitical consequences.

Earlier this month, the United Nations said that the Ukraine war had led to a "giant leap" in food prices, as they hit a new record high in March.

It came as the war cut off supplies from the world's biggest exporter of sunflower oil and the cost of alternatives climbed.

Ukraine is also a major producer of cereals such as maize and wheat which have risen sharply in price too.

The UN said "war in the Black Sea region spread shocks through markets for staple grains and vegetable oils".

The UN Food Prices Index tracks the world's most-traded food commodities - measuring the average prices of cereal, vegetable oil, dairy, meat, and sugar.

Food prices are at their highest since records began 60 years ago, according to the index, after they jumped nearly 13% in March, following February's record high.

Food commodity prices were already at 10-year highs before the war in Ukraine, according to the index, because of global harvest issues.

Newsletter

Related Articles

PanaTimes
Close
0:00
0:00
Today's news from Britain - 9th February 2023
China has declined the US's request for Defense Secretary Lloyd Austin to speak with Chinese Defense Minister Wei Fenghe after the US Air Force shot down a suspected Chinese spy balloon, according to the Pentagon
The five largest oil companies in the West generated combined profits of nearly $200 billion in 2022, which has led to increased calls for governments to impose tougher windfall taxes
2 earthquakes in Turkey killed over 2,300 people
U.S. added 517,000 jobs in January, snapping five-month string of slowing employment growth
Powerful Earthquake Strikes Turkey and Syria, Killing More Than 1,300 People.
Turkish photographer Ugur Gallenkus portrays two different worlds within a single image. Brilliant work
Tennessee Bill Would Imprison People for 3 Years If They 'Lie' About Rape to Get an Abortion.
Charlie Munger, calls for a ban on cryptocurrencies in the US, following China's lead
EU found a way to use frozen Russian funds
First generation unopened iPhone set to fetch more than $50,000 at auction.
WARNING GRAPHIC CONTENT - US Memphis Police murdering innocent Tyre Nichols
House Speaker Kevin McCarthy said he will block Reps. Adam Schiff and Eric Swalwell from serving on the House Intelligence Committee
Almost 30% of professionals say they've tried ChatGPT at work
Interpol seeks woman who ran elaborate exam cheating scam in Singapore
What is ChatGPT?
Bill Gates is ‘very optimistic’ about the future: ‘Better to be born 20 years from now...than any time in the past’
Tesla reported record profits and record revenues for 2022
Germany confirms it will provide Ukraine with Leopard 2 tanks
Prince Andrew and Virginia Giuffre Photo Is Fake: Ghislaine Maxwell
Opinion | Israel’s Supreme Court Claims a Veto on Democracy
Moonwalker Buzz Aldrin Gets Married On His 93rd Birthday
Who’s Threatening Israeli Democracy?
Federal Reserve Probes Goldman’s Consumer Business
China's first population drop in six decades
Microsoft is finalising plans to become the latest technology giant to reduce its workforce during a global economic slowdown
Tesla slashes prices globally by as much as 20 percent
1.4 Million Copies Of Prince Harry's Memoir 'Spare' Sold On 1st Day In UK
After Failing To Pay Office Rent, Twitter May Sell User Names
Lisa Marie Presley, singer and daughter of Elvis, dies aged 54
FIFA president questioned by prosecutors
Britain's Sunak breaks silence and admits using private healthcare
Hype and backlash as Harry's memoir goes on sale. Unnamed royal source says prince 'kidnapped by cult of psychotherapy and Meghan'
Saudi Arabia set to overtake India as fastest-growing major economy this year 
Google and Facebook’s dominance in digital ads challenged by rapid ascent of Amazon and TikTok
FTX fraud investigators are digging deeper into Sam Bankman-Fried's inner circle – and reportedly have ex-engineer Nishad Singh in their sights
TikTok CEO Plans to Meet European Union Regulators
France has banned the online sale of paracetamol until February, citing ongoing supply issues
Japan reportedly to give families 1 million yen per child to move out of Tokyo
Will Canada ever become a real democracy?
Hong Kong property brokerages slash payrolls in choppy market
U.S. Moves to Seize Robinhood Shares, Silvergate Accounts Tied to FTX
Effect of EU sanctions on Moscow is ‘less than zero’ – Belgian MEP
Coinbase to Pay $100 Million in Settlement With New York Regulator
FTX assets worth $3.5bn held by Bahamas securities regulator
A Republican congressman-elect is under investigation in New York after he admitted he lied about his education and work experience.
Brazilian football legend Pele, arguably the greatest player ever, has died at the age of 82.
Hong Kong to scrap almost all its Covid rules
EU calls screening of travellers from China unjustified
US imposes Covid testing for visitors from China
×