High Food Price Inflation and Food Insecurity: A Global Crisis and the World Bank’s Response

The World Bank has released a food security update, highlighting the ongoing issue of domestic food price inflation around the world. According to data from September to December 2022, high inflation levels above 5% were found in 94.1% of low-income countries, 92.9% of lower-middle-income countries, and 89% of upper-middle-income countries. Even high-income countries have seen an increase in food price inflation, with 87.3% experiencing high levels. The countries most affected are located in Africa, North America, Latin America, South Asia, Europe, and Central Asia.

The International Monetary Fund (IMF) also recently released a report indicating that global food prices are expected to remain high due to war, energy costs, and weather events. This has led to increased food insecurity, social tension, and strain on the budgets of countries that rely on food imports. A report from the Global Network Against Food Crises highlights that countries experiencing food crises receive the most humanitarian financing, and when all sectors are considered, development allocations to food crisis countries are much larger than humanitarian assistance.

One of the main obstacles to food production in low-income countries is the high cost of fertilizers. According to a recent World Bank blog, 205 million people are currently in acute food insecurity in 45 countries worldwide, and many of these countries lack the raw materials and production facilities to ensure that farmers can affordably access fertilizers. This is particularly evident in Sub-Saharan Africa, where disruptions to fertilizer exports and restrictions on other exporting countries have hit poor households the hardest.

A new analysis conducted by the International Food Policy Research Institute (IFPRI) of 1.27 million children in 44 low- and middle-income countries explores the potential impacts of food inflation on wasting and stunting among pre-school children. The study found that the impacts of food inflation occur early in life and disproportionately affect the rural poor and landless. This highlights the urgent need to improve women’s nutrition and health before and during pregnancy to guarantee prenatal health and nutrition support for mothers and children.

The World Bank has taken action to address the food security crisis by making up to $30 billion available over a period of 15 months, including $12 billion in new projects. From April through September, the Bank has committed $8.1 billion for new projects across 47 countries, with most of this support going to Africa, one of the regions hardest hit by the food crisis. These projects will include efforts to encourage food and fertilizer production, enhance food systems, facilitate greater trade, and support vulnerable households and producers. Examples include a $125 million project in Jordan to strengthen the agriculture sector, a $300 million project in Bolivia to increase food security, and a $2.3 billion Food Systems Resilience Program for Eastern and Southern Africa.

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