Financial Crisis Pushes Poor Families Deeper Into Hunger

Poor households all over the developing world are eating fewer and less nutritious meals and many are cutting back on healthcare and schooling for children, according to new WFP research on the effects of the financial crisis. Read WFP call to G8 ministers

ROME -- The five case studies, published as G8 development ministers met in Rome, focussed on Armenia, Bangladesh, Ghana, Nicaragua, and Zambia. But they are intended to illustrate the situation in dozens of countries facing similar challenges.

“In each of the five countries, we were alarmed that projections were for more hunger and struggling. It demonstrates that for those living on less than $2 a day, the financial crisis is accelerating hunger and the worst is yet to come,” said WFP’s Executive Director, Josette Sheeran.

Five case studies

Click on country names to read  executive summaries of the five case studies.

or read 100-word outlines in the news release

baby getting its arm measured for malnutirtion

The starting point for the five case studies was WFP's ESHI index, which identifies countries that will be hit hardest by the financial crisis. Download ESHI factsheet

How is the financial crisis affecting the world's hungry?Download the media backgrounder

Looking ahead to the G8 summit in July, Sheeran called on governments to boost social safety-net programmes. Read News Release

Fewer meals

 WFP food security experts reported that the majority of households in poor countries are coping by reducing the number of meals eaten per day or serving up cheaper but less nutritious foods. Some families are spending less on health care or withdrawing their children from school.

WFP has designed an Economic Shock and Hunger Index (ESHI), which uses economic variables and food security indicators to identify which countries will be hit hardest by the financial crisis. It analysed 126 countries and drew up a “watch list” of countries where factors such as workers’ remittances, exports, debt or exchange rate fluctuations could limit people’s ability to put food on the table. Based on the ESHI index, it initiated five case studies.

Undermine progress

Communities are still reeling from food and fuel price rises which peaked in 2008, said Sheeran, and the present crisis threatens to undermine progress made in the fight against hunger. Prices remain stubbornly high and with the economic downturn, many workers abroad can no longer send home money to feed their families.

“There is a real risk of aggravating chronic hunger, reversing the hard-won gains of recent years,” said Sheeran.

Slide into poverty

The studies found the groups most affected by the financial crisis were unskilled workers in urban areas, families who rely on remittances from abroad, workers laid off from the export sectors and those working in mining and tourism. The worst hit were not necessarily the poorest of the poor, however, but a new group of people who face a downward slide into poverty.
Executive Director Sheeran pointed out that the cost of alleviating world hunger was relatively inexpensive compared to the trillion dollar rescue packages designed to save financial institutions and the automotive industry. In 2009, WFP needs US $6.4 billion to meet the urgent hunger needs of 105 million people.