Fearing Global Food Crisis, World Bank Mulls Launching Food Fund

The World Bank cautions countries against banning export grains and other food items as it might trigger a global food crisis. Photo by: Miso Lisanin / World Bank

The World Bank has urged countries to refrain from banning the export of grains and other food items, explaining that such bans could trigger a global food crisis.

The warning, issued by World Bank Managing Director Ngozi Okonjo-Iweala, came after an announcement by Russia that it could extend its grain export ban into 2011, Reuters says. Russia banned grain exports following a record drought that hit the Black Sea region. The country is currently the world’s third-largest wheat producer.

Okonjo-Iweala said the recent sharp hike in global grain prices does not constitute a crisis yet. But increased volatility of global food prices would hurt poor countries, she added.

The World Bank is conducting a study of which countries would be most likely affected by a global food price crisis, Okonjo-Iweala said. She added that the bank would launch a food fund in September if the situation becomes worse.

“We don’t see a crisis yet and are hoping to head it off by asking countries not to undertake policies that will precipitate a crisis,” Okonjo-Iweala said, according to Reuters.

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  • Ivy Mungcal

    As former senior staff writer, Ivy Mungcal contributed to several Devex publications. Her focus is on breaking news, and in particular on global aid reform and trends in the United States, Europe, the Caribbean, and the Americas. Before joining Devex in 2009, Ivy produced specialized content for U.S. and U.K.-based business websites.