Cost of living crisis hits poorest the hardest, warns UNCTAD

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Food Security
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Billions of people are facing the greatest cost of living crisis in a generation due to rising food and energy prices amid rapid inflation and increasing debt, the UN trade and development body, UNCTAD has said.

UNCTAD’s analysis shows that a 10 percent increase in food prices will trigger a five percent decrease in the incomes of the poorest families, roughly equivalent to the amount those families would normally spend on healthcare.

As consumers try to reduce their spending, they will pay a high price if they buy cheaper, but unsafe products.

“Governments must strive to continue and succeed in their long-term mission of protecting their consumers, a mission of renewed relevance today,” said UNCTAD Secretary-General Rebeca Grynspan at the organization’s intergovernmental meeting on consumer protection held on 18 and 19 July.

While more developed countries have put in place product safety frameworks, including laws, enforcement institutions, recall mechanisms and communication campaigns, developing countries with weaker systems, UNCTAD said, are less able to regulate the scourge of unsafe products.

UNCTAD says consumers’ vulnerability is heightened since they may be unaware that health or safety requirements vary from country to country and may assume that all products on sale online are safe.

As consumers often underestimate risk and may decide to purchase the cheapest products out of financial necessity.R

According to UNCTAD’s World Consumer Protection Map, 60 percent of countries lack experience in cross-border enforcement when it comes to consumer protection.

“Most countries in Africa do not have the capacity or experience to deal with the distribution of unsafe products,” said Willard Mwemba, CEO of the COMESA Competition Commission, “but regional efforts can build those capacities and benefit all participating countries.”

High-level officials participating in the UNCTAD meeting agreed that preventing cross-border distribution of known unsafe consumer products is a priority for countries, as it can improve consumer confidence and boost sustainable economic development.

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