World Bank President David Malpass has said “I’m deeply concerned about developing countries. They’re facing sudden price increases for energy, fertiliser, and food, and the likelihood of interest rate increases. Each one hits them hard”. He said this in a curtain raiser speech delivered at the opening of the International Monetary Fund and World Bank Group Spring Meetings in Washington.
According to him “these, plus the war in Ukraine and China’s COVID-related shutdowns, are pushing global growth rates even lower and poverty rates higher. We’ve lowered our 2022 growth rate to 3.2 per cent from 4.1 per cent before. People are facing reversals in development for education, health, and gender equality. They’re facing reduced commercial activity and trade. Also, the debt crises and currency depreciations have a burden that falls heavily on the poor. Many discussions this week will focus on these topics.
“For Ukraine, we’ve mobilized nearly $1 billion in emergency financing, and we’ve announced another $1.5 billion to support essential government services. I made that announcement in Poland last week. I want to spend a few minutes on the issue of food insecurity. I was recently at the World Water Forum in Senegal, and then I visited Morocco. Both countries are being affected by the price spike in the energy and fertiliser that are used to make food. This is an intense problem.
Food crises are bad for everyone, but they’re devastating for the poorest and most vulnerable. There are two reasons. First, the world’s poorest countries tend to be food importing countries. Second, food accounts for at least half of total expenditures in household budgets in low-income countries, so it hits them hardest.