UN official warns: rising energy prices and the El Niño phenomenon could push millions of people into poverty

Approximately 130 million people worldwide are at risk of falling into poverty this year amid rising energy and food prices, the El Niño phenomenon and increasing financing costs, warns Alexander De Croo, administrator of the United Nations Development Programme (UNDP).

Developing countries are the most vulnerable, particularly those in South and East Asia and sub-Saharan Africa. The global poverty index has risen for the first time in 16 years, and approximately 1.2 billion people are already affected.

Rising hydrocarbon prices, exacerbated by the conflict in the Middle East, have prompted governments to introduce extensive fuel subsidies. The measures temporarily protected the population but reduced fiscal space for healthcare, education and investment in renewable energy. Some states have begun reducing the assistance, risking social protests.

At the same time, El Niño may cause prolonged periods of drought between November and February, affecting harvests and fuelling inflation. Poor countries are also facing higher interest rates: interest payments consume, on average, 9.5% of their public revenues, more than three times the level in high-income countries.

UNDP is calling for international investment in resilience, jobs and renewable energy, as well as reforms enabling vulnerable countries to finance their development.