Olaf Scholz left on his first trip to Africa as chancellor on Sunday. In Senegal, Niger and South Africa, the SPD politician is likely to be confronted with the accusation that the West’s reaction to Russia’s war is damaging its host countries. The Center for Global Development estimates that more than 40 million people will face extreme poverty this year due to rising food prices. “The poor are paying for the sanctions imposed by the West,” Amrita Narlikar, President of the German Institute for Global and Area Studies (GIGA) recently warned in the Tagesspiegel.
Chancellor Wolfgang Schmidt (SPD) also knows that emerging countries are critical of the sanctions. It is “very important to him that we look beyond the West, the G7,” he said recently at the Federal Academy for Security Policy (BAKS). A front position by the emerging countries against the North must be avoided at all costs. But their own sanctions harm the poor countries ? An overview.
sanctions against goods
The federal government rejects this accusation. The EU sanctions are “deliberately designed in such a way that humanitarian areas are excluded or not affected,” says a spokeswoman for the Development Ministry led by Svenja Schulze (SPD). The only trigger for the food crisis was the “Russian war of aggression against Ukraine”. Up until now, emerging and developing countries have not only sourced wheat from Russia, but also fertilizer and pesticides on a large scale. Sanctions should “exclude food, fertilizer and pesticides or alternative payment methods should be found for them,” says Michael Büntrup from the German Development Institute (DIE).
The Federal Association of Development Policy and Humanitarian Non-Governmental Organizations (VENRO) judges cautiously. “Sanctions are always a double-edged sword,” says CEO Martina Schaub.
aid to poor countries
Schulze, Foreign Minister Annalena Baerbock and Food Minister Cem Özdemir (both Greens) have been trying for weeks to get help so that Ukrainian grain can still reach the world market despite the attacks and blockade by Russia. Together with their partners in the G7, they have launched initiatives to this end. The Ministry of Food is now coordinating a “Food Crisis Task Force” in which the three ministries are working on proposals for the G7 summit in Elmau at the end of June.
Chancellery Minister Schmidt points out that Germany is providing 430 million euros for global food security to encourage the G7 partners to provide more aid. The government must “provide significantly more funds to deal with the global effects of the war and, above all, to make the food systems more crisis-proof overall,” warns VENRO boss Schaub of the budget of the Ministry of Development”.
The VENRO boss argues that a cut in the 2022 budget was prevented. However, the medium-term financial planning still “envisages a significant reduction in funds”. Her summary: “This means that important international targets for eliminating poverty, disease and hunger are a long way off.”
Decoupling from Russian energy
Thorsten Benner of the think tank Global Public Policy Institute (GPPI) says: “The embargoes against Russian oil and gas are a significant part of the problem and help to ensure that prices are rising worldwide”. Therefore, many German activists should “reconsider the moral rigor with which they argue for a global oil and gas embargo against Russia”. The think tank founder continues: “It’s just a very, very bad idea to want to exclude the world’s second largest energy supplier from the market.”
Even a purely European oil embargo would have the effect of further increasing prices, which would please Putin in particular, who would then sell the oil to other countries. Benner recommends setting a maximum price for the oil coming from Russia in a broad buyer cartel with Russia. It could lead “to prices being stabilized globally and the Kremlin’s income being cut”.
International Payments
Western sanctions exclude key Russian banks from the Swift international payments system. This also affects customers of Russian goods or services in poor countries. “Of course, the exclusion from Swift also tends to jeopardize these payments and the financial exchange with emerging countries,” says sanctions expert Christian von Soest from the GIGA Institute in Hamburg.
Although Russia is trying to set up alternative exchange systems with China, they are not yet fully operational. There are also Russian financial institutions such as Gazprom Bank, which continue to process payments. It is more difficult to assess whether, under certain circumstances, direct payments for Russian products are still possible.
investments and loans
Josef Braml, USA expert and Secretary General of the German group of the think tank “Trilateral Commission”, certainly sees collateral damage for poor countries. US Treasury Secretary Janet Yellen is now advising Europeans not to completely boycott Russian oil supplies, “particularly out of self-interest”. “Because the resulting higher oil prices are fueling inflation, which is forcing the US Federal Reserve to adopt a more restrictive monetary policy, which in turn is likely to lead to further slumps on the US stock markets and the US economy,” says Braml.
However, developing countries are far more severely affected than western economies: “As a result of the more restrictive monetary policies of western central banks, they have to reckon with the outflow of international investments.” payment difficulties. “In any case, the danger of simultaneous growth, energy, food and debt crises is already worrying for many developing countries,” warns Braml.
Conclusion
The trigger for the new crisis is Russia’s war and the attempt to use hunger as a weapon so that the flow of refugees will destabilize Europe. But there is much to suggest that the West’s reaction is also damaging poor countries. Sanctions expert von Soest from the Giga Research Institute says: “Comprehensive sanctions have a comprehensive effect, you can’t avoid it.”
What development politicians say in the Bundestag
The development policy spokeswoman for the Greens parliamentary group, Deborah Düring, also rejects the accusation that the EU sanctions encourage hunger. “The export of energy and food from Russia is explicitly not affected by the sanctions,” she says. Rather, Russia is using “hunger as a weapon”. In addition, the following applies: “The fact that the price of wheat, for example, is currently climbing to astronomical heights has mainly to do with speculation on the food markets.”
Not even the opposition Union sees the traffic light coalition making mistakes with the sanctions. “I cannot and do not want to blame the traffic light in this case,” says her development expert Volkmar Klein (CDU): “Russia is blocking exports in order to build up international pressure.” In the Bundestag, only the AfD and the Left Party reject the sanctions.
Ali Al-Dailami, development politician for the left-wing faction, criticizes: “With its sanctions policy, the federal government is consciously accepting that the civilian population will also be affected and is using the sanctions as a means of political pressure against unwelcome rulers.” awareness of the impact of sanctions that exacerbate extreme poverty”.
That is another reason why 35 states, especially emerging countries such as Brazil, India and South Africa, did not condemn Russia’s war of aggression in the UN General Assembly.
Chancellery Minister Schmidt absolutely wants to avoid the emerging countries and their allies opposing those in the G7 industrialized countries in the newly emerging world order. Diplomatic efforts and aid should contribute to food security in poor countries. Such a development, he said during his appearance in front of the security academy, he would find “pretty stupid”.
