Global cost-of-living crisis catalyzed by war in Ukraine sending tens of millions into poverty, warns UN Development Programme

Photo: UNDP Serbia

“Unprecedented price surges mean that for many people across the world, the food that they could afford yesterday is no longer attainable today,” says UNDP Administrator, Achim Steiner. “This cost-of-living crisis is tipping millions of people into poverty and even starvation at breathtaking speed and with that, the threat of increased social unrest grows by the day.”

“We are witnessing an alarming growing divergence in the global economy as entire developing countries face the threat of being left behind as they struggle to contend with the continuing COVID-19 pandemic, crushing debt levels and now an accelerating food and energy crisis”, says Steiner. “Yet new international efforts can take the wind out of this vicious economic cycle, saving lives and livelihoods — that includes decisive debt relief measures; keeping international supply chains open; and coordinated action to ensure that some of the world’s most marginalized communities can access affordable food and energy.”

“While blanket energy subsidies may help in the short term, in the longer term they drive inequality, further exacerbate the climate crisis, and do not soften the immediate blow of the cost-of-living increase as much as targeted cash transfers do,” says report author George Gray Molina, UNDP Head of Strategic Policy Engagement. “They offer some relief as an immediate band-aid, but risk causing worse injury over time.”

“Cash in the hands of the people who are reeling from the astronomical price increases to food and fuel will have a widespread impact in positive ways,” Molina says. “Our modeling shows that even very modest cash transfers can have dramatic and stabilizing effects for the poorest and most vulnerable in this crisis. And we know from COVID-19 responses that developing countries must be supported by the global community to have the fiscal space to fund these schemes.”

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store