>> Dan Turello: Good evening.
Welcome to the Library
of Congress.
I'm Dan Turello.
I work with the chair
programs at the Kluge Center.
And we're thrilled you're
here for this event.
This program is sponsored
by the Carnegie Corporation
of New York.
Carnegie supports the Library
of Congress chairs and US-Russia
and US-China relations.
These are chairs that lead
policy-relevant research
and programs on US relations
with those two countries.
This evening, I also want to
thank the Center for Strategic
and International
Studies for partnering
with us on this event.
Andrew Weiss is both moderating
and speaking this evening.
This year, he is the
Library of Congress Chair
in US-Russia relations.
He is also the James Family
Chair and Vice President
for studies at the
Carnegie Endowment
for International Peace,
where he oversees research
on Russia and Eurasia.
Prior to joining
Carnegie, he was director
of the RAND Corporation's
Center for Russia and Eurasia.
He also served as director
for Russian, Ukrainian,
and Eurasian Affairs on the
National Security Council staff
as a member of the State
Department's policy planning
staff and is policy
assistant in the Office of the
Under Secretary of Defense
for Policy during
the administrations
of Presidents Bill Clinton
and George H. W. Bush.
I want to thank Andrew for
assembling this evening's panel.
Seated on Andrew's
right is Caitlin Welsh.
She is director of the Global
Food Security Program CSIS.
She brings over a decade
of US Government
experience to this role.
Previously, she served on
the National Security Council
and the National Economic
Council as director
of Global Economic Engagement,
where she coordinated US policy
in the G7 and the G20.
Prior to the White House,
she spent over seven years
in the Department of State's
Office of Global Food Security.
Thank you, Caitlin,
for being with us.
And on Caitin's right
is John Elkind.
John is a fellow and senior
research scholar at the Center
on Global Energy Policy at
Columbia University School
of International
and Public Affairs.
From 2009 to 2017, he worked
on international energy
and climate issues at the
US Department Of Energy,
helping to coordinate
energy policy
in the Obama administration
and leading climate
and energy programs
with global partners.
He departed DOE as
assistant secretary
for International Affairs.
As is our custom this evening,
we will be recording
the actual conversation,
the panel conversation.
But once we move to Q&A
and do your questions,
we will cut the recording
and we will be completely
off the record.
So thanks again.
And Andrew, over to you.
>> Andrew Weiss: Okay.
Okay. Thank you, Dan, and thank
you all for joining us tonight.
It's really nice to see
so many people in person
and to do these kinds
of events in person.
It really is meaningful.
I've greatly enjoyed
the opportunity
to do event here a couple
months ago with Dan Turello.
And I very much hope that
we'll have plenty of time
to have questions
and to really engage
in a detailed back and forth.
Before we do that, I'll set
the scene with some questions
and comments for John and
Caitlin to kind of get our heads
around the policy dilemmas
that are facing leaders,
including President Biden, but
that are truly global in nature
and that are going to
affect everyone in this room
and people all around the world.
So let me start with John.
And let's talk about how we
got to where we are right now.
We are at day 140 and
change of a full-scale war
between Russia and Ukraine.
It is a war that if you
had to kind of think
of what would've been the
worst-case outcome other
than sort of overnight
Russian military success
and decapitating and
destroying Ukraine's government.
We're now kind of in
a war of attrition,
which presumably will
last a really long time,
at least that's my
bold prediction,
that this is not going
to be over any time soon.
And that is going to
have a series of impacts
on the world economy, given
not least because Russia is,
on any given day of the week,
one of the world's top two
or three energy-producing
countries.
And the world is now
scrambling to think
about how we ween ourself
off of Russian hydrocarbons.
And so, let's do
it in two parts.
I remember being a young
analyst and getting schooled
by John Elkind on the difference
between the way Russia matters
in global energy
balances in terms
of oil and in terms of gas.
But the immediate crisis
that I know preoccupies a lot
of Americans is gas prices here.
But before we come to that,
let's talk about the role
Russia's gas production plays
because, in some ways,
I feel like we're headed
into a very acute phase
of this crisis based
on what is happening
literally this week,
where Russia is slowly but
surely finding ways to say
to countries that it believes
are causing pain to Russia that,
you know, we used to be a
very reliable supplier of gas
that you used for your
economies and to heat homes
and provide for your prosperity.
But now, maybe that's not so
important to Russia anymore.
So can we talk a
little bit about how
that squeeze is being
implemented
by the Russian government
and what it means
for the knock-on effects both
on the European economies,
as well as ours?
>> Jonathan Elkind:
First of all.
Thank you.
It's a pleasure to be
here and to actually see
so many people in the flesh.
As Andrew said, you know,
we've all done a million Zoom
or other platform interactions
over the last couple years.
And boy, this beats
the heck out of that.
And that's the high
point for the night.
I'm not entirely joking about
that because the picture
that I think we are likely to
spend the next while talking
about is not one that
is filled overflowing
with great uplifting,
encouraging news, right?
This is a really serious time
in the life of this country,
in a life of our allies and
partners around the globe,
and in the life of, you know,
people in all walks of life
and in all places
around the globe.
Already in advance of
Russia's invasion of Ukraine,
energy markets were in a
tight and challenged position.
Why was this so?
Because in the year preceding,
you had had both a
very favorable rebound
from the depths of the
economic hit that were felt
by the macro economy
on a global level
as a result of the pandemic.
And on top of that,
you had a series
of other energy-specific
things that had occurred,
from a very severe
winter of 2020 into 2021,
severe Southern hemisphere
winters as well that called
for additional supplies
of natural gas to a degree
that is unusual in many
of the last say 20,
excuse me, 20 years.
You had other idiosyncratic
things that happened,
like a long period
of summer doldrums
in the offshore wind in Europe.
So lots of scene setting that
was challenging, big growth,
demand recovery, and oops, some
supply shocks on top of that.
Russia's role, particularly
in relation to Europe,
has been a defining element
of the energy supply picture
in Europe for about
the last decade.
It's been the subject of decades
and decades of challenge and,
at times, really
pronounced disagreement
between the US Government
and governments in Europe.
This has been a topic that we've
been talking about with them
for a really long time.
But as a consequence of
Europe's own sinking supply,
sinking production of natural
gas, and growing demand
for natural gas in Europe,
the supply relationship
with Russia creeped from
being around 20% in the 1990s
to being north of 40% in 2021.
So a really very
considerable degree of reliance.
Now, Russia's not the
only supplier into Europe.
And we can talk more about
that later, the opportunities
for supply with liquified
natural gas from the US,
from Qatar, from
elsewhere around the globe,
but a big part of the story.
Moreover, Russia is also about
a third, a quarter to a third
of Europe's oil and refined
product, gasoline, diesel,
jet fuel, et cetera,
supply as well.
So a really big player
in the European market.
And that's before we get to the
effort that unfolded starting
on the 24th of February to
respond to Russia's actions,
in part through energy
policymaking.
>> Andrew Weiss: So now,
let's do that for --
I know it's going to be a little
confusing to keep track of it.
Let's do that for food
because the numbers are not
that dissimilar where you
have two massive sources
of food production in
Russia and Ukraine.
So let's just start at
the baseline, Caitlin,
of how big the contribution
was on February 23rd,
before the war started, and
where that food normally went.
>> Caitlin Welsh: Sure.
Great. Thank you.
Thanks for that question.
And I think we're
on the same page
because I was thinking there
are a lot of similarities
between the scene that
Jonathan set and what I can do
when it comes to food security.
I'll start actually
with the state
of global food security
prior to this,
prior to the war breaking out.
Global food insecurity
leading up to the war
because of what we call the
three Cs, climate change, COVID,
and conflict, was estimated to
reach at least a 15-year high,
that's global food insecurity,
leading up to the war.
And so, that was,
generally speaking,
the state of food insecurity
was not a positive picture.
Russia and Ukraine
are major producers
of very important commodities.
And the way that global
commodity markets work is
that there are exporters, sorry,
the countries that import Russia
and Ukraine supplies
are those that are
in the general geographic
vicinity of those countries.
So, generally speaking,
it's countries in Asia,
the Middle East, and
in Africa that rely
on the Black Sea
for their imports.
Generally speaking, the main
products from the Black Sea,
wheat, maize, oil
seed, so sunflower oil.
Across net food-importing
countries,
there are 50 countries that
relied on Russia and Ukraine
for at least 30% of
their imports of wheat
and 26 countries that
relied on Russia and Ukraine
for at least 50% of their wheat.
So they supplied a
very important amount
of essential commodities for
net food-importing countries.
And to speak about Russia's
role in this in particular,
Russia was a net food importer
at the turn of this century.
And when Vladimir
Putin came into office,
recognized that this was a
liability for the country.
So deliberately invested
in increasing Russia's
agriculture productivity
to the point that they
became a net wheat exporter
and the top exporter
of wheat since 2017.
So they've been the
world's top exporter
of wheat since that time.
Last year, they exported about
40 million metric tons of wheat.
And USDA's estimated
that, this year,
they will also export 40 million
metric tons, which keeps them
at the top as the top
global exporter of wheat,
again tying world
records ever set.
So Russia's incredibly
important in this picture.
And when you take production
offline from Ukraine
and limit access to
Russia's products indirectly
through the effects
of sanctions,
that has further negative
effects on food security
for net food-importing
countries, again starting
from a point where food security
was already quite bad before
the war.
>> Andrew Weiss: Okay.
So now, let's toggle back to
global crude for a second,
which you sort of
touched on briefly, John.
But the scale of Russia's impact
on global crude balances
is also non-trivial.
So can you just quickly
define for people
so we have the same baseline
how important a producer
of crude oil for global
markets Russia is?
>> Caitlin Welsh: Thank you.
>> Andrew Weiss: Pre-war.
>> Jonathan Elkind: Right.
So the global consumption
of crude oil is roughly a
hundred million barrels a day
round numbers, decent
approximation.
Russia was exporting
on the order of 8
and 1/2 million barrels a
day, two global markets.
Some of that is crude.
Some of it is refined product.
So Russia's significance on
global oil markets is huge.
And its oil is going
substantially to Europe.
It's the largest
export destination,
but also to East
Asia to countries
that are our treaty
allies, Korea and Japan,
as well as other
countries around the globe.
China has been a big
purchaser historically.
Certainly, both China and India
have increased their purchases
in the time since
the outbreak of war.
>> Andrew Weiss: So now,
that's all what we
would call left of boom.
That's all like what the world
looked like on February 23rd.
And then the world
shifted almost
in an unrecognizable way based
on the scale of this war.
The humanitarian crisis.
We now have upwards
of 10 million
or 11 million Ukrainians
pushed out of their homes.
We have had untold
numbers of people killed.
We have basically a Russia
which has been pushed out,
rightfully so, out of the global
economy led by the US and Europe
and Japan, where we
have undertaken a series
of economic sanctions,
financial sanctions
to basically tell the Russians
that we will no longer have a
normal relationship with you.
And at the same time that
that policy was implemented,
largely by the G7 countries,
the US plus EU plus Japan,
there was a big carve out
at the day the war began.
And if I'm not mistaken, from
every policy maker who matters
in the world, they emphasized
that they would create a carve
out and that carve out would
focus on Russian oil and gas
and there would still be
channels for countries
to buy Russian oil and gas.
And there was a good sound
reasoning behind that.
And that was precisely
because if you were
to make it impossible
for countries
to access those commodities,
it would've had a clear impact
on prices that consumers pay,
and it would've had
an immediate impact
on our economy's
vitality and prosperity.
So that didn't last
for that long.
And I think the war
started on February 24th.
By the second week of March,
things changed really
dramatically and it became clear
that something had to be done
to basically challenge Russia's
ability to, on the one hand,
conduct a war in Ukraine
and, on the other hand,
get paid handsomely as
prices responded to the worry
in the market that Russian
supply might get interrupted.
Can you walk us through a little
bit of the kind of sanctions
that had direct impact on
flows of Russian oil and gas
at that early stage because the
world now looks even different?
We've gone through
several phases of this,
but just help people understand
why we made that turn.
>> Jonathan Elkind: Right.
So look, in the world
of economic sanctions,
one is always dealing
with instruments that,
let's be Frank, have a degree
of bluntness to them, right?
This is not a scalpel operation.
And there are lots
of opportunities
for unintended consequences.
Economic sanctions may still
be far superior to a situation
where one is in a kinetic
military confrontation
with the Russian Federation.
But we should look with a
sense of realism at the degree
to which one can very
precisely target impacts
and have the desired impact
just when you want it.
So initially, the goal was
make sure that the impact
from sanctions is greater
on them than on us.
The us being the United
States, Europe, et cetera.
And for a while, it looked
like that was actually
working pretty well.
There is often in a case
where new sanctions are
instituted a tendency
for market actors
to over-comply.
That is until they
really understand
where the contours are,
where the limitations are
on what is permissible and
what's not permissible.
Companies will say, you know,
I'm actually not going to touch
that trade because
it's too dangerous.
But exactly as you say, Andrew,
there was a choice made early
on that the first
tools to be reached
for would not be
sanctions against the oil
or gas economies of Russia.
But the trade flows were kind
of an assaulting reality.
And so, there was increasingly
a clamor for sanctions
that would target
the energy sector.
And this particularly came to
the fore as the world learned
about the brutality that
had been visited on Bucha,
the suburb just Northwest
of Kyiv,
where it is clear people
were shot while handcuffed
and not able to defend
themselves,
back of the head material,
and buried in mass graves.
It came after the bombing
of the train station
in Kramatorsk farther
east, where people,
where families were seeking
to get on trains and evacuate,
you know, the war-ravaged
regions.
So the clamor that arose
was a very serious thing.
So okay, then what do you do?
For the United States, the
answer was easy enough,
which was to say that there
would be no importation of oil
or refined product into the
United States from Russia.
But let's be candid.
There was not much
coming in any event.
For Europe, that
question was harder.
And as the now six, and
perhaps coming soon seven,
rounds of sanctions
unfolded and the discussion
about what they would cover
emerged into public discourse,
what happened was something
that's not really desirable,
which is a big exercise
of telegraphing
where Europe might go.
And that has led to some
problems that maybe we can come
to later in the discussion.
>> Andrew Weiss: Okay.
Similarly, in the weeks
after the war began,
I don't think food security
was the central topic
of policymakers' response.
It was rightfully helping
Ukraine have military equipment
to defend itself, dealing
with humanitarian challenges,
imposing these punishing
economic sanctions on Russia.
And it only became clearer
later, if I'm not mistaken,
in March that the world
had a problem on its hands.
And that as the harvest was
coming in, there was no way
to move it out of the Black Sea.
So can you walk us through
some of the predicate, though,
because there was a deeper set
of factors that put those flows
at risk, some of which have
to do with the over-compliance
that John was talking about,
as well as other structural
factors in the food market?
>> Caitlin Welsh: Sure.
Okay. Lots of issues there.
I'll try to tease apart
these different threads.
So let's see.
Talking about sanctions.
Western sanctions, very
deliberately, exempted all
of Russia's agricultural
products from the get-go.
The only exception to
the sanctions regime is
that sanctions did deliberately
target Belarus' fertilizer
sector, its potash
sector actually.
There were some lighter
sanctions put
on Belarus' fertilizer
sector at the end of 2021.
The US and the EU strengthened
those when the war started,
for reasons having to
do with the importance
of the Russian agriculture
sector to global food security.
Again, the United States
and other allies have always
exempted their agriculture
sector and continue
to communicate
that they will continue
to do this
and which is I think quite
interesting in the context
of Russia's own communication
about the reasons
for the global food
crisis that is upon us.
They continue to blame this
directly on Western sanctions,
which, again, I think is ironic
because we're exempting
its agriculture sector.
Main reasons for
increase in food prices
that we're seeing right now and
just for some context on that.
In February, the UN Food
and Agriculture Organization's
food price index reached an
all-time high.
In March, it reached a
second all-time high.
April and May and June
prices started to level off.
But in certain subsectors, they
still remain incredibly high.
So, for example, in the
June food price index,
the global price of meat
reached a historic high ever.
And while cereal prices
are starting to level off,
they're still almost 50% of what
they were this time last year.
So prices are starting to level,
but they're incredibly higher
than they were a year ago.
You mentioned Ukraine's
harvests.
There's a couple different
phases we can think about.
Ukraine's main crop is winter
wheat, which is planted
in the fall, harvested
about this time.
When we hear about the grain
that's stuck in Ukraine's ports,
that's grain from last year
that was ready to be exported.
And that's about 18 to
20 million metric tons
that we're talking about.
There's a harvest that's ongoing
right now that's in question
for all of the reasons we're
seeing all over the news,
direct attacks on
Ukraine's farms,
disruption of labor
supply, et cetera.
The third harvest, the
third phase that I think
about is the harvest that will
be planted this coming fall
for harvest in 2023.
And what we're seeing out
of the USDA's estimates
of about a 50% reduction
in the amount of wheat
that Ukraine is expected
to export next year.
So that's thinking
about the phasing
of Ukraine's agriculture
productivity.
>> Andrew Weiss: So now, do
fertilizer and do the interplay
between John's world
and your world.
>> Caitlin Welsh: Certainly.
>> Andrew Weiss: So people get
the why this is not just limited
to effects on Ukraine.
This is a global
set of challenges.
>> Caitlin Welsh: Well, I mean,
it's global because of the food,
because of prices of wheat
and maize, and oil seed.
So that alone makes
it a global crisis.
One reason that this
crisis is different
from the last major global food
price crisis, which happened
in 2007, 2008, is
because of the implication
of fertilizer in this crisis.
Because fertilizer prices are
so high, that limits the ways
that United States and
other countries can help net
food-importing countries
respond right now.
The response used to be
one that was really focused
on increasing agricultural
productivity in low
and middle-income countries,
but that's more difficult to do
when fertilizer prices
are much higher.
Fertilizer prices were
rising last year already.
I believe that, let me think,
The World Bank was estimating
that they have increased
at least 30%
since the start of the war.
But regardless, fertilizer
prices are high across the board
for all types of fertilizer.
Belarus, again, is a
major supplier of potash.
Russia is a major
supplier of cheap forms
of most types of fertilizer.
While that sector is exempted
from sanctions, as I mentioned
from the phenomenon that
Jonathan was explaining
from over compliance,
what I think
that we are experiencing is
that some firms are wary to deal
with Russia, maybe wary
to deal with Russia
in their food exports
and fertilizer exports,
just again for the sake
of being over cautious.
>> Jonathan Elkind: And
if I might just to put
out the connective tissue.
A lot of the fertilizer
that is produced and applied
around the globe is fertilizer
that is created using
natural gas as the feedstock.
So if you are in a situation
where natural gas
prices are elevated,
you can end up in a
situation where companies,
and this literally
happened in a couple
of European fertilizer
producers back in October,
where they said it does
not make sense for us to be
in the market right now because
the cost of natural gas exceeds
that which we can hope even
in the most crazy world to get
as payment for the
fertilizer that we produce.
So that was -- Again, I remind,
the energy markets were already
in a place of tightness before,
long before the 24th
of February.
>> Caitlin Welsh: And if you
don't mind if I jump into just,
too, just to tie energy prices
to food prices a
little bit more.
Not only is natural gas an input
to nitrogenous fertilizers,
and so as energy
prices increase,
fertilizer prices increase, but
also the price of production,
agricultural production
on farm increases,
the price of transporting
food increases,
the price of cooling
food, et cetera.
A number of reasons
that the price
of food is highly correlated
to the price of energy.
So all of this putting
further upward pressure
on food prices right now.
>> Andrew Weiss: Okay.
So now we've kind of
explained the scale.
>> Jonathan Elkind: Have
we impressed you yet?
>> Andrew Weiss: Scale
of these interconnected
and highly dynamic crises.
Let's talk about policy
response going forward.
And we'll do this quickly.
And then, hopefully, we can open
things up for back and forth
and questions from folks
here around the room.
So as the crisis unfolded, John,
one thing became really clear.
The original theory of the case
behind economic sanctions was
that it would have spectacular
effects on the Russian economy
and it would create
societal pressure.
It would create divisions
inside the ruling circles
of the country.
It would cause the economy
basically to freeze up
and financial system and
other things wouldn't
function properly.
And there were certain
elements to that
in the first few days
and weeks of the war.
But it soon became the case that
as energy prices moved higher
and higher, that even if
Russia was not selling
as much particularly
of the either crude oil
or refined products, not
talking about natural gas,
where the scale for an
immediate, you know,
profit wouldn't -- I mean,
there's not as much
immediate profit to be had.
But where the profit really
is had is in oil and gas,
in oil markets, which
are more fungible.
Russia was able to
make a killing.
And you can measure that by its
monthly basically cash receipts
for sales of crude oil and
products on global markets.
And so, rightfully,
Ukrainians and other countries
around the world looked at this
and said this is
really messed up.
Something has to be done
to avoid letting the Kremlin
profit handsomely at a time
when the world is
in such a crisis
and when Ukraine is fighting
for its very existence.
But the way you do that without
jeopardizing our economy --
And it's a world where all
the things you could do would
immediately affect everyone
because they would
push prices up,
and they would potentially
trigger economic headwinds.
Administration, this
administration,
any European government
really is in a bind.
So can you talk a little
bit about that bind
and the policy options
that have been pondered
to deal with this problem?
>> Jonathan Elkind: Sure.
Look, a couple things.
The oil and gas industry is
an industry where you have
to run to stand still.
What do I mean by that?
In order to sustain
production levels just flat,
you need to continuously invest
in exploration and production
in order keep the pressure
levels in the subsurface,
such that you can withdraw oil,
natural gas, and other liquids
from under the ground.
So there is an ongoing challenge
that the Russian Federation
faces having access to capital,
which no longer includes
capital from most, if not all,
Western companies because they
decided that they did not want
to be part of Russia's
storyline in 2022.
So there's a challenge that is
looming out there that is going
to get more and more difficult
for Russia to respond to.
Now you're right, Andrew, that
for anybody that had the hope
that we would see immediate
economic pain and, even worse,
economic pain that, in
the minds of some people,
could lead to Mr. Putin
no longer being allowed
to stay in office.
That, frankly, in my
opinion, was an overreach.
And I don't think there were
people, I think in this town,
people who are experienced
enough to know
that had that expectation.
I think there's been some
popular discussion in the press
as to whether that's where you
could end up kind of thing.
But I don't think there
was really an expectation
that that was in the cards.
Now, nonetheless, Russia
has been profiting very well
from the uptick in prices.
And why have prices been
going up if there are parties
that no longer wish to
purchase Russia's crude?
Well, because you can kind
of do the math, you know?
X number of barrels
with Y amount
of incremental price
can yield for Russia,
as it has been doing,
a better outcome
than Russia was in before.
So there's an irony in that.
But the sanctions also are
having a second level of impact
in terms of the macroeconomy.
The Central Bank of Russia
has been forced time and again
to intervene in Russia's
macroeconomy,
in part by like dramatically
raising interest rates
in the economy in order to
keep the economy, you know,
kind of marginally afloat.
So my bottom line point here is
anybody that would have hoped
for overnight change in
Russian direction on the basis
of the economic sanctions alone
was diluting him or herself.
I don't think that that's been
what the expectation has been
from the administration.
But there is this very clear
and uncomfortable reality,
which is that Russia is not
feeling a big hit just yet.
Now, last point.
There's an inevitable tension
that arises from an effort
that is fundamentally about
trying to create headwinds
to Russia's exports
of oil and gas.
And that is that that
will raise prices.
And we should not be
surprised by that.
Show of hands.
Now, I'm going to date myself.
How many people in this room
know the term victory garden?
Okay. Right.
Kudos to you who are
younger than old people
like me who do, right?
So I bring up the idea
of a victory garden
because of the point
that in World War II,
there was this sense that
there was a patriotic duty
to do what you could in your
own household economy, right?
That sense of patriotic duty
to reduce how much
energy we use is something
that has not even dawned
on the vast majority
of the American public.
But it is what we are looking
at if our treaty allies,
as is the case today,
are under attack.
Okay. In this case, it's
economic attack if I'm talking
about the NATO allies in Europe.
But make no mistake, this
is not kidding around.
This is a very, very serious
situation, and it's going
to get lots more
serious before it's done.
And we can talk about that
happy thought at a later point.
>> Andrew Weiss: All right.
So I'm going to ask one
last question to Caitlin
and then we'll open things up.
>> Jonathan Elkind: Sorry.
>> Andrew Weiss: Policy
response to manage
and mitigate a crisis
of this scale.
You sat in the White House and
know what the possible extent
of G7 tools are and know what
they can and can't accomplish.
Presumably, and I don't
want to steal your thunder,
there aren't going to be perfect
tools to fix this crisis,
even assuming if the war ended
tomorrow and something went back
to a semblance of the
pre-conflict reality.
Is that a fair estimation?
>> Caitlin Welsh: It is
and also because the crisis
that we're experiencing
right now is one
for which we don't
have precedent.
We have precedent for
sudden food price spikes,
for sudden reductions in
production and exports,
but we don't have precedent
for a food price
crisis that's caused
by a war of this magnitude.
So what's interesting to me
is the response that's being
cobbled together for
lack of a better term
in the G7 and promoted there.
I'm pleased on the one
hand because I sense
that that response, it's quite
comprehensive in the sense
that it addresses immediate
needs through increased funding
for humanitarian assistance.
It addresses long-term
needs through supporting low
and middle-income countries and
their agricultural productivity.
It acknowledges the impacts
on the fertilizer market
by increasing production
of fertilizer where it can,
encouraging precision use of
fertilizer to make best use
of the fertilizer
that we do have.
The financing aspect.
So for the countries that
aren't experiencing the worst
of food insecurity
crises right now
that don't need humanitarian
assistance
but that are net food-importers,
countries like Egypt,
for example, many
countries across North Africa
and the Middle East, East
Africa, et cetera, rely heavily
on wheat imports in particular.
So there are financing options
to help net food
importers like that.
And also, they're
tacking on, of course,
political statements and,
you know, let me think,
agreements to continue to oppose
Russia in a number of ways.
So I'm pleased that the response
is rather comprehensive.
I haven't seen the amount
of funding attached to it
that I would have expected.
The last time a major food
price increase happened, again,
it was in 2007 and 2008.
In response to that, the G8
at the time because Russia was
at table pledged over
$22 billion in support
of global food security.
At this year's G7 summit,
the G7 pledged an additional I
believe 4 billion for a total
of $12 billion this year.
I'll give them some
credit knowing
that the crisis is dynamic.
It's changing.
And so, the response
is probably evolving.
Still, I'm hoping
for more funding
and continued high-level
political attention to this.