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The Russia-Ukraine War: Impact on the Global South

  • Geopolitics
  • 1 Months ago
  • 12 min read
Global South,  Global North,  Energy Security

BRICS summit meeting, July 2018

Sanjay Kumar Pandey
Sanjay Kumar Pandey - Professor, Centre for Russian and Central Asian Studies, Jawaharlal Nehru University, New Delhi

The response of the Global South to the Russia-Ukraine war has been primarily based on historical and economic reasons, as opposed to the Global North which has responded mainly through political and security perspectives.

Introduction

The Russia-Ukraine War has once again highlighted the cleavage between the Global North and South. While it has united the Western democracies and the transatlantic alliance in opposing Russian action, the Global South has not been on the same page in endorsing the Western position. From the very start of the conflict, a group of 35-40 countries, representing more than half of the world’s population, that includes China, India, many West Asian and Latin American countries and 17 countries from Africa has maintained equidistant from the two belligerents. These states abstained during voting at the United Nations General Assembly that sought to condemn Russian action. These and many other countries of Asia, Africa and Latin America have been designated as the Global South or the Third World.

In 1969, an American critic of theVietnam War, Carl Oglesby, denounced the war as “the domination of the North over the Global South.”

He was referring to the geopolitical entity earlier (in 1952) described by French demographer Alfred Sauvy as the “Third World”.1 In April 2022, in the wake of evidence of serious human rights violations in the Ukrainian city of Bucha, 50 members voted against expelling Russia from the Human Rights Council. These countries insisted that, instead of fixing the responsibility for starting the war, the UN should try to bring the conflict to an immediate end. There are many reasons behind the so-called indifference and opposition of the Global South to the Western position on Russia.2 The main concern of the Global South has been the disruption of global supply chains of energy, food grains and fertilisers due to this war as explained below.

Food Security

The most serious challenge has been food (in)security. According to a US Department of Agriculture (USDA) report, in May 2022, Russia and Ukraine were the number one and five top wheat exporters in the world.3

According to another estimate, if wheat exports from Russia and Ukraine are completely stopped; yearly per capita wheat consumption would be reduced by 19 percent in South Asia, 57 percent in Sub-Saharan Africa, 26 percent in Southeast Asia, nearly 39 percent in Central Asia, West Asia and North Africa, and 27 percent in other areas. In terms daily per capita calorie intake, the decrease would be more than 3 percent in South Asia, 6 percent in Sub-Saharan Africa, 2.2 percent in Southeast Asia, in Central Asia, West Asia, and 14 percent in North Africa, and 6.2 percent in the other countries.4

The negative impact on agricultural commodity markets has created pressure on wheat supplies and stocks and consequently on food prices. Ukraine was also the largest Sunflower seed exporter accounting for nearly 20 percent of total world exports.5

From the perspective of continents, Asian countries accounted for purchases valued at $30.8 billion or 42.8 percent of the global total in 2022, followed by African countries at 26 percent while Europe imported only 17.7 percent worth of worldwide wheat. What is more important is that imports from Russia and Ukraine accounted for more than 38 percent of the wheat imported by countries in Sub-Saharan Africa, nearly 23 percent of imports in Southeast and East Asia, and more than 48 percent of imports by countries in Central Asia, North Africa, and the Middle East. This clearly highlights the high dependence of the countries of the Global South on Russia and Ukraine for their food security.6

The problem of food security is most serious for the African countries. With over 65 per cent of the world’s uncultivated land, Africa is still a net food importer, and hence, has been severely impacted by the rise of global food prices due to the war. According to the IMF, staple food prices in Africa “surged by an average 23.9 percent in 2020-22—the most since the 2008 global financial crisis.” On an average, food items account for about 42 percent of African household consumption, reaching as high as 60 percent in countries affected by conflict and insecurity.  One can contrast it with France and the United States, where food items represent 13 percent and 6 percent of household consumption, respectively, according to the United Nations.7

According to the African Development Bank (AfDB), in the year 2020, 15 African countries imported over 50 percent of their wheat products from the Russian Federation or Ukraine (Eritrea, Egypt, Benin, Sudan, Djibouti, and Tanzania imported over 70 percent of their wheat from the region). The UN’s 2023 World Economic Situations and Prospects Report shows that in 2020, 26 per cent Africans are facing severe food insecurity. During the ‘Dakar 2 Summit on Feeding Africa: Food Sovereignty and Resilience’ held from 25 to 27 January 2023, the AfDB reported that this number has increased to nearly one-third (about 300 million people) of the global population that is currently facing hunger and food insecurity.8

Energy Security

A power plant in Moscow, Russia.

A power plant in Moscow, Russia.

Russia has been one of the top energy suppliers in the world. In 2021, Russia was the largest natural gas-exporting country world over, the second-largest crude oil and condensates-exporting country after Saudi Arabia, and the third-largest coal-exporting country behind Indonesia and Australia. Although OECD Europe was the largest importer of Russia’s crude oil and natural gas, countries in Asia and the Oceania region imported most of Russia’s coal exports.9 The EU used to be the largest importer of natural gas in the world and imported 90 percent of its needs in natural gas, of which 41 percent came from Russia, and the rest primarily came from Norway (24 percent) and Algeria (11 percent). The EU also used to import 27 percent of its oil and 46 percent of coal from Russia.10

The European governments could largely shield their citizens from the price shocks following the war by spending more than $640 billion on energy subsidies. However, the weak African economies did not have the fiscal resources to protect consumers from rising energy prices. 

The 2022 World Economic Outlook painted a stark picture of the state of global energy, saying that it is “delivering a shock of unprecedented breadth and complexity.” For the African economies still struggling to emerge from the impacts of the COVID-19 pandemic, this was a bolt from the blue, for which they did not have enough resources to cope with. The situation was worsened due to fluctuations in exchange rates, double digit inflation, and high indebtedness (seven to fourteen African countries are in the high risk zone). The gravity of the situation can be understood by the fact that half of African households, according to the IMF, spend over 50 per cent of their overall consumption on food and energy.11

Fertiliser Crisis

In 2020, the most recent year for which fertiliser trade data are available, Russia and its neighbour Belarus were the world's top fertiliser exporters, accounting for nearly 20 percent of the three major types globally: nitrogen, phosphate, and potash.12As key input in food production, rising fertiliser prices can negatively impact food supply. If farmers limit their use of fertiliser because of higher costs, their yields could decline. Farmers in low and lower-middle income countries tend to use less fertiliser, so reducing the application may further reduce their crop yields. Although by March 2023, fertiliser export prices had returned to levels seen before the invasion, the fluctuation and uncertainty remain.13

At the start of the Ukraine War, fertiliser prices were already high due to increasing demand after the pandemic, during which there was a decline. Moreover, increases in prices of natural gas and coal, key inputs in fertiliser production, also led to hikes in prices. The shortage impacted the small low income countries more than the rest.

Large fertiliser importers from Russia and Belarus were able to diversify their imports. Brazil, the second largest importer of potash, started importing from Canada; Morocco, the fourth largest global ammonia importer, stepped up imports from Saudi Arabia and Egypt. At the same time, Russian fertiliser exports also increased dramatically to countries, such as India. However, smaller low-income countries in sub-Saharan Africa (SSA) faced serious shortfall in fertiliser availability after the invasion. The good news is that fertiliser prices are coming back to 2021 levels.14

Andrei Guryev, head of the Russian Fertilisers Producers Association claimed that Russian mineral fertiliser production and exports in 2024 could recover to their 2021 levels. Russia produced 58.6 million tonnes and exported 37.5 million tonnes of fertiliser in 2021, which fell more than 7 percent to 54.3 million tonnes and exports fell 15 percent in 2022. He further asserted that while the volume of Russian fertiliser exports to unfriendly countries decreased by a quarter, the share of friendly countries in Russian fertiliser exports in 2023 is expected to be 75 percent compared with 70 percent a year earlier. For Russia the countries of Global South, especially India and Brazil are “New priority export destinations”.15

Implications for India

Coming soon after the COVID-19 pandemic, the Russia-Ukraine War has posed both economic as well as diplomatic challenges for India. According to Dharmakriti Joshi, chief economist, Crisil, the conflict had worsened the growth-inflation balance for India. It pushed up crude prices and caused supply side bottlenecks, thereby putting significant upward pressure on inflation. It also raised the fertiliser bill substantially and threatened to derail the budgetary math.16 However, for India, the impact was not felt as much as other major economies. The World Bank and the International Monetary Fund (IMF) have termed India to be a “bright spot”.17 This war also created some economic opportunities for India. As many counties in the world, including the developed North, search for alternatives to China, seen as a close partner of Russia, there is greater focus on India as an attractive destination for investment. Foreign direct investments into India are likely to gather momentum in 2024.18

Conclusion

The Russia-Ukraine War has been a catastrophe, not just for Ukraine, and Russia, but the entire world, due to its negative consequences for global food, energy and fertiliser supply chains, especially for countries of the Global South. At the core of this war are diverse worldviews and national interests of the two involved countries. The attempt by the Global North to frame the war as a conflict between the Western values like democracy and the rule of law and the non-West which pursues its own interests, has not helped the cause of democracy or peace. In reality, the Western nations are pursuing their own interests in the same manner the non-Western countries do.

The position of the Global South was best articulated by India’s Foreign Minister S Jaishankar when he said, “Europe has to get out of the mindset that Europe’s problems are the world’s problems, but the world’s problems are not Europe’s problems.” The prospects of peace will be better served if this ‘new Eurocentrism’ is abandoned and the concerns of the Global South are taken seriously.19 India’s pragmatic diplomacy has been acknowledged by countries not just in the South, but also by many in the Western world.

More than two years since the start of the war, Russia seems to be well entrenched in parts of Ukraine, but its reputation has been greatly compromised. On the other hand, during the last six months, the US and Europe’s double standards on the killing of civilians, bombardment of hospitals and schools in Ukraine compared to Gaza has been exposed.20 Majority of the African, Asian and Latin American countries are opposed to Russian actions, quite a significant number are not ready to openly condemn Russia. The Western alliance seeks to penalise Russia by imposing economic sanctions and bolster Ukraine’s military capability against Russia while the rest of the world is preoccupied with tackling its negative economic consequences.

The response of the Global South to the Russia-Ukraine war has been primarily based on historical and economic reasons, as opposed to the Global North which has responded mainly through political and security perspectives.

(Exclusive to NatStrat)

Endnotes:

  1. Ricard, P., & Paris, G. (2023). War in Ukraine: The revenge of the Global South. Le Monde.fr.
  2. Alden, C. (2023). The Global South and Russia’s invasion of Ukraine. LSE Public Policy Review, 3(1).
  3. The world’s top wheat exporters in 2021. (2022). RadioFreeEurope/RadioLiberty
  4. Mottaleb, K. A., & Govindan, V. (2023). How the ongoing armed conflict between Russia and Ukraine can affect the global wheat food security? Frontiers in Food Science and Technology, 3.
  5. OEC Profile, https://oec.world/en/profile/hs/sunflower-seeds.
  6. Mottaleb, K. A., & Govindan, V. (2023). Op. Cit.
  7. Yohannes-Kassahun, Bitsat. (2023). One Year Later: The impact of the Russian conflict with Ukraine on Africa. Africa Renewal.
  8. Ibid
  9. Europe is a key destination for Russia’s energy exports - U.S. Energy Information Administration (EIA).(2022).
  10. Besson, V. (2022). How the Russia/Ukraine crisis impacts energy industry? KPMG
  11. Yohannes-Kassahun, Bitsat. (2023). Op. Cit
  12. Kee, J. et. al. (2023). Global Fertilizer Market Challenged by Russia’s Invasion of Ukraine.
  13. Ibid.
  14. Hebebrand, C. & Glauber, J. (2023). The Russia-Ukraine war after a year: Impacts on fertilizer production, prices, and trade flows.
  15. Interfax. (2023). Russia could increase fertilizer production 10% in 2024, boost exports – association.
  16. Srivastava, S. (2022, December 28). 22 for 2022: Ukraine war and the India impact. Forbes India.
  17. Times of India. (2023). One year of Russia-Ukraine war: How the conflict impacted Indian economy. The Times of India.
  18. Business Insider India. (2023). FDI inflows likely to rise in 2024 as India remains ’preferred investment destination. Business Insider
  19. Martpork. (2023, May 23). The war in Ukraine, democracy, and the global South: We have a problem - ICDS. ICDS.
  20. Haidar, S. (2024). Two years of Russia-Ukraine war: Has India’s foreign policy changed at all?. The Hindu.

     

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