Global food shortages disproportionately affect poorer countries and developed nations should do their bit to address the crisis, according to World Bank Group President David Malpass.
The ongoing Ukraine-Russia conflict is having a “severe” impact on food supplies, Malpass said in a statement delivered at the organisation’s annual Spring Meetings event.
Both Ukraine and Russia are substantial food producers, and the latter is also the world’s largest exporter of fertiliser chemicals.
The effect of the invasion and disruption to crop cycles is therefore being felt across the world, particularly for food products and ingredients like sunflower oil, dairy and bread.
“Above all, the war and its consequences are putting stress on poor people around the world,” Malpass said. “It’s adding to the debt burden, an overburden in many countries, and also the fragility of the world environment.”
As part of its reaction to the conflict, Malpass said the World Bank was expecting to pay out $170 billion in disbursements over the next 15 months – the largest set of commitments ever promised by the organisation.
Beyond geopolitical conflict, the global food crisis is being inflamed by rising inflation. Food prices are up 37% year-on-year, Malpass explained.
Such circumstances caused the World Bank to cut its forecast for global growth to 3.2% earlier this week, down from 4.1%. The International Monetary Fund has also lowered its projections.
This is worse felt by disadvantaged people, who must spend more of their budget on food in comparison to those who are better off. According to World Bank estimates, every 1% increase in food prices risks nearly 10 million additional people living in extreme poverty.
Offering solutions which could help poorer countries obtain the food and fertiliser they need, Malpass encouraged developed countries to open their markets further.
Giving the example of India, which has recently begun selling internationally from its stockpiles, he said this could “add a lot to the global supplies and alleviate some of the impact on the poor countries”.
Malpass signed off by highlighting the role of central banks in dealing with the issue. “The central banks can use tools that add to supply and that allow capital allocation to be improved. I think that’s going to be vital,” he said.
“They have regulatory policy tools that can be used to allow and encourage more investment in small businesses and in new businesses, that will be the dynamic portion of a new economy.”