The world is facing a growing crisis: rising food insecurity. The consequences of this trend extend far beyond the individual and household levels, posing a significant threat to the global economy. As food insecurity worsens, it can have far-reaching impacts on economic growth, stability, and development.
According to the Food and Agriculture Organization (FAO) of the United Nations, “a person is food insecure when they lack regular access to enough safe and nutritious food for normal growth and development and an active and healthy life. This may be due to unavailability of food and/or lack of resources to obtain food”.
According to the latest report of the State of Food Security and Nutrition in the World (SOFI) published by five specialized United Nations agencies, about 733 million people face hunger in 2023 while an estimated 2.33 billion people globally have food security challenges. The FAO report also states that if the current trend continues, about 582 million people will be chronically malnourished by 2030 with half of them in Africa. This projection is similar to the levels estimated in 2015 when the Sustainable Development Goals were adopted thus indicating that not much progress has since been made in combating food insecurity.
Food insecurity can have devastating economic consequences, as it can lead to reduced long-term economic growth, as households and communities struggling to access basic necessities are less likely to invest in education, healthcare, and other productive activities. It also exacerbates poverty and inequality, as those already vulnerable are disproportionately affected and this can lead to social unrest, migration, and conflict. In Nigeria for instance, which has the highest population of food insecure people in the world estimated at 161.4 million people, conflicts between herders and farmers for the control of land resources have led to a significant decline in agricultural output thus exacerbating the bad situation further.
Food insecurity also results in malnutrition and hunger which can impair cognitive function, reduce productivity, and increase absenteeism, ultimately affecting businesses and economic output. The health consequences of food insecurity, such as malnutrition and related diseases, can overwhelm healthcare systems, diverting resources away from other essential services while trade disruptions, market volatility, and price fluctuations, affecting global food markets and economies may also result as a consequence of food insecurity.
The economic implications of rising food insecurity are far-reaching and can have significant impacts on the global economy, as the World Bank estimates that food insecurity can reduce economic growth by up to 2.5% annually. The United Nations also estimates that food insecurity could push an additional 122 million people into extreme poverty by 2030. The resulting food price volatility occasioned by food insecurity can lead to market instability, affecting commodity markets, and potentially triggering broader economic crises. Food insecurity can also deter foreign investment, as investors are wary of economies vulnerable to food price shocks and supply chain disruptions.
To mitigate the economic impacts of food insecurity, governments, international organizations, and the private sector must work together to promote climate-resilient agricultural practices, improve agricultural productivity, and support small-scale farmers while in the interim they need to establish and scale up social protection programs, such as cash transfers, food assistance, and school meal programs, to support vulnerable populations. They also need to strengthen international coordination and governance on food security, including the development of early warning systems and emergency response mechanisms.
Rising food insecurity poses a significant threat to global economic stability. As the world grapples with this growing crisis, it is essential to recognize its economic implications and work toward sustainable solutions that promote food security, support economic growth, and reduce poverty and inequality.
Oshobi, a development economist, management consultant, and author writes from Lagos, Nigeria.