Treasury Secretary Janet Yellen addressed the rising global food insecurity exacerbated by the Russia-Ukraine war, and asked world leaders to take concrete actions.
Speaking at the “Tackling Food Insecurity – The Challenge and Call to Action” meeting on April 19, Yellen said, “This threat touches the most vulnerable people the hardest – families that are already spending disproportionate amounts of their income on food. Moreover, the interconnectedness of the global food system means that people on every continent are impacted.”
She explained that the war has made “an already dire situation worse,” as price and supply shocks are already materializing, adding to global inflationary pressures, creating risks to external balances, and undermining the recovery from the pandemic.
“I want to be clear: Russia’s actions are responsible for this. But the United States is urgently working with our partners and allies to help mitigate the effects of Russia’s reckless war on the world’s most vulnerable,” she said at the meeting, which included the heads of the IMF, World Bank, and International Fund for Agricultural Development (IFAD), and the Finance Ministers of Indonesia and Germany representing the G20 and the G7, as well as lead technical experts on food security and agriculture at the International Financial Institutions (IFIs).
Early estimates suggest that at least 10 million more people could be pushed into poverty in Sub-Saharan Africa due to higher food prices alone, she added.
Some of the proposed solutions include avoiding export restrictions that could further increase prices, supporting the most vulnerable populations with social safety nets and providing targeted support for smallholder farmers so they can continue to produce.
“And we must not lose sight of the need to strengthen longer-term resilience, because this latest shock will unfortunately not be the last,” she said.
In terms of “concrete actions” the international financial institutions can take to deliver an effective response, Yellen said that the IFIs are well-placed to work with affected countries and partners to develop solutions.
“They can use their analytical tools to assess the specific needs of affected countries while also evaluating the macroeconomic impacts of the war. They can help mitigate the global fertilizer shortage and smooth supply chain disruptions for food and critical supplies. They can increase investments in agricultural capacity and resilience to boost domestic food production. And they can provide targeted assistance and strengthen social safety nets to protect vulnerable people in the short term and build their resilience over the longer term,” she said.
Yellen added that technical experts from the international financial institutions, including the multilateral development banks, IFAD, and the IMF would convene later in the day to develop an action plan for an effective and coordinated response.
International food prices reached an all-time high in February, posting a 24.1% increase above its level a year ago, as GOBankingRates previously reported.
The FAO Food Price Index (FFPI) – the measure of the monthly change in international prices of a basket of food commodities – averaged 140.7 points in February 2022, up 5.3 points, or 3.9% from January, the U.N. agency said in a press release.
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