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World Bank to offer $30 billion as Ukraine war threatens food security

Economy May 18, 2022 09:10PM ET
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© Reuters. FILE PHOTO: The United States Department of the Treasury is seen in Washington, D.C., U.S., August 30, 2020. REUTERS/Andrew Kelly

By David Lawder

BONN (Reuters) -The World Bank said on Wednesday it will make $30 billion available to help stem a food security crisis threatened by Russia's war in Ukraine, which has cut off most grain exports from the two countries.

The total will include $12 billion in new projects and over $18 billion funds from existing food and nutrition-related projects that have been approved but have not yet been disbursed, the bank said.

"Food price increases are having devastating effects on the poorest and most vulnerable," said World Bank Group President David Malpass said in a statement. "To inform and stabilize markets, it is critical that countries make clear statements now of future output increases in response to Russia's invasion of Ukraine."

The bank said the new projects are expected to support agriculture, social protection to cushion the effects of higher food prices on the poor, and water and irrigation projects. The majority of resources going to Africa and the Middle East, Eastern Europe and Central Asia, and South Asia.

These areas are among the hardest hit by the impact of the war in Ukraine on grain supplies. Countries such as Egypt are highly dependent on Ukrainian and Russian wheat and are scrambling for supplies as Russia has blockaded Ukraine's agricultural exports from Black Sea ports and has imposed domestic export restrictions.

The World Bank's plans were the largest component of a U.S. Treasury Department report summarizing food security action plans from international financial institutions released on Wednesday.

The European Bank for Reconstruction and Development plans to make 500 million euros ($523.50 million) available for food security and trade finance for agricultural and food products, out of a 2 billion euro package for Ukraine and neighboring countries affected by the war, the Treasury report said. Ukraine would get 200 million euros and neighboring countries would get 300 million euros.

The International Monetary Fund will provide financing support through its normal channels, which are limited by countries' shareholdings and whether their debt is deemed sustainable.

($1 = 0.9551 euros)

World Bank to offer $30 billion as Ukraine war threatens food security
 

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