Alberta
Russia has halted a wartime deal allowing Ukraine to ship grain. It’s a blow to global food security
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LONDON (AP) — Russia halted a breakthrough wartime deal on Monday that allows grain to flow from Ukraine to countries in Africa, the Middle East and Asia where hunger is a growing threat and high food prices have pushed more people into poverty.
Kremlin spokesman Dmitry Peskov said Russia would suspend the Black Sea Grain Initiative until its demands to get its own food and fertilizer to the world are met. While Russia has complained that restrictions on shipping and insurance have hampered its agricultural exports, it has shipped record amounts of wheat.
“When the part of the Black Sea deal related to Russia is implemented, Russia will immediately return to the implementation of the deal,” Peskov said.
The suspension marks the end of an accord that the U.N. and Turkey brokered last summer to allow food to leave the Black Sea region after Russia’s invasion of its neighbor worsened a global food crisis. The initiative is credited with helping lower soaring prices of wheat, vegetable oil and other food commodities.
Ukraine and Russia are both major global suppliers of wheat, barley, sunflower oil and other affordable food products that developing nations rely on.
The grain deal provided assurances that ships won’t be attacked entering and leaving Ukrainian ports, while a separate agreement facilitated the movement of Russian food and fertilizer. While Western sanctions do not apply to Moscow’s agricultural shipments, some companies may be wary of doing business with Russia because of the measures.
Ukrainian President Volodymyr Zelenskyy’s adviser, Mykhailo Podolyak, said the suspension was expected and believes it’s political theater.
“The statement itself immediately includes an escape clause,” he said. “Therefore, we are dealing with classic public techniques of the Russian Federation that no longer require significant reciprocal reactions.”
Turkish President Recep Tayyip Erdogan said the country’s foreign minister would speak with his Russian counterpart Monday — and that he was hopeful the deal would be extended.
The suspension of the deal sent wheat prices up about 3% in Chicago trading, to $6.81 a bushel. Analysts don’t expect more than a temporary bump to food commodity prices because places like Russia and Brazil have ratcheted up wheat and corn exports, but food insecurity worldwide is growing.
The Black Sea Grain Initiative has allowed three Ukrainian ports to export 32.9 million metric tons of grain and other food to the world, more than half of that to developing nations, according to the Joint Coordination Center in Istanbul.
The agreement was renewed for 60 days in May, but in recent months, the amount of food shipped and number of vessels departing Ukraine have plunged, with Russia accused of preventing additional ships from participating.
The war in Ukraine sent food commodity prices to record highs last year and contributed to a global food crisis also tied to other conflicts, the lingering effects of the COVID-19 pandemic, droughts and other climate factors.
High costs for grain needed for food staples in places like Egypt, Lebanon and Nigeria exacerbated economic challenges and helped push millions more people into poverty or food insecurity.
Rising food prices affect people in developing countries disproportionately, because they spend more of their money on meals. Poorer nations that depend on imported food priced in dollars also are spending more as their currencies weaken and they are forced to import more because of climate change. Places like Somalia, Kenya, Morocco and Tunisia are struggling with drought.
Under the deal, prices for global food commodities like wheat and vegetable oil have fallen, but food was already expensive before the war in Ukraine and the relief hasn’t trickled down to kitchen tables.
“The Black Sea deal is absolutely critical for the food security of a number of countries,” and its loss will compound the problems for those facing high debt levels and climate fallout, said Simon Evenett, professor of international trade and economic development at the University of St. Gallen in Switzerland.
The U.N. Food and Agriculture Organization said this month that 45 countries need outside food assistance, with high local food prices “a driver of worrying levels of hunger” in those places.
The grain deal has faced setbacks since it was brokered by the U.N. and Turkey: Russia pulled out briefly in November before rejoining and extending the deal.
In March and May, Russia would only extend the deal for 60 days, instead of the usual 120. The amount of grain shipped per month fell from a peak of 4.2 million metric tons in October to 1.3 million metric tons in May, the lowest volume since the deal began.
Exports expanded in June to a bit over 2 million metric tons, thanks to larger ships able to carry more cargo.
Ukraine has accused Russia of preventing new ships from joining the work since the end of June. Joint inspections meant to ensure vessels only carry grain and not weapons that could help either side also have slowed considerably.
Asked Monday whether an attack on a bridge connecting the Crimean Peninsula to Russia was a factor in the decision on the grain deal, the Kremlin spokesman said it was not.
Meanwhile, Russia’s wheat shipments hit all-time highs following a large harvest. It exported 45.5 million metric tons in the 2022-2023 trade year, with another record of 47.5 million metric tons expected in 2023-2024, according to U.S. Department of Agriculture estimates.
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AP reporters Hanna Arhirova in Kyiv, Ukraine, and Andrew Wilks in Istanbul contributed.
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See AP’s complete coverage of the war in Ukraine at https://apnews.com/hub/russia-ukraine and the food crisis at https://apnews.com/hub/food-crisis.
Courtney Bonnell, The Associated Press
Alberta
Open letter to Ottawa from Alberta strongly urging National Economic Corridor
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Canada’s wealth is based on its success as a trading nation. Canada is blessed with immense resources spread across a vast country. It has succeeded as a small, open economy with an enviable standard of living that has been able to provide what the world needs.
Canada has been stuck in a situation where it cannot complete nation‑building projects like the Canadian Pacific Railway that was completed in 1885, or the Trans Canada Highway that was completed in the 1960s. With the uncertainty of U.S. tariffs looming over our country and province, Canada needs to take bold action to revitalize the productivity and competitiveness of its economy – going east to west and not always relying on north-south trade. There’s no better time than right now to politically de-risk these projects.
A lack of leadership from the federal government has led to the following:
- Inadequate federal funding for trade infrastructure.
- A lack of investment is stifling the infrastructure capacity we need to diversify our exports. This is despite federally commissioned reports like the 2022 report by the National Supply Chain Task Force indicating the investment need will be trillions over the next 50 years.
- Federal red tape, like the Impact Assessment Act.
- Burdensome regulation has added major costs and significant delays to projects, like the Roberts Bank Terminal 2 project, a proposed container facility at Vancouver, which spent more than a decade under federal review.
- Opaque funding programs, like the National Trade Corridors Fund (NTCF).
- Which offers a pattern of unclear criteria for decisions and lack of response. This program has not funded any provincial highway projects in Alberta, despite the many applications put forward by the Government of Alberta. In fact, we’ve gone nearly 3 years without decisions on some project applications.
- Ineffective policies that limit economic activity.
- Measures that pit environmental and economic objectives in stark opposition to one another instead of seeking innovative win-win solutions hinder Canada’s overall productivity and investment climate. One example is the moratorium on shipping crude through northern B.C. waters, which effectively ended Enbridge’s Northern Gateway proposal and has limited Alberta’s ability to ship its oil to Asian markets.
In a federal leadership vacuum, Alberta has worked to advance economic corridors across Canada. In April 2023, Alberta, Saskatchewan and Manitoba signed an agreement to collaborate on joint infrastructure networks meant to boost trade and economic growth across the Prairies. Alberta also signed a similar economic corridor agreement with the Northwest Territories in July 2024. Additionally, Alberta would like to see an agreement among all 7 western provinces and territories, and eventually the entire country, to collaborate on economic corridors.
Through our collaboration with neighbouring jurisdictions, we will spur the development of economic corridors by reducing regulatory delays and attracting investment. We recognize the importance of working with Indigenous communities on the development of major infrastructure projects, which will be key to our success in these endeavours.
However, provinces and territories cannot do this alone. The federal government must play its part to advance our country’s economic corridors that we need from coast to coast to coast to support our economic future. It is time for immediate action.
Alberta recommends the federal government take the following steps to strengthen Canada’s economic corridors and supply chains by:
- Creating an Economic Corridor Agency to identify and maintain economic corridors across provincial boundaries, with meaningful consultation with both Indigenous groups and industry.
- Increasing federal funding for trade-enabling infrastructure, such as roads, rail, ports, in-land ports, airports and more.
- Streamlining regulations regarding trade-related infrastructure and interprovincial trade, especially within economic corridors. This would include repealing or amending the Impact Assessment Act and other legislation to remove the uncertainty and ensure regulatory provisions are proportionate to the specific risk of the project.
- Adjusting the policy levers that that support productivity and competitiveness. This would include revisiting how the federal government supports airports, especially in the less-populated regions of Canada.
To move forward expeditiously on the items above, I propose the establishment of a federal/provincial/territorial working group. This working group would be tasked with creating a common position on addressing the economic threats facing Canada, and the need for mitigating trade and trade-enabling infrastructure. The group should identify appropriate governance to ensure these items are presented in a timely fashion by relative priority and urgency.
Alberta will continue to be proactive and tackle trade issues within its own jurisdiction. From collaborative memorandums of understanding with the Prairies and the North, to reducing interprovincial trade barriers, to fostering innovative partnerships with Indigenous groups, Alberta is working within its jurisdiction, much like its provincial and territorial colleagues.
We ask the federal government to join us in a new approach to infrastructure development that ensures Canada is productive and competitive for generations to come and generates the wealth that ensures our quality of life is second to none.
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Devin Dreeshen
Devin Dreeshen was sworn in as Minister of Transportation and Economic Corridors on October 24, 2022.
Alberta
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