The UN has warned that rising tariffs due to the global economic downturn will increase global inflation and have a profound impact on the economies of developing countries.
Rising commodity prices are expected to raise consumer prices worldwide by 1.5 percent if they remain high next year, according to a United Nations Conference on Trade and Development estimates in a report on Thursday.
The number of factors that have contributed to the epidemic, along with the disruption of ports full of ports to the Suez Canal blockage, has led to the cost of freight prices, almost nearly fivefold in the last decade.
But developing countries that rely on other countries are expected to face higher shipping costs. Consumer prices are expected to rise by 2.2 percent in 46 less developed countries around the world and 7.5 percent in smaller islands such as Fiji, Mauritius and Jamaica, the report showed.
“The impact of prices on developing countries, especially small developing countries, is five times higher,” said Shamika Sirimanne, head of technology and operations at Unctad. “This is very difficult.”
As prices rise from everything from steel to strength, central banks are assessing whether inflation is likely to stabilize later.
UK inflation rose to 4.2 per cent in October, its highest level for nearly a decade, increasing pressure on the Bank of England to raise interest rates. In the US, consumer prices rose by 6.2 percent, their fastest increase since 1990, while the fall in eurozone prices has been stagnant for 13 years of 4.1 percent.
Jan Hoffmann, Unctad’s chief marketing officer, said shipping companies were reducing their contribution to raising prices. Managers often point out that it only takes a few cents to ship shoes from China or a bottle of wine from Australia to Europe or the US, meaning more jumps are less likely for consumers.
But Mr. Hoffmann said the volume of goods shipped by container makes the quantity of goods in line with the controversy over global inflation.
“If we look at inflation targets in Europe and the US, then 1.5 percent is important,” he said.
The effect of shipping costs on consumer prices varies greatly depending on the goods. Supported by complex global chains such as computers, as well as more expensive items including furniture and fabrics, are expected to cost at least 10 percent due to rising shipping costs, the report said.
Container prices have declined in recent weeks because of a long period of time, but still very high.
Sea-Intelligence, an offshore consultant, predicted this week that it could take up to 30 months for prices to return to normal due to the deep economic crisis.
Sirimanne warned that the re-integration of maritime goods, which has significant benefits, could make higher prices “sticky”.
He also urged governments to support the development of Covid-19 vaccines in developing countries to help reduce inflation and inflation.
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