Pressure on dwindling resources ‘threatens global chaos’
Demand for basic commodities set to soar over the next 20 years
MONDAY 10 DECEMBER 2012
Pressure on the world’s resources is becoming so great the situation could trigger a proliferation of hunger and warfare hugely damaging to the global economy, according to an analysis published today.
With demand for basic commodities such as wheat and copper set to soar over the next 20 years, relatively small shocks to supply risk causing sudden price rises and triggering “overreactions or even militarised responses”, says a report by the Chatham House think tank. Global trade is so interconnected that no importer of resources is insulated from the problems of key exporters – a fact of concern to the UK, which imports 40 per cent of its food and a high proportion of the fossil fuels and metals it consumes, the think tank warns.
“Shocks reverberate across supply chains when communities protest in Peru, rainfall levels drop in the American Midwest, or a flood hits Australia – often sending the global resource markets into a tailspin,” according to the report, entitled Resources Futures. Chatham House is calling on the world’s 30 biggest producers and consumers of resources – including the UK, China and the US – to form a G8-style “coalition of the committed” to tackle the increasing volatility in global commodity prices.