The strong dollar continues weighing on gold appetite, say analysts
Russia’s attack on Ukraine threatens to cause more disruption to the global food system by dramatically increasing the cost of staple foods and the energy required to transport them.
The Black Sea region is responsible for the export of at least 12 per cent of global food calories, so cutting off access to it will have far-reaching effects.
Food prices already were soaring as a result of post-pandemic market imbalances and supply-chain pressures, together with climate-related output losses. By the end of last year, the crunch in the global market for wheat and maize had driven up food inflation in Sub-Saharan Africa by 11 per cent. Now, poor countries face another shock at a time when they have little room to accommodate it.
Even before the economic crisis caused by the Covid-19 pandemic, vulnerable households in developing countries committed a large share of their budgets to food. Additional increases in the cost of food could lead children in these households to suffer significant and irreversible nutritional losses. They could go to school hungry or even drop out to help supplement their families’ income. Given the massive learning losses children in low- and middle-income countries (LMICs) suffered due to pandemic-related school closures, any additional disruption could have devastating consequences.
Fortunately, most countries have a tried-and-tested tool to protect their most vulnerable children in these circumstances. School-meals programmes are considered the largest social safety net in the world. Before the pandemic, such programs reached 388 million children in 161 countries.
There is extensive evidence that provision of school meals is an important tool to keep poor and vulnerable children in the classroom in food-insecure areas. This is true even during systemic shocks such as droughts that may affect overall food supplies. Many developing countries recognised the value of school-based meals as a social-protection instrument when global food prices soared in the wake of the 2008 global financial crisis. Over the past decade, a growing number of LMICs have incorporated school meals into their national budgets as a cost-effective way to enhance schoolchildren’s health and education outcomes.
In the context of rising food and fuel prices, the bulk purchase of food and preparation of meals at a school can potentially generate economies of scale and efficiency that contribute to overall cost reductions. A recent study based on the National School Lunch Programme in the United States shows that school-based nutrition programmes contribute to lower prices at grocery outlets by reducing private purchase of food items.
Countries exposed to the negative effects of the current turmoil in food and energy markets must work to strengthen such programs. But delivering nutritious school meals to a significant portion of the student population consistently can nonetheless be prohibitively expensive for countries with limited resources. A rough calculation based on data from the Global Child Nutrition Foundation indicates that to broaden the coverage of school-meals programs in LMICs to the current global median level could require the equivalent of 5 per cent of a country’s overall education budget.
One of the first actions countries can take to stabilise and potentially expand school-meals programmes is to improve efficiency and ensure accountability in existing schemes. Developing countries have experienced many noble public-sector initiatives that began with great promise, only to succumb eventually to mismanagement and eroded public trust.
School-meals programmes involve extensive public procurement, an area in which many developing countries have substantial weaknesses. To help maintain organisational and financial integrity, therefore, officials should commit to subjecting such programs to routine independent audits.
Effective targeting is also crucial, particularly at a time when global prices are high and the gains from optimising existing resources can be limited. Poorly targeted interventions can leave a programme’s intended beneficiaries even further behind. Moreover, attempts to expand school-meals programmes too quickly can end up straining financial and organisational capabilities, undermining existing operations.
Encouraging governments to improve their school-meals programmes should be matched with support from development partners to provide financial relief, especially in light of the looming debt crisis threatening a number of countries. Currently, many LMICs’ national budgets are burdened by debt-service payments, which in some cases consume close to half of total government revenues. In these circumstances, programmes such as school meals often are the first to be eliminated or downsized. For example, mounting debt recently forced Ghana to suspend a planned expansion of its school-meals programme.
One way for the international community to help countries grappling with the twin crises of food inflation and excessive debt is to promote debt-for-development swaps such as the one the World Food Programme brokered between Mozambique and Russia in 2017. Although the process of negotiating these swaps is too slow to meet needs in an emergency, they can be a powerful tool to facilitate the long-term allocation of more resources to school-meals programmes in highly indebted countries.
As geopolitical crises and climate disasters dominate the headlines, an entire generation of poor and vulnerable children in places far from the spotlight risks falling through the cracks. Keeping these children in school and well-nourished is the least the global community can do to prepare them for an uncertain future. — Project Syndicate
Biniam Bedasso is a senior research associate at the Centre for Global Development.
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