Muristek
UN trade body warns of Ukraine crisis’ adverse impact on developing countries
Associated Press Of Pakistan
UN trade body warns of Ukraine crisis’ adverse impact on developing countries
UNITED NATIONS, Mar 12 (APP):The United Nations’ trade body chief has warned about the detrimental effects stemming from the war in Ukraine on developing countries where soaring food and fuel prices would affect the most vulnerable. “All countries will be affected by this crisis, but developing countries already hit by the COVID-19 pandemic, rising debt and climate change will be hit especially hard by disruptions in food, fuel, and finance,” Rebeca Grynspan, secretary-general of the UN Trade and Development (UNCTAD), said in a statement underlining the conflict’s huge cost in human suffering and in sending shocks through the world economy. “This crisis, coming during the global COVID-19 pandemic, is accelerating existing vulnerabilities and widening inequalities across the world,” she said. “All countries will be affected by this crisis, but developing countries already hit by the COVID-19 pandemic, rising debt and climate change will be hit especially hard by disruptions in food, fuel, and finance,” the UNCTAD chief said. “Soaring food and fuel prices will affect the most vulnerable in developing countries, putting pressure on the poorest households which spend the highest share on their income on food, resulting in hardship and hunger. “This is cause for great concern, as social and political stability and increasing food prices are highly correlated,” she added. “Countries, already under severe pressure due to the costs of the pandemic, will see disruption in trade, deficits widen and investment contract. Additionally, significant increase in oil and gas prices can shift investment back into fossil-fuel-based energy generation, which risks reversing the trend towards renewables at a time of acute climate crisis. “All these shocks threaten the gains made towards recovery from the COVID-19 pandemic and block the path towards sustainable development.” UNCTAD, she added, was committed to supporting developing countries to face these shocks and protect the wellbeing of their populations, specially the most vulnerable. Meanwhile, the International Monetary Fund said it will likely cut its global growth forecast to account for the economic consequences of the Ukraine crisis. “We think that we would be downgrading our growth projections as a result of the crisis, but we still expect the world to be in positive growth territory,” IMF Managing Director Kristalina Georgieva told an American TV network. Her comments come a day after the IMF approved $1.4 billion in emergency aid to Ukraine. That money will be used to support major Ukrainian government activities, such as paying salaries and pensions, Georgieva said. In its January outlook, the IMF projected global growth of 4.4% in 2022, a moderation from the 5.9% experienced in 2021. It’s unclear by how much the Washington-based organization will now slash its growth outlook. “Obviously, how long this war goes is the main uncertainty factor we face,” Georgieva told MSNBC TV. Several spillover effects from the invasion, including rising commodity prices, could cause problems for the world economy and inhibit growth, she said. Commodity prices have soared in recent weeks amid investor fears the conflict will tighten global supply. Brent crude, the international oil benchmark, has soared since the invasion on Feb. 24, though oil prices have fallen in recent sessions. Metals including palladium and nickel have also surged in price. Ukraine and Russia also are two of the world’s largest agricultural exporters, sparking concerns about food prices, as well. Inflation is already at elevated levels, and Georgieva said increased price pressures stemming from the war could weigh further on real incomes and, in turn, tamp down consumer demand. Decreased business confidence also is a concern. She added that while Russia will “definitely” go into a recession, it’s not certain that neighboring countries in Europe and Asia will follow. The IMF’s concern is that tightening economic conditions as a result of the events of the past two weeks could hinder countries already slow to recover from the Covid-19 pandemic, she said. “That may mean some sparking of recessionary fears,” Georgieva said.
This post UN trade body warns of Ukraine crisis’ adverse impact on developing countries first appeared on Associated Press Of Pakistan and owns the property.