12 Aug Hunger is an Issue for the Global Economy

By David Harary, Founder of the Center for Development and Strategy

The argument to rid the world of hunger and food insecurity has been developed from the side of compassion over the last few decades. As Gandhi said, “to a hungry man, a piece of bread is the face of God.” And while it has largely been assumed that hunger, malnutrition, and obesity have been problems that can be dealt with only through nonprofit organizations and charity, the idea to connect for-profit industry and business investment to these issues, is a relatively new concept.

Josette Sheeran, former Executive Director of the United Nations World Food Programme (WFP), highlights in her TedTalk, “Ending Hunger Now”, how malnutrition hits economies home on the most basic level: the human brain. Research has shown that brain volumes in those who don’t receive proper nutrition can be up to 40 times less than those who do. The implications of decreased brain development includes causing an array of motor and cognitive impairments that ultimately leads to lowered economic productivity.

Economic Costs

The United Nation’s Food and Agriculture Organization (FAO) has estimated that the net sum of social costs for malnutrition is over $3.5 trillion. In addition, the FAO has estimated the cost of under-nutrition to be between $1.4 and $2.1 trillion. This represents a combined 7-8% of global GDP. Meanwhile, the United Nations has also estimated the cost to eradicate global hunger to be about $30 billion.

This simple cost-benefit analysis highlights the opportunity that developing countries have to be highly productive. If the private sector, throughout the global economy, can harness this potential human capital by investing in technologies that produce food at greater yields, the entire world economy can grow significantly.