Rising food and energy prices push millions into poverty: UN

A United Nations report released Thursday said tens of millions of people have fallen into poverty as a result of the global rise in food and energy prices.

The United Nations Development Program estimates that an additional 51.6 million people are now living in poverty or on less than $1.90 a day as a result of global inflation – an increase from 8.3 percent to 9 percent of the world’s population.

The additional number of people falling below $3.20 a day came to nearly 20 million, bringing the cumulative net figure to 71.5 million, the report said.

“This cost-of-living crisis is pushing millions of people into poverty and even starvation at an astonishing speed, however, the risk of growing social unrest is increasing day by day,” Achim Steiner, Administrator of the United Nations Development Program (UNDP), said in a statement.

The report is based on an analysis of estimated household income in 159 countries and price hikes from late October last year through late April.

The report stated that between half and two-thirds of the increase in corn and energy prices occurred in the months following the start of the Russian invasion of Ukraine. For wheat and the main types of fertilizers, the number is between 30 and 40 percent.


A man processes wheat in Odessa, Ukraine, June 17, 2022 (Anadolu Agency/Getty/Kyodo)

Russia and Ukraine together account for nearly a quarter of global wheat exports. Before the outbreak of the war, Russia was the world’s largest exporter of natural gas and the second largest exporter of crude oil.

Referring to the war in Ukraine that began in late February, Steiner told a news conference that “the impact on poverty rates is significantly faster than the actual shock of the COVID-19 pandemic.”

The report warned of trade-offs from some of the policies that developing countries usually enact to combat the effects of inflation, such as blanket subsidies or tax cuts.

“They provide some relief as an immediate aid, but they risk causing worse injuries over time,” said George Gray Molina, head of strategic engagement policy at the United Nations Development Programme, adding that food and fossil fuel subsidies tend to benefit the wealthy disproportionately and could lead to The further exacerbation of global climate change.

In the short term, cash transfers such as temporary basic income “more than alleviate” global inflation caused by inflation, Molina said, increase below the international poverty line.

The report comes amid diminishing expectations for global economic growth. The International Monetary Fund said in April that it expected 3.6% growth for the global economy in 2022, down from a previous forecast of 4.4%.

Molina said that for 15 years, until the coronavirus crisis, it was economic growth in emerging and developing economies that sustained global economic growth.

“With COVID, we’ve seen a divergence between the richest economies and the world’s poorest. What we’re seeing now is a worrying trend where developing and emerging economies cannot return to the economic growth trajectory they were on in the past,” he said.


Related Coverage:

G20 foreign ministers meet amid continuing tensions over Ukraine

90% of Japanese feel price increases, highest since 2008: survey


Leave a Reply

%d bloggers like this: