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Hangover from Covid to last for years, UN food expert says

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The Covid-19 pandemic will for years yet overshadow agriculture markets, as well as international relations, by widening the gap between richer and poorer countries, a United Nations food expert said, cautioning of the potential for “huge conflicts” if divisions are not resolved.

 

Abdolreza Abbassian, senior economist at the UN Food and Agriculture Organization, urged intergovernmental talks to resolve fallout from the pandemic, which could see less developed countries, unable to roll-out rapid vaccination programmes, fall further behind leading economies.

 

“If you’re going to have more inequality, unfortunately far more frictions, more than any other time you will be needing global leaders to get to together, whether it’s under WTO, UN or whatever,” he said.

 

“They need to get to get together and to discuss and to make plans together.”

 

‘Back to haunt us’

While Covid has, on the surface, proved a less significant challenge to agriculture markets than many had feared, with Mr Abbassian saying that the “international flow of food has been actually rather consistent, even increasing”, he added that the pandemic “comes back to haunt us on many… fronts”.

 

The pandemic had, particularly in poorer countries, hampered access to food, as well the ability to afford it, given income lost to Covid effects.

 

“We cannot undermine the importance of how people’s livelihoods have been destroyed by Covid,” he told the Agrimoney webinar Covid, one year on: What’s next for agricommodities?

 

Furthermore, such countries may be ill-equipped to deal with the inflationary pressures many see as being stoked by the “trillions of dollars that have been injected” in a bid to support economies amid the pandemic, he said, noting potential impacts on markets including foreign exchange, as well as food prices.

 

‘Far more polarised’

“So in two or three years’ time, we’re living probably in the world where you’re far more polarised than we were,” Mr Abbassian said.

 

“We probably have far more poor people than we had.”

 

And while some Asian nations, such as China, may achieve growing supplies of “value-added foods”, for many other countries, consumers “probably will go back to some more basic food - rice, wheat, the very basic stuff for which they could still afford to pay for”.

 

‘We’re not out of the woods’

It appeared unrealistic to assume that “we could just live as we did five years from now, with such a heavy shock to the world economy” from Covid.

 

And that transformation may be evident beyond ag markets in factors such as migration too, and the trend for workers from less developed countries to attempt to move to richer nations.

 

“Look at how much stress was on Europe over migration from Africa before Covid.” While this may not be talked about at the moment, African economic conditions had not improved.

 

While OECD countries might have Covid under control by the end of the year, “what about… the other 4bn people?”

 

Without action to resolve inequalities and tensions, “I just don’t think that in two or three years’ time you and I will be sitting here and talking about how much [ag products] Brazil and US are selling to China.

 

“Frankly, I think we will be sitting here worrying about really huge conflicts, wars, all kinds of horrible things” that are often sparked “when distress gets to that level”.

 

He added: “I think we’re not out of the woods. We should in no way pretend that things are just fine and great” despite signs on many fronts that Covid is in retreat.

 

“Solutions have to be global, and they have to be found quicker.”

 

For more on the webinar, please click here.

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