The International Panel of Experts on Sustainable Food Systems (IPES-Food) has released a report specifically sounding the alarm about the global issue of food insecurity and the debt crisis. The report shows the following: three million of us are suffering from acute hunger and a lot more are likely to suffer hunger as food prices remain at historical highs, and nations are unable to repay debts.
in ” Breaking the Cycle of Unsustainable Food Systems, Hunger, and Debt,” IPES-Food notes that the COVID-19 virus and Russian incursion into Ukraine caused a rise in prices for food over the last two years.
“Although there has been some easing of food prices in recent months, it is unpredictable what the fallout from the interplay with the debt crisis will be,” Jennifer Clapp, Canada Research Chair in Global Food Security and Sustainability at the University of Waterloo, Ontario and co-author of the report says to Food Tank. “But we are seeing food price inflation remaining higher than overall inflation, and this is deeply troubling.”
The authors have now stated that middle- and low-income nations (LMICs) are under threat from the growing debt crisis. IPES-Food estimates that 60 percent of low-income nations as well as 30 percent of mid-income nations are at the risk of defaulting on their debt. As per the research Zambia, Sri Lanka, and Suriname have already been in default. While, other countries such as Ghana and Pakistan could be at risk of defaulting as well.
The report outlines four crucial ways that food systems that are not sustainable contribute to the debt crisis of hundreds of LMICs. They are dependent on imports for fertilizers and food which force them to rely on cash crops in order to pay off debts and blocks them from diversifying their agricultural production. Furthermore, decades of detachment from social services as well as domestic agriculture has further increased the issues. As prices for food rise and fall farmers are left not able to compete with big corporations. In addition, the climate crisis that is getting worse creates uncertainty, ruining crops and increasing debt of farmers.
The rising costs of imports for fertilizer and energy are straining the producers. Countries that rely upon foreign assistance will be enduring the effects of inflation, which extend beyond food items According to IPES-Food.
The authors of the report provide three suggestions for solutions to policy to tackle the dual crisis of food insecurity and debt. International institutions must respond to the present challenges by increasing both development and debt relief investments in struggling countries They argue. They also say that they must adopt policies that deal with decades or even centuries of divestment of wealth of Global South states. Policies include taxing agricultural businesses for price hikes as well as debt reparations that are based on the destruction of the environment.
The report also recommends rethinking the structure of current institutions and also forming new financially independent institutions. A radical reform could increase the negotiating power of less developed nations in negotiating debt agreements.
Another option is to introduce of security measures, such as the need for review of lending practices among Global North as well as South nations in existing institutions such as that of the International Monetary Fund or World Bank.
“Any new initiative for climate financing or debt restructuring must not repeat the mistakes of the past, damaging conditionalities and colonial power relations,” Lim Li-Ching, IPES Food co-chair, and senior researcher for Third World Network, tells Food Tank.
“And rather than using public money to guarantee private investments, we should rather find ways of repairing historical injustices and return resources to the Global South, while deterring climate destruction in the first place.”
The report proposes that decision-making be made more democratic within global food systems as well as financial institutions like those of the International Monetary Fund and the World Bank. The diversity of who sits in the room is an essential aspect in resolving this complicated issue, says the report.
“In fulfilling their domestic mandates, big central banks are inadvertently triggering debt distress for countries across the world when they raise interest rates because their actions are raising the costs of servicing debt worldwide,” Clapp says on Food Tank.
IPES-Food says that financial institutions could help ease the stress of crises in international relations and not perpetuate these dependent relationships between rich and less developed countries.