A drop in maize shipments from Ukraine, the world’s fourth-largest exporter, could hurt Egypt, which gets 26% of its maize imports from there
All this may mean not just hardship, but also unrest. President Anwar Sadat tried to do away with Egypt’s bread subsidy in 1977; he reversed his decision within days, after riots that had to be quelled by the army. Ethiopia’s revolution of 1974 followed an oil-price shock, which saw taxi drivers take to the streets in protest. Higher food prices in 2008 and 2009 helped set off the revolts of the Arab spring, and protests that eventually led to the toppling of Omar al-Bashir in Sudan in 2019.
Abdel-Fattah al-Sisi, Egypt’s authoritarian president, has never liked the bread subsidy. “It’s unreasonable to sell 20 loaves of bread for the price of one cigarette,” he said last year. Soaring prices would give him an excuse to try to change it. But he may not like the reaction. Almost one-third of Egyptians live below the paltry official poverty line of 857 pounds a month.
Disruptions in Ukraine will also hit some of Africa’s fastest-growing countries, many of which have already been slammed by soaring inflation. Across sub-Saharan Africa food makes up roughly 40% Higher food prices hurt the urban poor most of all, since they tend not to grow their own. This matters for political stability. Urbanites are more densely packed and closer to the seat of government than their rural cousins. So riots in cities can overthrow governments.
An immediate consequence will be higher inflation. Transport prices were already the biggest cause of headline inflation in Kenya, Ghana and Rwanda last year. In Nigeria, where annual inflation is running at close to 15%, transport and food costs, both of which are spiking, make up 57% of the inflation index.
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