London: A combination of soaring food and fuel prices could generate a wave of political instability, as people who were already frustrated with government leaders are pushed over the edge by rising costs, media reports said.
“It is extremely worrisome,” said Rabah Arezki, a senior fellow at Harvard’s Kennedy School of Government and former chief economist at the African Development Bank, CN reported.
Unrest in Sri Lanka, Pakistan, and Peru over the past week highlights the risks. In Sri Lanka, protests have erupted over shortages of gas and other basic goods, the report said.
Double-digit inflation in Pakistan has eroded support for Prime Minister Imran Khan, forcing him from office.
At least six people have died in recent anti-government protests in Peru sparked by rising fuel prices. But political conflict isn’t expected to be limited to these countries, CNN reported.
“I don’t think people have felt the full impact of rising prices just yet,” said Hamish Kinnear, a Middle East and North Africa analyst at Verisk Maplecroft, a global risk consultancy.
In Sri Lanka, an island nation of 22 million, an economic and political crisis is already boiling over, with protesters taking to the streets in defiance of curfews and government ministers stepping down en masse.
Grappling with high debt levels and a weak economy reliant on tourism, Sri Lanka was forced to run down its reserves of foreign currency. That prevented the government from making payments for key imports such as energy, creating devastating shortages and forcing people to spend hours lining up for fuel, CNN reported.
While Imran Khan’s political problems date back years, claims of economic mismanagement as the cost of food and fuel leaped, as well as the depletion of foreign exchange reserves, made matters worse.
“The extent of economic chaos has united opposition to Imran Khan,” Kinnear of Verisk Maplecroft said, CNN reported.