The war in Ukraine, in all its dimensions, is producing alarming cascading effects to a world already battered by COVID-19 and climate change. Serious damage is being done to the global economy, and particularly to vulnerable people and developing countries.
The United Nations Secretary-General has established a Global Crisis Response Group on Food, Energy and Finance in the UN Secretariat, with the following policy recommendations:
- On Food: We urge all countries to keep markets open, resist unjustified and unnecessary export restrictions, and make reserves available to countries at risk of hunger and famine.
- On Energy: The use of strategic stockpiles and additional reserves could help to ease the energy crisis in the short term. But the only medium- and long-term solution is to accelerate the deployment of renewable energy.
- On Finance: We need urgent action by the G20 and international financial institutions to increase liquidity and fiscal space so that governments can provide safety nets for the poorest and most vulnerable.
UNCTAD will co-lead the workstream on Finance and coordinate the work of all three workstreams.
Statement by UNCTAD Secretary-General on the situation in Ukraine
The war in Ukraine has a huge cost in human suffering and is sending shocks through the world economy.
I want to express solidarity with the millions of men, women and children impacted and displaced by the invasion of Ukraine and I echo the call made by United Nations Secretary-General António Guterres for the conflict to stop now.
This crisis, coming during the global COVID-19 pandemic, is accelerating existing vulnerabilities and widening inequalities across the world.
All countries will be affected by this crisis, but developing countries already hit by the COVID-19 pandemic, rising debt and climate change will be hit especially hard by disruptions in food, fuel, and finance.
Soaring food and fuel prices will affect the most vulnerable in developing countries, putting pressure on the poorest households which spend the highest share on their income on food, resulting in hardship and hunger. This is cause for great concern, as social and political stability and increasing food prices are highly correlated.
Countries, already under severe pressure due to the costs of the pandemic, will see disruption in trade, deficits widen and investment contract. Additionally, significant increase in oil and gas prices can shift investment back into fossil-fuel-based energy generation, which risks reversing the trend towards renewables at a time of acute climate crisis.
All these shocks threaten the gains made towards recovery from the COVID-19 pandemic and block the path towards sustainable development. UNCTAD is committed to supporting developing countries to face these shocks and protect the wellbeing of their populations, specially the most vulnerable.
The impact of the cost-of-living crisis on people
The war in Ukraine has led to a global cost-of-living crisis, which is rapidly constraining household budgets. As food prices rise, incomes at home fall. This has important implications for poverty and hunger levels, educational attainment and energy access.