Sri Lanka among top 10 with highest food price inflation

(LANKAPUVATH | COLOMBO) – Sri Lanka is among the top 10 countries with the highest food price inflation.

The latest World Bank assessment places Sri Lanka at number 5 among countries hardest hit by food price inflation.

Lebanon is leading the list followed by Zimbabwe, Venezuela and Turkey.

Iran, Argentina, Suriname, Ethiopia, and Moldova and behind Sri Lanka.

The World Bank said that in Sri Lanka, agricultural production has decreased by 40 percent to 50 percent because of fertilizer shortages, and there is a lack of foreign exchange to purchase food imports.

Fertilizer and fuel (for land preparation, transport, and harvesting activities) shortages are expected to limit the food supply. Some relief is coming from the first shipment of 44,000 tonnes of urea supported by Indian credit.

There has been an increase in demand for Indian rice, with roughly 9.6 million tonnes shipped this year.

Exporters, concerned that export restrictions will be introduced (as has been done for wheat), are moving quickly to open letters of credit and have signed contracts to export 1 million tonnes of rice from June through September 2022. Food price inflation reached 80 percent in Sri Lanka, 26 percent in Pakistan, and 8.3 percent in Bangladesh.

The World Bank said that record high food prices have triggered a global crisis that will drive millions more into extreme poverty, magnifying hunger and malnutrition, while threatening to erase hard-won gains in development.

The war in Ukraine, supply chain disruptions, and the continued economic fallout of the COVID-19 pandemic are reversing years of development gains and pushing food prices to all-time highs.

Rising food prices have a greater impact on people in low- and middle-income countries, since they spend a larger share of their income on food than people in high-income countries.

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