Billions of people are at risk of hunger due to increasing poverty and instability caused by conflict, covid, natural disasters and climate change.
The importance of Ukraine’s remarkably fertile soil to the world’s grain supply has drawn media attention, amid concerns that the conflict will lead to sharp price increases, and indeed the FAO Price Index speaks volumes. : the value published at the beginning of June, which reflects the monthly variation in international prices of a basket of the most traded food products during the month of May, was still 22.8% above the level of May 2021. We are at all-time highs.
The number of acutely food insecure people rose to nearly 193 million in 2021, 40 million more than in 2020, and is set to rise further this year, as also confirmed by the World Report on Food Crises, and countries like Afghanistan, Somalia, South Sudan and Yemen are already in danger of famine.
The biggest risk is that the agri-food crisis unleashed by the war in Ukraine will worsen in 2023 due to the reduction in exports from India and other countries.
In this context, moreover, food prices will remain high as long as the cost of energy is high because this translates into high prices for fertilizers and the fuel necessary for agricultural machinery and the agri-food industry, but we must consider that , while the production of hydrocarbons can increase immediately in different places to meet market demand thanks to measures such as those recently adopted by OPEC (the cartel of oil exporting countries), the production of cereals cannot increase in the same way way, and even a large expansion cannot compensate for the large volume of agricultural production that Russia now controls directly or indirectly.
So the question is not whether there will be serious economic effects and food shortages in already fragile states; the critical question is: how long will this crisis last? With countries like Yemen, Libya, Lebanon, Sri Lanka and Sudan, among others, heavily dependent on Ukrainian grain, even a short-term delay in supply can have drastic consequences.
The 2011 food crisis taught us that food inflation can destabilize markets, leave millions of people hungry and, in some cases, even lead to political instability.
For all these reasons, it is essential to get more financing, as soon as possible, to the weak states that depend on the importation of these foods to alleviate this crisis. And even more so in a context like the current one in which, despite its essential importance, only 8% of the total funding allocated to the humanitarian food security sector is allocated to agriculture.
From the FAO we appeal to governments and institutions so that new mechanisms are launched by the international community to reverse these trends. In particular, we propose the creation of a new Fund for the Financing of Food Imports (FFIA), in order to facilitate the financing of the substantial increases in the immediate costs of food imports that were normally carried out before the crisis in Ukraine. vulnerable countries that, given their high levels of indebtedness, do not have access to alternative sources of financing.
The first estimates indicate that new contributions would be necessary for a volume of financing of between 2,500 and 25,000 million US dollars to cover the most immediate needs in the face of a possible increase in the cost of imports of between 10% and 100% and guarantee this food security in those countries exposed to greater risks.
Food-importing countries in the low- and middle-income groups of the World Bank’s income classification would be eligible, extending eligibility also to net food-importing countries that are members of the IDA (International Development Association), the Bank’s entity World that provides aid to the poorest countries.
This fund would complement existing mechanisms in the United Nations system and would be activated only in case of urgent need. Furthermore, the FFIA would aim at future resilience, as beneficiary countries would have to commit to investing in sustainable agri-food systems.
In short, the international community must allocate new resources to sustain agricultural production in crisis contexts, as well as invest more in new technologies and in more transparent market information systems, in order to put a stop to the current crisis and prevent it from repeating itself. on the same terms in the future.
Agri-food supply chains and value chains need to be strengthened around the world, with the participation of the public and private sectors in support of small farmers and households.
