The global cost of living crisis
1 in 9 people around the world are supported by money that is sent to them by family or friends living in other countries. These are called remittances and they are a lifeline for millions, supporting household spending on things like food and energy.
Right now, the cost-of-living crisis is affecting many of us. From Beirut to Birmingham, people are struggling to cover the essentials and in March this year, global food prices in real terms reached an all-time high.
These issues are especially acute in the Horn of Africa. In Somalia, the price of milk, critical to child survival, rose by 140% in six months at the start of 2022.
Coupled with issues of importing grain and fertiliser due to the war in Ukraine, ongoing conflict, and the worst drought in 70 years, the country is facing catastrophic levels of food insecurity.
Right now, more than half of all children under 5 in Somalia are estimated to be suffering acute malnutrition. That’s when your muscles begin to waste away, your vision blurs, your immune system becomes dangerously weak and eventually your organs shut down.
Humanitarian support
Against this backdrop, the UK has cut its support to Somalia, from £233 million in 2020, to £90 million so far in 2022.
Aid is lifesaving. It means humanitarian organisations like Save the Children can distribute peanut paste across rural communities to bring children back from the brink of death.
But aid is only a part of the picture and won't solve the long-term problems, the broken food system, the rising global temperatures and the ever-widening gap between rich and poor.
Remittances contribute a third of total GDP in Somalia, and amount to over three times the official development assistance and foreign direct investment worldwide. If UK remittances to Ethiopia, Kenya and Somalia were free from costs for one year, £63 million more would go to families living there.
That’s almost double the UN’s response fund.
With yet another famine looming, now has to be a turning point for actually tackling these man-made choices, exacerbated by poor political choices.
Joining up
That’s why, this month, we’ve launched a collaboration with four global remittance companies. Dahabshiill, Moneygram, Ria and Talk Remit. They are stepping up to reduce the fees they take when people are sending money to countries facing food insecurity.
It’s a helpful short-term measure but longer-term solutions, where banks, Governments and development partners all step up to reduce the costs to remit need to be on the table. This would also help achieve the Sustainable Development Goal of reducing the cost of transferring money from 7% to 3% by 2030.
It’s great to see four major companies step up to tackle the global hunger crisis in this way, and we call on others to join them. If you’re a business and would like to support please get in contact [email protected].
