The International Monetary Fund (IMF) cautioned on Wednesday that the suspension of the Black Sea grain pact risks exacerbating global food insecurity and driving up prices, particularly in poorer nations.
The UN-mediated agreement between Russia and Ukraine to allow safe transit of Ukrainian agricultural exports over the Black Sea was canceled earlier this week.
“The termination of the initiative has an impact on food supply to countries that rely heavily on shipments from Ukraine, particularly in North Africa, the Middle East, and South Asia,” an IMF spokesperson told Reuters.
“It worsens the outlook for food security and risks contributing to global food inflation, particularly in low-income countries.”
The pact, according to the spokesman, was vital for global food security since it facilitated grain and fertilizer shipments from Ukraine to the worldwide market, alleviating pressure on international food prices. He went on to say that the lender will keep an eye on the situation in the region and the implications of any developments on global food security.
On Monday morning, Moscow declared its decision to terminate the grain deal, citing the failure of the other parties to satisfy their pledges over Russia’s agricultural exports.
The original accord was backed by a Russia-UN memorandum aimed at reducing sanctions harming Russian exports. The paper demanded that Russia’s agricultural lender, Rosselkhozbank, be reconnected to the SWIFT interbank messaging system, that supplies of spare parts for agricultural machinery be enabled, and that insurance and logistics constraints be abolished. So yet, none of these demands have been met.
Moscow, according to spokesman Dmitry Peskov, would swiftly return to the agreement once its conditions are met. He also stated that Russia is willing to provide grain free of charge to low-income countries severely impacted by food insecurity.
