Salvatore Capasso, Giovanni Canitano (a cura di)
Mediterranean Economies 2023
DOI: 10.1401/9788815411167/c9
The fallout from the war in Ukraine also affects other components of the WEF nexus as the MENA is one of the world’s most water-scarce regions. While its population represents about 6 per cent of the world population, its share of freshwater is limited to only 2 per cent [IRENA 2015].
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Water scarcity, associated with constraints on agriculture land and productivity, makes the region one of the most food import-dependent areas in the world. Indeed, MENA countries have acutely felt the impact of disruption from the Ukraine conflict to global food production and exports. However, fiscal disparities between oil exporting and importing countries are equally marked also in terms of food security, with oil-rich states enjoying far greater purchasing power than their regional peers. Although oil-rich countries, such as the Gulf States, import between 80-90 per cent of all the calories they consume, and in some food categories, like cereals, they import 100 per cent of their needs, higher energy prices have largely cushioned them from food price spikes, allowing them to buy agricultural commodities at any cost, without placing an excessive burden on public finances. In contrast, in the energy importers, dramatic inflation in both their food and fuel import bills has penalized them significantly in terms of food accessibility and affordability [Saab 2017]. Not only do they have to pay for more expensive food imports, but their heavy dependence on wheat imports from Russia and Ukraine makes them especially vulnerable to the collapse of food exports from the Black Sea region. Before the war, Egypt, Lebanon and Tunisia imported respectively 80, 70 and 50 per cent of their wheat needs from Russia and Ukraine [Laborde and Mamun 2022]. Other MENA countries that are reliant on imports of key food products from Russia and Ukraine include Turkey, Syria and Libya.
Although the MENA countries are looking for alternative markets for their cereal supply, particularly India, the USA, Canada, Argentina and Uruguay, the shift is not immediate and free of costs due to longer shipping distances and the rise in fuel prices.
Soaring costs for food staples have threatened household-level food security in several import-dependent MENA countries, putting people’s resilience at «breaking point», as the UN’s World Food Programme has pointed out [WFP 2022]. In Egypt, the world’s largest importer of wheat, this is especially true. The country consumes around 21 million tons of wheat every year, 13 million of which are imported. Egypt heavily relies on wheat to provide subsidized bread to more than 60 million people, and higher food and energy prices undermine the government’s ability to pay for the $5.5 bn in food subsidies that keep the price of bread within the reach of Egypt’s poor [WFP 2022]. {p. 320}
Guaranteeing food affordability is a matter of food security and political stability since food subsidies have historically helped governments strengthen the legitimacy of their rule in the absence of meaningful political participation. Today, many analysts fear current food inflation and the consequential impact on the State’s budget risk destabilising the country, as a considerable share of the population would be affected directly or indirectly by higher prices.
With the global food crisis set to worsen in 2023 and, above all, in a scenario of increasing climate variability, which portends the spectre of multiple breadbasket failures, MENA governments perceive the dangers of the region’s dependence on food imports and the urgency of adopting effective measures to address food insecurity at its roots. In the first instance, this will require diversifying away from a concentration of grain imports from any single region, notably the Black Sea. Furthermore, in response to food security concerns, several countries may be driven to abandon a trade-based food security strategy by increasing their share in food self-sufficiency, neglecting the principles of environmental sustainability and amplifying the trade-off within the WEF nexus.

4. WEF policy options to minimize repercussions in the Mediterranean region

As shown above, the Ukraine war, associated with climate change impacts, is significantly affecting energy and food security with direct and indirect consequences also for water resources.
Several policy responses to tackle the Ukraine crisis have contributed to severe market distortions, exacerbating global price increase and instability. Indeed, as countries take action to respond to high prices and other fallout from the war, they should take care to avoid exacerbating the impacts for others. As previous food price spikes have taught us, the best way to deal with market shocks is to allow markets to work by removing distortions and support the most vulnerable countries and households via social safety nets and, where most needed, through humanitarian assistance.
Furthermore, since water, energy and food security are inextricably linked and the WEF nexus includes the sectors mostly affected by the Ukraine war, policy response in «silo» to ensure {p. 321}the supply of one nexus resource without considering the interdependence of water, energy and food security may amplify rather than reduce negative externalities, risking fuelling a vicious circle that ends up favouring trade-offs rather than amplifying synergies between sectors. Consequently, effective solutions able to guarantee the supply of such resources, minimizing repercussions throughout the nexus, should be envisaged.
The MENA countries have responded differently to the food security challenges posed by the Russian-Ukraine war depending on existing environmental, socio-economic and institutional contexts. In addition to some of the instruments that have already been implemented, there are additional short, mid, and long-term measures that countries should consider both on the supply and demand sides.
In the very short run, protecting vulnerable households against food price hikes is crucial. Social safety nets can be practical tools to support low-income people against this crisis and several countries are expanding existing social protection programmes to cover more households [WFP 2022]. In particular, a cash transfer system to poor households, which is proven to be effective and more cost-efficient than food subsidies and in-kind food distribution as successful Egypt’s Takaful and Karama programmes have shown, should be reintroduced [Breisinger et al. 2018].
In the short term, countries should diversify their wheat supply, carefully weighing the costs and benefits of such an «insurance» mechanism since wheat supply from the Black Sea usually comes at lower costs compared to other regions such as Europe or the USA. In Egypt, for example, the General Authority for Supply Commodities (GASC) is actively exploring the diversification of import sources [13]
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In the longer term, countries need to explore food security strategies to balance the benefits of trade openness with the potential costs of vulnerability to trade shocks. In a scenario of increasing food market instabilities, MENA governments may start to consider greater levels of domestic food production as part of their national aggregate food security policies. Although from a political and strategic point of view such an approach may be justified in that it can help stabilise domestic food prices and reduce vulnerability to international markets and reliance on other countries, it comes at an economic cost. This is because the resource endowments of most MENA countries are not well suited to food production, particularly cereal production, and their comparative advantages lie in other economic activities. To overcome such barriers, countries should focus on what could be called «macro food sovereignty» by combining self-sufficiency and trade-based food security strategies incentivizing the cultivation of local species of crops more suited to their geoclimatic condition [Quagliarotti 2023]. Countries could thus help build more sustainable and diverse food systems, enhancing levels of agrobiodiversity and improving nutritional outcomes while helping diminish MENA region’s over-dependence on food imports. However, boosting domestic crop production may be challenging even in countries with opportunities to expand arable areas because agricultural systems must adapt to address water shortages and climate change. This suggests the need for additional research and efforts to increase the production of alternatives to wheat, including drought-tolerant sorghum, millet and high value export crops, and to support climate-resilient farming systems such as drip irrigation and solar-powered irrigation systems [Abay et al. 2023].
On the demand side, there are important differences among countries in terms of their potential to reduce reliance on wheat. Reducing the high consumption of wheat has significant potential in Egypt where the average annual consumption is about 145 kg per capita, double the global average. Shifting consumption from wheat to a more diverse set of food products can serve a dual purpose: improving Egypt’s wheat self-sufficiency and addressing malnutrition [FAO 2022] [14]
. Another threat to food {p. 323}security for the MENA region is food loss and waste. Reducing food loss and waste across the entire value chain, from the early stages (production, handling, processing and distribution) to the consumer and retail levels, would help reduce expensive food imports, freeing up fiscal resources to fund social safety nets for the most vulnerable households.
Since energy represents both a critical input along different stages of the water and food supply chain and the largest source of GHG emissions, the energy transition should be considered the first step towards sustainable integrated solutions able to enhance security and sustainability across WEF sectors, while supporting global climate ambitions. The joint development of non-conventional water and energy sources, i.e., desalinated water and renewable energy, could address water and energy security challenges by combining economic efficiency and social equity under the constraint of environmental protection [Giordano and Quagliarotti 2020].
In the MENA countries, renewable energy may provide access to a cost-effective, secure and environmentally sustainable supply of energy, simultaneously triggering spill-over effects throughout the WEF nexus. The MENA region has a high potential in renewable energy development, especially solar, due to the presence of vast desert lands with a solar radiation density ranging between 1,300 and 2,500 kWh/m2 per year [IRENA 2015]. Generally, renewable energy technologies are less water-intensive than conventional options: water needs for solar photovoltaics (PV) is negligible compared to conventional thermoelectric generation, withdrawing up to 200 times less water to produce the same amount of electricity [IRENA 2016]. In addition to contributing to significant water savings, clean energy can be used to increase non-conventional water supply more sustainably, especially desalinated water, whose production is still affected by high economic and environmental costs due to the considerable amount of fossil energy required to feed the reverse osmosis. Therefore, the use of renewables may not only satisfy the energy demand of countries that do not have sufficient oil reserves, but also improve the resilience and adaptive capacity of those countries that, due to environmental constraints and the scarcity of two strategic resources for human well-being – water and food, are more vulnerable to the impact of climate change.
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Note
[13] GASC is an Egyptian economic body affiliated to the Ministry of Supply and Home Trade established by Republican Decree No 1189/1968 to overcome the crises arising in the Egyptian market during 1967 and in subsequent years. It aims to activate the local and international market mechanism in order to procure the strategic commodities needed by the state so as to achieve the following targets: improve productivity and raise agricultural production efficiency; develop marketing and promotional services; establish strategic governmental food stocks; achieve structural suitability within the state marketing system; create competitiveness, prohibit monopoly and make the local market balanced (http://www.gasc.gov.eg).
[14] Egypt has high rates of overweight and obesity, which are linked to food subsidies and associated consumption of energy-dense foods.