A report issued by “Reuters” warned that the outbreak of war against Iran may cause a significant rise in food prices globally, which will lead to a severe economic crisis for developing countries that are still suffering from the effects of the Corona pandemic and the war in Ukraine.
The fertilizer sector represents a major weak point, as about 30% of fertilizers pass through the Strait of Hormuz, which is considered closed by Tehran, and the war threatens between 65% and 70% of the global supply of urea, which led to an increase in its prices by between 30% and 40%.
The chief economist at the FAO warned that the continuation of the conflict for an additional few weeks would lead to a major shortage in supplies of grains, fodder and meat, stressing that very few countries would be able to bear this shortage.
In a related context, Moody’s reported that food and fuel constitute between 30% and 50% of the consumer inflation index in emerging markets, making them more vulnerable to price fluctuations.
In this regard, the Minister of Finance of Rwanda announced a study of taking measures to protect the agricultural sector that depends on Gulf fertilizers, while the European Bank for Reconstruction and Development is considering providing urgent support packages to contain the crisis.
