Yellen Highlights Ukraine War’s Impact on Food Insecurity During Summit With IMF, World Bank

Treasury Secretary Janet Yellen testifies before the House Committee on Financial Services in Washington on April 6, 2022. (Win McNamee/Getty Images)

Russia’s attack on Ukraine is creating a global food crisis, U.S. Treasury Secretary Janet Yellen said during a meeting on food insecurity with representatives from the International Monetary Fund (IMF), the International Fund for Agricultural Development (IFAD), and the World Bank.

Even before the Russia–Ukraine war, more than 800 million people, representing 10 percent of the global population, were suffering from chronic food insecurity, Yellen said at the April 19 meeting, according to a press release.

“The war has made an already dire situation worse. Price and supply shocks are already materializing, adding to global inflationary pressures, creating risks to external balances, and undermining the recovery from the pandemic,” Yellen said.

“I want to be clear: Russia’s actions are responsible for this. But the United States is urgently working with our partners and allies to help mitigate the effects of Russia’s reckless war on the world’s most vulnerable,” she said.

Even as Washington escalates sanctions against Russia, she said, it is also acting to ensure that the world has enough agricultural commodities along with basic foodstuffs.

The meeting was planned with three objectives in mind, Yellen said. First, to understand the factors driving global food insecurity. The destruction of Ukraine’s economy and infrastructure by Russia is a “key factor” affecting commodity prices worldwide. These actions could result in 10 million people from sub-Saharan Africa being pushed into poverty due to rising food prices.

The second involves applying “valuable lessons” learned from previous food crises to the current scenario. Yellen highlighted how the leading industrial nations of the G-20 launched the Global Agriculture and Food Security Program in response to the food crisis in 2008. That program sought to boost investment in the poorest nations as well as develop an agricultural market information system.

The third step is about how international financial institutions (IFIs) can take concrete actions for an “effective response.” IFIs can make use of analytical tools to evaluate macroeconomic impacts of the Russia–Ukraine war as well as assess the specific needs of affected nations. Moreover, they can help in smoothing out the supply chain crisis, mitigate fertilizer shortage, boost domestic food production, and so on, Yellen stated.

IMF Managing Director Kristalina Georgieva announced that her organization will respond to financing requests from nations affected by rising food prices, an April 19 press release stated.

“We will coordinate with IFIs and donors and look to them to step up humanitarian assistance and grants for the hardest-hit low‑income countries. And we will deploy the new Resilience and Sustainability Trust to help countries adapt agriculture to a world of more frequent and severe climate shocks,” Georgieva said.

Food prices are currently at high levels, with the U.N.’s Food and Agriculture Organization Food Price Index making the biggest jump since 1990. The price of items like cereals, meat, and vegetable oils have hit all-time highs according to the organization.