UN warning: Iran war could push 30 million people into poverty
The head of the United Nations Development Programme issued a stark warning that any war with Iran, and the accompanying military escalation in the region, could have dire economic and humanitarian consequences globally. He noted that these tensions, which have already led to a significant rise in energy and fertilizer prices, could push more than 30 million additional people into extreme poverty, threatening to undo decades of global development efforts.
The historical context of tensions and the impact of any potential war with Iran
The Middle East, and specifically the Arabian Gulf and the Strait of Hormuz, is a vital artery for global energy supplies. Historically, conflicts in this region have led to global economic crises, from the oil crisis of the 1970s to more recent geopolitical tensions. A war with Iran would not only threaten regional security but would also be a global crisis, striking at the very heart of market stability. Iran, by virtue of its strategic geographic location and influence in energy markets, plays a pivotal role in determining oil and gas prices. Any blockade or armed conflict would inevitably disrupt supply chains, driving up production and transportation costs and negatively impacting the prices of essential commodities, including food and agricultural fertilizers, on which developing countries heavily rely.
Disastrous repercussions affecting 160 countries worldwide
In a related context, Alexander De Croo, speaking on the sidelines of the G7 development summit in Paris, articulated the scale of the impending tragedy, stating: “It took decades to build stable societies and develop local economies in many developing countries, and it only took a few weeks of conflict to destroy all of that.” This statement highlights the fragility of global economic systems in the face of sudden conflicts.
De Croo continued, explaining the scale of the disaster: “We conducted an in-depth study six weeks after the escalation of tensions began, and we estimated that even if the conflict had ended then, 32 million people would have been forcibly pushed into a state of economic vulnerability and weakness across 160 countries.” He explained that intensive discussions are already underway within the IMF and the World Bank to explore mechanisms for mitigating these economic shocks and to try to establish financial safety nets for the most affected countries.
The regional and international impact of the repercussions of the Iran war
would not be confined of a war with Iran to the Middle East, but would extend to entire continents. The United Nations Development Programme warns of a profound and direct impact on sub-Saharan African countries, which already face numerous developmental and economic challenges. The devastating effects would also reach some Asian countries, such as Bangladesh and Cambodia, whose economies rely heavily on affordable energy imports to power their industrial and agricultural sectors.
Furthermore, developing island nations will be severely affected, as they rely on imports to meet their basic needs and are typically the most vulnerable to fluctuations in shipping and energy prices. Rising fertilizer prices will lead to a decline in global agricultural production, threatening a food security crisis that could exacerbate hunger and malnutrition. This complex situation demands urgent international intervention to prioritize dialogue and diplomacy, and to prevent the region and the world from sliding into a humanitarian and economic catastrophe from which recovery may take decades.
