23.06.22 Review

Vicious Circle of Crisis: the war in Ukraine might cause the greatest drop in living standards in the XXI Century for hundreds of million of people, the UN expert group warns

Before the war, Russia and Ukraine were among the leading food exporters to the global market — supplies that Asian and African countries are particularly dependent on. Supply disruptions and rising prices, along with other reasons, could lead to a dramatic drop in living standards for hundreds of millions of people, the UN Global Crisis Response Group wrote in its report.

Rising food and energy prices are eroding the purchasing power of the poorest households globally. There are growing signs of a "vicious circle": rising energy prices are pushing up food production costs, threatening even higher prices in 2023. Simultaneously due to rising global interest rates, developing countries are already facing a financial crisis that limits their ability to provide social support to their citizens. All this could lead to a wave of political crises around the world, according to the UN.