US Treasury Secretary Janet Yellen says the US government and its partners are leading efforts to stabilize global energy prices by introducing a cap on the price of Russian oil, which should help mitigate further price shocks in emerging economies and reduce Russian revenues.
Although the policy is in the early stages of implementation, the US Treasury estimates that it could mean annual savings of about $6 billion for the 17 African net oil-importing countries.
Speaking at an agricultural site supported by the Green Climate Fund in Zambia on January 24, Yellen explained what the fund, the World Bank and the US government are doing to improve food security in Africa, which has deteriorated severely since the emergence of Ukraine. war, as well as climate adaptation, which is generally lagging behind in African countries.
The number of people facing acute food insecurity has risen to 345 million in 80 countries; in Zambia, about two million people face acute food insecurity and nearly half of the population cannot meet their minimum caloric intake requirements, Yellen cites.
She says global food systems have been straining for some time due to a combination of factors, including regional conflicts, climate change and economic disruptions from Covid-19. He notes that strained food systems are most evident in Africa, especially amid Russia’s invasion of Ukraine, which has put more pressure on food, fuel and fertilizer prices.
In addition, Yellen notes that the war in Ukraine has made significant supplies of wheat, corn and sunflower oil more expensive or unavailable. In turn, rising global energy prices have increased the cost of shipping food and other commodities, while the price of fertilizer has hurt agricultural production in African communities.
During the Summit of African Leaders, hosted in Washington, in December, the President of the United States Joe Biden and Yellen met with African heads of state to discuss how the US can refocus its efforts to strengthen food security. Yellen says the US would like to see Africa fully participating in global food and fertilizer markets and supply chains, as well as significantly less dependent on humanitarian aid.
Last year, the US committed $13 billion in humanitarian and food security assistance globally, including $2 billion in life-saving aid in Africa.
The United States has also met with countries and international organizations to avoid export restrictions and impediments to the delivery of humanitarian aid. The United States itself has made sure to exempt exports of food and key agricultural commodities from sanctions programs to further allow the flow of products to global markets.
Yellen confirms that the US government is also working with international financial institutions to increase its food security efforts.
For example, the World Bank is implementing up to $30 billion in projects to respond to the food crisis in Africa. This facility is expected to benefit 20 million smallholder farmers in Africa and enable them to rapidly produce up to 38 million tonnes of wheat, maize, rice and soybeans to meet the continent’s demands.
However, Yellen says, as acute needs are addressed now, entities must also take a longer view and increase investment in long-term food system resilience as climate change is underway.
It notes that storms, floods and droughts in Africa have increased in severity and frequency, damaging agricultural yields as a result. Yellen says farmers are often the first witnesses to climate change and its consequences.
To this end, the US government recognizes the need for Africa to take urgent steps to adapt its agricultural practices and technology to be more climate resilient. The United States is advancing climate adaptation efforts through its latest $155 million contribution to the Global Program on Agriculture and Food Security.
To address long-term food security, Yellen also considers it necessary for Africa to develop its infrastructure and logistics capabilities. In this sense, the G7 Partnership for Global Infrastructure and Investment will mobilize hundreds of billions of dollars over the next five years in a series of global investments in infrastructure.
Yellen stresses the importance of partnerships in solving the continent’s challenges and says the US Treasury remains committed to helping in this regard.
