Russia’s Aggression Stoking a Global Food Crisis and Major ‘Wellbeing Inequality’ Issue
By Thierry Malleret, economist
Russia’s aggression is stoking a major global food crisis which hurts disproportionately the poorest nations and the poorest people. The conflict is constraining production and supplies in the Black Sea breadbasket region (which accounts for about a quarter of all grain trades) and is wreaking havoc on food and fertilizer supply chains. As a result, world food prices just surged at their fastest pace ever (at the end of March, they were up 34% up year-over-year and 12.6% month-over-month). Food price inflation will last for as long as the war lasts. A UN agency estimates that the global gap between supply and demand for food and feed provoked by the war could raise world food prices by a further 8 to 22%. Skyrocketing food prices risk creating social and political turmoil, large pockets of instability, and multiple second-round consequences (like massive uncontrolled migration).
And it will drive further “wellness inequality.” As food costs account for an average of 17% of total consumer spending in advanced economies and much more in emerging markets and developing countries (up to 40% in Sub-Saharan Africa), surging food prices affect the poorest nations and the poorest people the very most.
In the rich world–where famine is not an issue–food price inflation (that tends to exacerbate unhealthy eating habits) will compound problems of obesity. A recent report from the World Health Organization shows that obesity rates have increased during the pandemic. They’ll most likely continue to do so, feeding the unwellness epidemic. Obesity is now responsible for 13% of mortality in Europe (a region that did better than others until recently), where no country is on track to reduce obesity rates by 2025.