Libyan armed groups retreat after escalation in Tripoli


DUBAI: When Russian tanks entered Ukraine on February 24, alarm bells started ringing in places even far from the war zone. It turned out that many countries were heavily dependent on the two warring parties for their wheat supplies, with Arab states in the Middle East and North Africa region featuring high on the list.

This is partly why for the governments of Lebanon, Egypt, Tunisia, Yemen and Sudan, as well as international aid agencies, the conflict has felt much closer to home. than geographical distance suggests.

Within days, the fighting had limited Russia and Ukraine’s ability to continue exporting wheat to one of their biggest markets, which depends on low-priced Black Sea grain for a major source. of their staple foods.

Ukraine has closed several of its ports and ship traffic in the Sea of ​​Azov has been ordered to cease until further notice. The effect was immediate.

MENA states that were already experiencing food shortages due to rising import costs, budget deficits and conflict now face an additional challenge. Any suspension or reduction of wheat supplies from Ukraine and Russia will deprive the citizens of some of the world’s most food insecure countries of the ability to produce bread and other basic necessities.

In addition to being major players in sectors such as computer chips, oil, timber, cereals and sunflower oil, Russia and Ukraine together account for more than 14% of world wheat exports and a similar percentage of the world corn market.

A combine harvester picks up wheat in a field near the village of Krasne in the Chernihiv region, north of Kiev, on July 05, 2019. (Anatolii Stepanov / FAO / AFP)

Russia is the world’s largest wheat exporter and Ukraine the fourth, according to estimates by the US Department of Agriculture. Russia, Ukraine and Belarus are also among the world’s leading fertilizer exporters.

Reuters reported, citing traders and bankers, that the war has halted shipments from Ukrainian ports, while financial sanctions have cast doubt on payments for Russian wheat purchases, putting additional risk on the shoulders of governments in the MENA region.

“Everyone is looking for other markets because it’s becoming more and more impossible to buy stocks from Ukraine or Russia,” said a Middle Eastern commodity banker, citing shipping disruptions, new economic sanctions and higher insurance premiums. “The market does not expect Ukrainian and Russian exports to resume before the fighting ends.”

The seaport of Odessa, a Ukrainian city on the Black Sea, where the country’s grain supplies are shipped to foreign countries, has been closed due to the Russian invasion and the grain supply, threatening the supply food from various countries. (Photo by Oleksandr Gimanov / AFP)

In Lebanon, officials expect wheat stocks to run out within a month. In Yemen, which imports 90% of its wheat, there is total panic. Years of drought have created near-famine conditions and left most of the Yemeni population dependent on food aid. The situation has worsened since the Houthis took over the capital Sanaa in 2014.

Last year Ukraine was the second largest supplier of wheat to the UN’s World Food Programme, with much of the aid going to Syria, where nine out of 10 of the country’s pre-war population countries are now at or below the poverty line. , according to the UN.

David Beasley, WFP’s executive director, said a funding shortfall had forced the WFP to halve rations for 8 million civilians, with further major cuts to follow. “And just when you think it’s bad enough, we now have a war in Ukraine,” he added in a video posted on the food organization’s website.

“We get 50% of our grain from the Ukrainian and Russian region. This is going to have a dramatic impact on the costs of food, oil and transport. Just when you think it couldn’t get any worse, it will get worse. It’s disaster after disaster here. It’s just heartbreaking.

Conflict-displaced people receive food aid to meet their basic needs at a camp in Khokha district in Yemen’s war-ravaged western Hodeidah province on January 14, 2022. (Khaled Ziad / AFP )

In Lebanon, images of a looming food crisis were seared into the nation’s memory by the explosions that destroyed the port of Beirut in August 2020. As Lebanon found a new storage site for imported wheat, he must now find new sources of wheat.

Lebanon’s Economy and Trade Minister Amin Salam noted that Lebanon imports around 60% of its wheat from Ukraine and Russia, and said the government had opened talks with France, India and the United States with the aim of sourcing wheat from them, but at a higher cost.

QUICKLYMADE

Ukraine has banned exports of rye, buckwheat, millet, barley, sugar, salts, meats until the end of 2022.

“I couldn’t buy a croissant or a manoushe today,” Beirut resident Elio Alam told Arab News on Thursday, referring to popular Lebanese street food. “I stopped at many stores, and all of them said that they don’t produce the products to save flour to make bread. But even bread is missing in several bakeries.

Given the alarming state of the Lebanese economy, the concerns are twofold: where the government can now source its supplies and how it can pay for them. “The current situation of Lebanese public finances is far from clear due to the total lack of professionalism in their management. It is therefore impossible to determine whether there are still resources within the public treasury,” Riad Saade, president of CREAL, an agricultural research center and consultancy firm in Beirut, told Arab News.

People line up at a bakery in Lebanon’s Nabaa district amid a wave of shortages of basic items due to a severe economic crisis. (AFP file photo)

“Officials could still find ways to secure funding for wheat subsidies from other budget allocations. They will also seek donations, which will have political ramifications. The United States and France could consider supporting the Lebanese population. WFP could also play a role.

“The international market is open and accessible. It is a question of financing the supply and coping with the price which has increased due to the crisis. Australia and Kazakhstan can also be sources of supply.

Saadé, who did not rule out the possibility of bread riots and civil unrest, said: “We could have arrived at a situation where people will have no choice but to revolt.”

Like Lebanon, officials in other cash-strapped MENA governments have struggled to secure alternative grain supplies at affordable prices.

Syrian regime officials held an emergency meeting after the start of the invasion to take stock of national reserves of grain, sugar, cooking oil and rice. Syrian President Bashar Assad’s ministers are reportedly considering cutting the prices of some basic commodities in local markets and rationing oil for the next two months.

People queue outside a bakery in the city of Idlib, in northwestern Syria, on April 24, 2020. (OMAR HAJ KADOUR / AFP)

In addition to existing austerity measures, any cuts would cause more stress and financial pressure for Syrians living in regime-controlled territories. As for those living in rebel-held or Kurdish-administered parts of the country, they rely heavily on cross-border trade with Turkey, Iraq and Lebanon, which themselves have chronic supply problems.

In rebel-held Idlib, one of the Middle East’s most food-deprived pockets, Omar Karim, a laborer and father of three, said his family “already lives on the edge of starvation every day”.

Having lived for many years under Russian bombardment and the Assad regime, Karim fears that his family will soon suffer the ripple effect of another Russian war.

“Russia has managed to trample us and is waging a war inside and outside Syria,” Karim told Arab News. “I don’t know how I’m going to manage to keep feeding my family. What will we eat? Grass?”

Egypt, too, senses the danger coming. Analysts believe that the war in Ukraine could pose a serious threat to the country’s economy, as the price of wheat has risen by almost 50% in recent days.

Conflict-displaced people receive food aid to meet their basic needs at a camp in Khokha district in Yemen’s war-ravaged western Hodeidah province on January 14, 2022. (Khaled Ziad / AFP )

Michael Tanchum, non-resident researcher at the Middle East Institute, said: “Egypt already needs to find alternative suppliers. A further escalation that halts all Black Sea exports could also take Russian supplies off the market with catastrophic effect.

Egypt imports the most wheat in the world and is Russia’s second largest customer. It bought 3.5 million tonnes in mid-January, according to S&P Global. The most populous country in the Arab world has started to buy elsewhere, notably in Romania, but 80% of its imports come from Russia and Ukraine.

“With about four months of wheat reserves, Egypt can rise to the challenge. But, to do so, Cairo will need to take immediate and decisive action, which can be made even more effective with the timely support of its American and European partners,” Tanchum added.

Egypt, the most populous country in the Arab world, buys 80% of its imports from Russia and Ukraine. (AFP file photo)

The war in Ukraine also threatens to increase the cost of cooking oils in the MENA region and in Turkey. A blockage of imports from Russia and Ukraine has sparked panic buying of sunflower oil in Turkey, despite government assurances of commodity availability.

Vessels carrying vegetable oil from Russia, which supplies 55% of Turkey’s import needs, and Ukraine, which supplies 15%, have been stranded in the Sea of ​​Azov. Concerns are likely to mount if war affects this year’s harvest in Ukraine and if sanctions against Russia disrupt payments.

Amid the turmoil and chaos of the past two decades, the threat to food availability in the Middle East has rarely reached alarming proportions. Regardless of the scale of the disruption, officials have always found a way to maintain staple food supplies. The Ukrainian crisis, which plunged the breadbasket of the world into war, is different in comparison. — with contributions from Reuters and AFP

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