OBELA Analysis

The food picture is complicated for much of the world, especially for vulnerable countries, by two particular factors: the fall in population income that the pandemic has produced and the confinement of the world's economies.
Food trade has become more complicated in terms of distribution networks, leading to higher food prices. This crisis has put the costs and benefits of food dependence on the free market into perspective.
How food is produced and distributed is in question since most countries have the capacity to produce food themselves and do not need to rely on long supply chains to feed their people.

The slowdown in economic activities impacted manufacturing production linked to the world market, and likewise food processing and distribution. The world is approaching a food consumption crisis. There are growing problems in the production and distribution of basic foods that are widespread.
The effect of the economic and production slowdown caused by COVID-19 has been a rise in food prices and in the prices of basic goods, which, however, is not reflected in consumer price indices, in general, due to the strong deflation of fuels and other raw materials.
With the economic rationale of free markets, free international food trade became more profitable and the notion of food security was abandoned. We now see the consequences on prices and the risks on the lack of supplies

Pressure to reactivate GVCs to reduce the economic impact of COVID-19 is increasing, but a second wave of contagion has been seen in countries trying to return to normal.

The dilemma in the very short term is: recover the economy at a cost in human lives or continue with the isolation and risk a greater economic fall.

This note reflects on the conditions in the labour sector in advanced and emerging economies in the face of the virus; the role of the State in the face of the pandemic; the economic incentive to reactivate the economy and global value chains; a panorama of what is expected from the world economy.