Developing countries facing energy crisis, El-Nino, high borrowing costs: UN
What's the story
Developing countries are facing a major crisis due to rising energy costs, the El Nino weather phenomenon, and high borrowing costs. The United Nations Development Programme (UNDP) has called for immediate international support to tackle these challenges. Alexander De Croo, UNDP's administrator, urged "solidarity and global action" ahead of the International Monetary Fund (IMF) and World Bank annual meetings in Bangkok.
Report insights
UNDP report details risks of 'compounding crises'
Ahead of the meetings, the UNDP released a report titled "No Time to Recover," detailing the risks posed by what it calls "compounding crises" of energy, climate, and debt.
The report comes as oil prices have surged back above $100 per barrel in recent weeks amid renewed hostilities in the Middle East.
Crisis impact
Emergency measures shielding poor from high prices at risk
The UNDP report notes that since the Iran war began earlier this year, emergency government measures have shielded up to 130 million of the world's poorest people from high prices.
However, it warns many are now at risk as governments run out of resources needed to keep cushioning their populations against soaring costs.
Poverty warning
De Croo warns of perfect storm hitting developing countries
De Croo warned that many countries are changing their policies and letting price hikes flow through due to lack of fiscal space.
He said, "We are witnessing a perfect storm that could throw tens if not hundreds of millions of people back into poverty."
The worst El Nino climate pattern in perhaps 1,000 years is expected to cause widespread crop failures and increase the risk of extreme weather events.
Financial strain
Developing countries facing high government borrowing costs
The global bond sell-off is pushing up government borrowing costs.
De Croo said, "The cost today for bond financing for developing countries, it's 9%. That is really, really high."
He added that the situation is likely to worsen between now and spring.
"For each of the three things that we mentioned - fuel prices, El Nino and the bond markets - unfortunately for each of those at the moment, we don't see any light at the end of the tunnel."