INTRODUCTION
Even before the Ukraine-Russia conflict impacted global commodity prices, Liberia had long suffered from food insecurity due to a combination of factors, including extreme poverty, endemic inefficiencies in the country's food and agricultural systems, COVID-19, climate change impacts, and high post-harvest losses. In 2018, approximately 18% of Liberian households were identified as moderately to severely food insecure. By 2021, the Global Hunger Index classified Liberia's level of hunger as "serious," with Liberia ranking 110th out of 116 countries on hunger conditions. (ReliefWb, 2022).
Several key drivers of food insecurity in Liberia include low local agricultural productivity, which is exacerbated by limited availability of agricultural inputs, mechanized equipment, financial capital, and extension services. Additionally, Liberia is highly dependent on imported staples, especially rice, with 70% of rice consumed in the country being imported. This makes Liberia vulnerable to global market price shocks. Limited nutritional diversity of local production is another challenge, as local markets for high nutritional value products are underdeveloped due to constraints on both supply and demand sides. Extreme poverty is also a significant factor, as more than 50% of Liberians live below the poverty line ($1.90/day) and are unable to access sufficient food on a daily basis. As of 2022, 38.9% of the population was undernourished, and 45% of deaths in children under the age of five were linked to malnutrition. (ReliefWeb, 2022).
The Ukraine-Russia conflict has further exacerbated the situation by impacting global commodity prices, including those of food and fuel. Since May 2021, there has been an average 8% increase in the price of rice, and since October 2021, there has been an average 42% increase in the price of fuel in Liberia. The conflict has disrupted the global supply chain and contributed to a rise in food and energy prices, putting additional strain on Liberia's already fragile food security situation.
LIBERIA IS NOT ALONE
The Russia-Ukraine war has had a significant impact on African countries, particularly in the areas of energy and food security. As a result of the conflict, a global energy crisis emerged, which has been characterized by a shock of unprecedented breadth and complexity. Global energy prices soared to a three-decade high in mid-2022, with natural gas prices reaching over 300 Euros per megawatt-hour. Although prices have come down significantly by February 2023, African governments did not have the fiscal space to protect consumers from rising energy prices, unlike European governments that implemented wide-scale measures to counter the price shocks (Africa Renewal, 2023).
Inflation reached double digits in 40% of African countries, with seven African countries in debt distress and 14 more at high risk of debt distress. This limited their ability to implement countermeasures. African households, which already spend over 50% of their overall consumption on food and energy, felt the impact of the conflict-induced global energy prices and their indirect effects on transportation and consumer goods costs. (Africa Renewal, 2023).
The global energy crisis also led to policy reversals, with many countries pursuing natural gas and fossil fuel projects to meet their energy needs. This has resulted in renewed interest in natural gas and liquified natural gas (LNG) projects in African countries, mainly for export to Europe and other regions. However, this may not necessarily result in improved energy access for Africans themselves, and it could risk perpetuating commodities-based economies, stunting the continent’s industrialization ambitions.
Africa, despite having over 65% of the world's uncultivated land, is a net food importer and has been severely impacted by the rise in global food prices, resulting in increased food insecurity. Staple food prices in Africa surged by an average of 23.9% in 2020-22, which has devastating implications for Africans who already spend a significant portion of their household consumption on food items. In 2020, several African countries imported a substantial percentage of their wheat from the Russian Federation or Ukraine, and the conflict triggered a shortage of about 30 million tons of grains on the continent, along with a sharp increase in cost. Africa already had the highest prevalence of food insecurity globally in 2020, with 26% facing severe food insecurity and 60% affected by moderate or severe food insecurity. (Africa Renewal, 2023).
Supply chain disruptions of primary farm inputs, including fertilizer imports from Russia, Ukraine, and Belarus, further threatened Africa's food security. Global fertilizer prices have risen significantly, with prices for fertilizers more than doubling in countries like Kenya, Uganda, and Tanzania in 2022. The "Black Sea Grain Initiative" has eased some of the "fertilizer crunch" by allowing the movement of fertilizer exports from Ukraine to the rest of the world. Nevertheless, looking ahead to the 2023-2024 growing season, the price and availability of fertilizers for farmers in Africa will determine how the continent will counter widespread food insecurity. Africa's food production is already hampered due to low fertilizer usage, with an average fertilizer application rate of 22 kilograms per hectare, compared to a world average that is seven times higher (146 kilograms per hectare)5
INSIGHTS LIBERIA'S PREDICTIONS
This is an analysis based on potential trends and factors to consider when forecasting the potential impact of a prolonged Russia-Ukraine war on the political, economic, and social conditions of Liberia in 2024:
Political Impact:
International Relations: Liberia may face geopolitical pressures to align with one side or another in the Russia-Ukraine conflict, particularly if sanctions or countermeasures are imposed by different blocs. This may strain Liberia's diplomatic relationships and affect its access to international aid and support.
Internal Stability:
The economic and social pressures resulting from the conflict and its ripple effects could exacerbate existing political tensions and potentially lead to civil unrest or dissatisfaction with the government's response.
Economic Impact:
Commodity Prices: The prolonged conflict may lead to continued disruptions in global supply chains and sustained increases in commodity prices, particularly for food and fuel. This could strain the Liberian economy and contribute to inflation.
Dependency on Imports: Given Liberia's dependency on imported staples, particularly rice, the country may face challenges in securing adequate food supplies. The conflict could impact global trade routes and increase the cost of importing essential goods.
Limited Fiscal Space: The Liberian government may have limited fiscal space to mitigate the impact of rising prices or provide economic relief to its citizens, particularly if the conflict affects international aid and investment.
Social Impact:
Food Insecurity: If global food prices continue to rise and Liberia's access to imports is disrupted, food insecurity could worsen. Vulnerable populations, including low-income households, may face difficulty accessing sufficient and nutritious food.
Poverty and Inequality: The economic challenges resulting from the conflict may exacerbate poverty and inequality in Liberia. Those living below the poverty line may find it increasingly difficult to meet basic needs, and existing disparities could widen.
Health and Education: Health and education services may face strain as resources are diverted to address economic and social challenges. Austerity measures or funding cuts could impact access to healthcare and education, particularly for vulnerable communities.
It's important to note that these are speculative considerations based on potential trends and should not be interpreted as definite predictions. The actual impact of the Russia-Ukraine conflict on Liberia will depend on a variety of factors, including the duration and scale of the conflict, the response of the international community, and domestic policy decisions made by the Liberian government.
POSSIBLE MITIGATION ACTIONS
As Liberia heads into general elections in 2023 amid potential global energy and food crises due to the Russia-Ukraine war, there are several political and economic actions the government can consider taking in anticipation of an escalated scenario:
Diversify Import Sources: Given Liberia's dependency on imported staples, diversifying import sources can help reduce the risk of supply disruptions. Exploring and establishing trade partnerships with alternative suppliers can help mitigate the impact of global market shocks.
Boost Local Agricultural Production: Investing in and supporting the domestic agricultural sector can help enhance food security. This could include providing subsidies or financial support to farmers, promoting modern agricultural practices, and increasing access to agricultural inputs such as fertilizers and seeds.
Implement Price Stabilization Measures: To mitigate the impact of rising food and energy prices on vulnerable populations, the government may consider implementing price stabilization measures. This could include subsidies on essential goods, price controls, or targeted social safety net programs.
Strengthen Strategic Reserves: The government could consider building or strengthening strategic reserves of essential commodities, such as food and fuel. This would involve stockpiling critical supplies to cushion against potential shortages or disruptions.
Enhance Energy Security: Exploring alternative sources of energy, such as renewable energy, and investing in energy infrastructure can help reduce dependency on imported fuel and increase energy security. Promoting energy efficiency measures can also help reduce energy consumption and lower costs.
Promote Transparent and Inclusive Governance: Transparent and inclusive governance practices are essential for maintaining political stability during challenging times. Engaging with diverse stakeholders, including civil society, opposition parties, and the general public, can help build trust and promote cooperation.
Coordinate with International Partners: Collaborating with international partners, including donor countries, multilateral organizations, and NGOs, can help secure external assistance and support. This may include seeking humanitarian aid, development assistance, or technical expertise to address the challenges arising from the crisis.
Monitor and Communicate: Establishing a task force or committee to monitor the evolving global situation and assess its potential impact on Liberia can help inform policy decisions. Clear and timely communication with the public about the government's actions and contingency plans can help manage expectations and reduce uncertainty.
It's important to note that the effectiveness of these measures will depend on various factors, including the scale of the crisis, the government's capacity to implement them, and the level of coordination and cooperation among stakeholders. Additionally, policymakers should consider the potential trade-offs and impacts of different measures on the overall economy and society.
Sources:
ReliefWeb (2022) Liberia Food Security Fact Sheet (July 2022). Retrieved from https://reliefweb.int/report/liberia/liberia-food-security-fact-sheet-july-2022 on April 17, 2023
Africa Renewal (Feb. 2023) One Year Later: The impact of the Russian conflict with Ukraine on Africa. Retrieved from https://www.un.org/africarenewal/magazine/february-2023/one-year-later-impact-russian-conflict-ukraine-africa on April 17, 20203.
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