UNITED NATIONS (AP) – Russia’s war on Ukraine threatens to devastate the economies of many developing countries which now face even higher food and energy costs and increasingly difficult financial conditions, a warned a UN working group on Wednesday.
UN Secretary-General Antonio Guterres released the report saying war is “fueling” a food, fuel and financial crisis in the poorest countries already struggling to cope with the COVID-19 pandemic, in climate change and lack of access to adequate food. financing economic recovery.
“We are now facing a perfect storm that threatens to devastate the economies of many developing countries,” António Guterres told a press conference. “As many as 1.7 billion people ― a third of whom already live in poverty ― are now highly exposed to disruptions in food, energy and financial systems that lead to increased poverty and hunger.
Rebeca Grynspan, secretary-general of the UN agency for the promotion of trade and development who coordinated the task force, said these people live in 107 countries that are “severely exposed” to at least one dimension of the crisis – rising food prices, rising energy prices and tightening financial conditions.
In these countries, the report says, people struggle to afford healthy food, imports are essential to meet food and energy needs, and “debt burdens and resource constraints limit the ability of government weather the vagaries of global financial conditions”.
The report says 69 of the countries, with a population of 1.2 billion, are facing a “perfect storm” and are severely or significantly exposed to the three crises. They include 25 countries from Africa, 25 from Asia and the Pacific and 19 from Latin America and the Caribbean.
Before Russia’s invasion of Ukraine on Feb. 24, prices were already on the rise, “but the war made a bad situation worse,” said António Guterres.
Thirty-six countries depend on Russia and Ukraine for more than half of their wheat imports, including some of the world’s poorest countries, he said, and wheat and maize prices have increased by 30% since the beginning of the year.
Russia is also the world’s largest exporter of natural gas and the second largest exporter of oil, and Russia and neighboring Belarus export around 20% of the world’s fertilizers. Guterres said oil prices have risen more than 60% in the past year, natural gas prices have jumped 50% in recent months, and fertilizer prices have doubled.
The task force said the world was “on the brink of a global debt crisis”. Grynspan, who heads the United Nations Conference on Trade and Development, highlighted Sri Lanka’s debt default on Tuesday and said other countries were asking for help.
António Guterres said the world could act to deal with the “three-dimensional crisis” and “soften the blow”.
The task force calls on countries to ensure a steady flow of food and fertilizer through open markets, lift export restrictions and direct surpluses and reserves to those in need. Guterres said this would help contain food prices and calm volatility in food markets.
On energy, the task force urges governments to refrain from hoarding, immediately release strategic oil stocks and additional reserves, and reduce the use of wheat for biofuels. António Guterres urged countries to use the crisis as an opportunity to accelerate the transition to renewable energy.
On finance, the task force issued “an urgent call for prompt and prompt action by the international community” to help developing countries avoid another decade of lost economic development, “a crisis widespread debt and social and political instability”.
The task force says international financial institutions should provide emergency concessional financing to countries in social and economic difficulty.
It calls on the International Monetary Fund to increase limits on rapid financial assistance, suspend interest rate surcharges for two years and explore the possibility of providing more liquidity “through special drawing rights or special measures targeted at vulnerable and most affected countries”.
António Guterres said the upcoming spring meetings of the IMF and World Bank from April 18-24 are “a crucial time” for decisions on many of these issues. He said it was crucial that their members understand the need to use the money available to alleviate the suffering of people around the world.
The UN chief said political will was essential and announced he had asked six leaders ― the presidents of Senegal and Indonesia and the prime ministers of Germany, Barbados, Denmark and Bangladesh ― to mobilize political leaders to ensure that developing countries in crisis get the help they need.