The cost-of-living crisis has impoverished 71 million people
Seventy-one million people have fallen into poverty because of the high cost of living. Here's what needs to happen:
The global cost of living crisis, according to the United Nations, is pushing 71 million people into poverty. And now, there needs to be a global effort to help protect the poorest people from the effects of quickly rising prices.
The UN has asked for a stop to debt payments so that governments can give their people free food and energy. It also asked leaders to protect supply lines so that the millions of people who are struggling because of the cost of living crisis can get the things they need.
The call came after the UN Development Programme (UNDP) released a report that showed an alarming rise in poverty during the recent rise in prices.
It said that humanitarian and development help was needed around the world.
Achim Steiner, who runs the UN Development Programme (UNDP), said, "New international efforts can stop this vicious economic cycle and save lives and ways of life."
Problems in the supply chain caused by the pandemic and a lack of grain and energy because of the war in Ukraine have led to the current crisis. Everything from bread and meat to transportation and heating has become more expensive because of this.
Climate change is making it harder to solve the problem because it is making it harder for many people to grow crops or make products that can bring in money and food.
The UNDP report showed that by the end of May, the price of natural gas had gone up by almost 170%, the price of wheat had gone up by 64%, and the price of cooking oil made from sunflower seeds had gone up by 42%. Urea, which is used to feed plants, has gone up by 179%. Most of these price hikes have happened since Russian troops moved into Ukraine. Between half and two-thirds of these prices, increases have been seen.
Inflation is a problem for everyone. But a study by the World Economic Forum found that the global cost of the living crisis was making life a lot harder for a quarter of people in the developed world.
Those with the least money are the ones who feel its effects the most. In the three months leading up to June, 71 million more people in 159 developing economies fell into poverty, according to a report from the UNDP.
The International Monetary Fund says that inflation in the developed world will be 6% in 2022, but it will be 9% in the developing world.
Steiner said, "We are seeing an alarmingly growing gap in the global economy." "Whole developing countries are in danger of falling behind as they struggle to deal with the ongoing COVID-19 pandemic, crushing debt levels, and now a worsening food and energy crisis."
It can take years to stop inflation. In the meantime, the UN has asked governments and financial institutions like banks to help. Debt relief programmes are one thing they can do. This means that they would forgive or delay some credit payments to give money to the governments of the worst-hit countries so that they can help their poor.
That could help them pay for energy subsidies or give cash to families so they can buy food. The UN said that other cash transfers, like tax rebates, should also be thought about.
The report said, "We find that targeted and time-bound cash transfers are the best way to deal with the effects."