Soaring food prices or extreme poverty for 1.2 billion people worldwide

At present, global food prices have risen by 36% from a year ago, almost equal to the price peak at the outbreak of the food crisis in 2008. Soaring food prices raise concerns. Zhang Moannan recently published a blog post that the soaring food prices will be unacceptable for the global economy. Excessive increases in international food prices will likely have a huge impact on emerging market countries that need large amounts of imported food. High food expenditures will depress consumer willingness, while higher prices of imported goods than export commodities may also degrade trade conditions. Slower growth will affect the recovery of the global economy.

The article pointed out that there are many reasons for the rise in global food prices, such as extreme weather, food export bans, rising oil prices, and even the turbulent situation in central and northeastern Africa, but fundamental forces are also an important driver of liquidity. The current monetary policy has been completely subject to the United States debt system, and the Fed will continue to carry out quantitative easing. With the superposition of liquidity forces of various stocks, the pressure of global food price increases sharply. World Bank Zoellick pointed out that soaring food prices have pushed the world’s 44 million people into extreme poverty, and if food prices continue to rise by 10% in the future In addition, 10 million people will fall into extreme poverty. If they continue to rise by 30%, then this group will increase by another 34 million people, making the global population of extremely poor population reach 1.2 billion, that is, the income per person per day will not exceed 1.25 US dollars. Since two-thirds of the consumer price index in most emerging economies is basically the price of food, energy, and transportation. The increase in the prices of these projects has actually become a huge social cost in these countries.