WASHINGTON — World Bank chief Robert Zoellick Tuesday said global food prices have reached dangerous levels that could complicate fragile political and social conditions in the Middle East, and warned that their impact also bears watching across Central Asia.
World Bank data released Tuesday showed higher food prices has pushed 44 million more people into extreme poverty since June 2010 in developing countries.
Zoellick said although higher food prices were not the main reason that led to violent protests in Egypt and Tunisia, it was an aggravating factor and could become worse.
He warned that a sharp rise in food prices across Central Asia could also have social and political implications for that region.
“There is no room for complacency,” Zoellick said. “Global food prices are now at dangerous levels and it is also clear that recent food price rises for food are causing pain and suffering for poor people around the globe.”
The World Bank report comes days before a meeting of the Group of 20 major economies in Paris, where higher food prices — and the reason for it — will be discussed.
Zoellick said he was concerned that as countries such as Egypt, Tunisia and Jordan address causes of their social upheaval, higher food prices may add to “the fragility that is always there any time you have revolutions and transitions.”
The World Bank chief said the international community needed to be aware of such risks and should not exacerbate problems by imposing policies, such as export bans, that would push global food prices even higher.
Catastrophic storms and droughts have hurt the world’s leading agriculture-producing countries, including flooding and a massive cyclone in Australia, major winter storms in the United States, and fires last year in Russia.
Zoellick said a World Bank team was currently in Tunisia taking a closer look at the country’s transition and assessing whether it needs World Bank financial assistance.
He suggested that Egypt may not need additional World Bank financing because its financing situation “is one that should be able to be managed.”
The Washington-based poverty-fighting institution said its food price index increased by 15% between October 2010 and January 2011 and is just 3% below its 2008 peak during the last food price crisis.
But unlike during the 2007-2008 food crisis, higher prices have not yet affected all regions of the world.
Read more: http://www.financialpost.com/Food+prices+dangerous+levels+World+Bank/4288058/story.html#ixzz1E8c2L5Pz
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