China And India’s GDP Will Be Hit Hardest By Global Food Price Shock
Report published by UNEP and Global Footprint Network ranks countries on the economic risks they face from a hike in food prices
If global food prices double then China could lose $161 billion in GDP and India could lose $49 billion, according to a new report released today by the United Nations Environment Programme (UNEP) and Global Footprint Network.
The UNEP-Global Footprint Network report, entitled ERISC Phase II: How food prices link environmental constraints to sovereign credit risk, features a table that ranks countries according to how badly they will be affected if global food commodity prices double. The report is available at http://www.unepfi.org/fileadmin/documents/ERISC_Phase2.pdf.
In the future, the world will likely suffer from higher and more volatile food prices as a result of a growing imbalance between the supply and demand of food, the report notes. Rising populations and incomes will intensify the demand for food while climate change and resource scarcity will disrupt food production.
The report, which was published in collaboration with Cambridge Econometrics and several leading financial institutions, models the impact of a global food price shock on 110 countries to assess which countries face the greatest economic risk from this growing imbalance.
In terms of the highest percentage loss to GDP, the five countries that will be worst hit if food commodity prices double are all in Africa – Benin, Nigeria, Cote d’Ivoire, Senegal and Ghana. But China will see the most amount of money wiped from its GDP of any country – $161 billion, equivalent to the total GDP of New Zealand. India will see the second highest loss to GDP – $49 billion, equivalent to the total GDP of Croatia.