Soaring food, fuel ramp up social unrest risk for emerging markets -report

Value Exchange International

11/05/2022 06:00

By Jorgelina   do Rosario
    LONDON, May 11 (Reuters) - Rising fuel and food prices look
set to stoke an "inevitable" rise in civil unrest, with
developing middle-income countries such as Brazil or Egypt
particularly at risk, a report by a risk consultancy said.
    Three quarters of nations expected to be at high-risk or
extreme risk of civil unrest by the fourth quarter of 2022 were
middle-income countries, as defined by the World Bank, Verisk
Maplecroft said in an update to its political risk monitor.
    "Unlike low-income countries, they were rich enough to offer
social protection during the pandemic, but now struggle to
maintain high social spending that is vital to the living
standards of large sections of their populations," the report
found https://www.maplecroft.com/insights/analysis/cost-of-living-crisis-inflames-civil-unrest-risks-in-emerging-markets.
    Argentina, Tunisia, Pakistan and Philippines were also among
the countries to watch in the next six months, the authors said,
pointing to their high dependency on food and energy imports. 
    Russia's war in Ukraine has accelerated a rise in food
prices, which hit an all-time record in February and again in
March. Energy prices also rose sharply.  urn:newsml:reuters.com:*:nL2N2X12RV  O/R 
    "With no resolution of the conflict in sight, the global
cost of living crisis will continue deep into 2023," the report
said. 
    Lebanon, Senegal, Kenya and Bangladesh face similar
pressures.
    The report pointed to Sri Lanka and Kazakhstan as examples
of middle income countries that have already suffered unrest
this year. The former saw rising food and fuel prices contribute
to escalating tensions, while an attempt to cut fuel subsidies
sparked protests in Kazakhstan.  urn:newsml:reuters.com:*:nS0N2VC00E
    Civil unrest could hamper a potential economic recovery but
also deter investors focused on environmental, social and
governance (ESG) factors, it said. 
    "Some countries risk falling into a vicious cycle, whereby
worsening governance and social indicators make them ESG
investment pariahs, impeding the inflows needed to improve
economic performance and address societal needs."
    The report found that more than 50% of the almost 200
countries covered by the index have experienced an increase in
civil unrest since the COVID-19 pandemic hit.    

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Ten countries to watch    https://tmsnrt.rs/3MZX8iu
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 (Reporting by Jorgelina do Rosario; Editing by Karin Strohecker
and Richard Pullin)
 ((jorgelina.dorosario@thomsonreuters.com;))