U.S., banks unveil plan to ease food crisis from Russia's war
U.S., banks unveil plan to ease food crisis from Russia's war
The U.S., several global development banks and other groups on Wednesday unveiled a multi-billion dollar plan to stave off a worldwide food security crisis worsened by Russia's war in Ukraine, a key danger facing an increasingly fragile world economy.
The February invasion has touched off a sharp increase in energy and food prices that are now contributing to a slowdown in growth, prompting Treasury Secretary Janet Yellen to note the risk of stagflation at a news conference.
“The economic outlook globally is challenging and uncertain,” Yellen said. “And higher food and energy prices are having stagflationary effects, namely depressing output and spending and raising inflation all around the world.”
- Complete coverage of the war in Ukraine
- Who are Mariupol's last defenders?
- WATCH: Banning sanctioned Russians from entering Canada
Yellen added that the U.S. is “best positioned” to meet this economic challenge because of its strong jobs market, yet she noted that food shortages are a threat around the world that needs to be addressed.
The Treasury Department announced that several global development banks are “working swiftly to bring to bear their financing, policy engagement, technical assistance” to prevent starvation prompted by the war, rising food costs and climate damage to crops.
Tens of billions will be spent on supporting farmers, addressing the fertilizer supply crisis, and developing land for food production, among other issues. The Asian Development Bank will contribute funds to feeding Afghanistan and Sri Lanka and the African Development Bank will use $1.5 billion to assist 20 million African farmers, according to Treasury.
The European Bank for Reconstruction and Development, the Inter-American Development Bank, the International Fund for Agricultural Development and the World Bank will also contribute tens of billions in the coming months and years to support food producers and address supply shortage issues.
The plan stems from a meeting that Yellen convened in April at the International Monetary Fund and World Bank spring meetings, where she called on powerful nations to look for specific ways to combat a looming crisis over food insecurity around the globe that Russia's war in Ukraine has made even worse.
Russia and Ukraine produce a third of the world's wheat supply, and the loss of commodities due to the war has resulted in soaring food prices and uncertainty about the future of food security globally, especially in impoverished countries.
As part of the effort to address the crisis, Secretary of State Antony Blinken will convene meetings in New York on the sidelines of the UN over the next two days focusing on food insecurity. The State Department says that in 2021, more than 193 million people worldwide experienced acute food insecurity, an increase of 40 million people from the year before. As many as 40 million are projected to be pushed into poverty and food insecurity by the end of the year.
Shortages of fuel and fertilizer in many countries and accelerating spikes in food prices threaten to destabilize fragile societies, increase hunger and malnutrition, drive migration, and cause severe economic dislocation. Conflict has greatly exacerbated food security issues globally.
Yellen arrived in Germany for a meeting of finance ministers for the Group of Seven leading economies in Bonn, Germany later this week. She met Tuesday with EU Commission President Ursula von der Leyen in Brussels. Yellen said they discussed “critical issues related to energy security, Ukraine's economic needs, and continued coordination to impose sanctions on Russia.”
While European nations plan to phase out of Russian oil and gas, the U.S. is pressing EU leaders to consider possible oil tariffs and other methods of preventing Russia from benefiting from increased energy prices.
Yellen's visit to Europe, which included time in Poland, is meant to address the effects of the war in Ukraine, an international tax plan she negotiated with more than 130 countries last year and an energy crisis contributing to high inflation worldwide.
Along with being tasked to impose financial sanctions on Russia, distribute pandemic programs still in effect and other duties, now Yellen will be responsible for ensuring the world's most vulnerable populations don't starve as the war in Ukraine rages on and threatens wheat and grain supplies world wide.
Get in touch
Do you have any questions about the attack on Ukraine? Email email@example.com.
- Please include your name, location, and contact information if you are willing to speak to a journalist with CTV News.
- Your comments may be used in a CTVNews.ca story.
MORE Business News
Prices have been easing slightly recently, but affording a mortgage is still a very difficult task for many Canadians. How much of a mortgage can you afford? Contributor Christopher Liew breaks it down in an exclusive column for CTVNews.ca.
The Bank of Canada's strategy of rapidly increasing its key interest rate in an effort to tackle skyrocketing inflation will likely trigger a recession, says a new study released Tuesday from the Canadian Centre for Policy Alternatives.
Even though it may seem years away, saving for retirement is a top priority among 26 per cent of Canadians aged 18 to 34, a recent survey from the Healthcare of Ontario Pension Plan found. However, 79 per cent of respondents in that age group say saving for retirement is prohibitively expensive.
A new report says Canada should replace its "haphazard and unpredictable" approach to minimum wages across the country with a clear formula based on average incomes.
A new report from TD says Canadian home sales could fall by nearly one-quarter on average this year and remain low into 2023.
The Canada Day long weekend saw gas prices plummet in parts of the country, but the relief at the pumps may not stay for very long, analysts say. The decreases come after crude oil prices slid in June following the U.S. Federal Reserve's interest rate hikes, sparking fears of a recession.
As stocks continue to slump, it can be easy to let your emotions take over if you've got money invested in the market. But experts agree that there's no need to panic if you're invested in the right type of portfolio with the right level of risk.
With increasing rent prices likely to be the reality for many Canadian tenants, some may be wondering how to navigate rising costs, or whether any course of action can be taken, if any. Legal experts across the country share their advice on how to handle a rent hike.