Putin has unleashed catastrophe on the world – and the West could get the blame
We are only at the start of understanding the series of catastrophes unleashed by Vladimir Putin’s war. Governments get justifiably jumpy when their energy supplies are threatened. But when food supplies are in doubt, governments fall.
Mercifully for us, the UK does not depend for food on any country or trade route directly affected by the war. Although price rises will hit British households, for most the grocery shop is a lighter burden than the utility bill. Outside the developed world, neither factor holds.
The war in Ukraine and resulting sanctions have taken a huge slice out of global food production. And as rising interest rates in the US suck capital out of developing markets and bombs and blockades stop grain flowing in, we will see riots, starvation and conflict arise in countries around the world. Many of Europe’s neighbours in the Middle East and North Africa will be among the worst affected.
The biggest immediate impact comes from the blockading of Ukraine’s Black Sea ports, which are usually powerhouses of the global food trade, shipping vast cargos of barley, maize, wheat and sunflower oil south to countries that often have few other supplies on the same scale. The US and European sanctions regimes have not directly targeted food, but Russia is holding the grain to ransom as a bargaining chip to try to get other sanctions loosened. If it doesn’t get any concessions, it will blame the West for the millions who starve.
This is hardly the extent of the trouble. Together, Russia and Ukraine account for 75 per cent of sunflower oil, 34 per cent of wheat and 25 per cent of barley exports. With Moscow set to default on its foreign debts next week if the US won’t extend Russia’s access to dollars, shipping grain out of the country is getting more expensive and more difficult. Indeed, the sanctions are proving so effective that Moscow’s ability even to supply neutral countries is already suffering.
The shortage of grain could worsen next year, as Ukrainian farmers are forced to spend time fleeing, fighting or digging out landmines rather than sowing crops. On top of the missed planting season, the costs of inputs for farmers everywhere are spiralling. Fuel prices are making it prohibitively expensive to run tractors and harvesters. And the EU’S decision to sanction Belarusian exports of potash, an essential fertiliser ingredient, may be an admirable indication of its resolve, but may also do more harm than good. Europe buys most of its potash from Belarus. Now, farmers will be forced to tap other markets, raising costs everywhere.
The choking-off of Russian and Ukrainian supplies is hitting a market already squeezed by the weather. Most of the US west of the Rockies is in drought, affecting its biggest wheatproducing areas and diminishing stocks even before the war hit. India was expected to pick up the shortfall. Instead, Delhi restricted wheat exports last week after an intense heatwave destroyed a large share of its harvest. India is not alone, either. According to the International Food Policy Research Institute, food protectionism is on the rise in 23 countries and counting across the world.
You might think all of this would be a great opportunity for large-scale wheat farmers elsewhere, like Australia. Instead, Canberra last month estimated that wheat production would fall by 20 per cent next year thanks to – guess what? – soaring fertiliser costs.
Life on the other side of this global trade in bare necessities is going to become unbearably tough. Oilexporting nations, like Nigeria, Angola and Algeria, should be able to weather the storm tolerably assuming their governments can divert excess oil profits into mitigating food shortages. But a host of others, like Morocco, Lebanon and Ghana, have little to fall back on. Egypt, a major buyer of Russian and Ukrainian grain and usually a destination for tourists from both countries, has already been forced to ask the International Monetary Fund for help. Cairo has just suffered its second currency devaluation in eight years, making imports even pricier.
Tunisia, the birthplace of the Arab Spring, is also in talks with the IMF as its economy deteriorates. The Fund’s demands, not least the need to cut Tunisia’s huge public sector wage bill, are likely to trigger widespread unrest. Meanwhile, inflation has hit 61 per cent in Turkey, another big importer of Russian wheat whose economy was already in the doldrums before the war. Worst of all, it’s hard to see how all of this can avoid compounding existing famines in Afghanistan, Yemen and East Africa.
The West is not responsible for the war, but our governments do have a duty to minimise the impact of sanctions on the millions of innocent bystanders now struggling to work out where their next meal is coming from, let alone next year’s meals. This does not mean allowing Russia to hold hungry populations in the Middle East hostage, or reducing direct pressure on Moscow in any way.
But it does mean putting extraordinary efforts into remedies, like shipping Ukrainian grain out to the world by rail, brokering new trade arrangements for the worst-affected countries, helping to fix agricultural mismanagement in producer nations and trying, where possible, to stem the tide of food protectionism. It may also mean rethinking some sanctions, like Europe’s potash ban, that will disproportionately raise food prices and which are not essential to the economic campaign against Russia. If Germany isn’t even willing to stop buying Russian gas, for God’s sake, Europe can hardly justify a policy that exacerbates starvation in much poorer countries.
Aside from the moral responsibility, there are good practical reasons why the US and Europe must do all they can to keep food growing and flowing. Global opinion on the Ukrainian war is far from settled and outside the West there is as much of a tendency to blame Nato as there is to recognise Mr Putin’s unprovoked aggression. Populations hit by rampant food shortages may be strongly inclined to blame sanctions, rather than the war itself, for their woes. It will be something of a Pyrrhic victory if the West helps Ukraine win the war only to find itself singled out by the rest of the world as the cause of a terrible surge in human suffering.
There are direct risks to Europe, too. Just as the Arab Spring triggered the Syrian war and the migration crisis, a fresh wave of conflict and instability on our doorstep is a recipe for disaster. It drives up the risks of state failure and the accompanying plague of rampaging Islamists. It increases the likelihood of people being displaced and trying their luck across the Mediterranean. It ultimately makes all of us less safe.
Debate here is now understandably fixated on fuel bills and the UK cost of living. But these may not be the worst outcomes to follow from the war. There is more pain to come.
Surging food costs could spark another migrant crisis from countries in the Middle East and North Africa