Economic Impact of Middle East Instability on Global South
EconomicsComments
what happens when the international lenders demand the climate milestones be met anyway?
This mirrors the 2022 fertilizer crisis. Energy spikes didn't just raise fuel costs; they crippled ammonia production, leading to systemic food insecurity in Sub-Saharan Africa.
I disagree that it is a total mirror of the fertilizer crisis. Many regions have since diversified their supply chains, which has reduced their reliance on a single energy source for agricultural inputs.
The claim that these subsidies are directly stealing from hospitals is a bit reductive. During the oil shocks of the 70s, similar subsidies often served as the only available social safety net for the urban poor, even if they stifled long term energy efficiency.
The UNDP report specifically highlights that these subsidies are frequently funded by diverting loans intended for green energy transitions. This means the debt is still being accrued, but the intended decarbonization is being traded for short term price stability.
If a government faces immediate civil unrest due to fuel prices, they might prioritize stability over a ten year climate goal. Hypothetically, the political cost of a collapsed government is far higher than the cost of delayed green infrastructure.
I wonder if this affects the shipping costs for food imports too... if the energy cost is high, does the cost of importing grain spike even more for these countries... that would be a double hit!