World Bank Chief Urges Nations to Fill Russia-Ukraine Output Gap

© Reuters

(Bloomberg) —

Countries around the globe face a challenge in replacing supply of commodities from Russia and Ukraine that has been cut off by the war and should remove restraints to production, according to the World Bank chief.

Nations could look at easing constraints such as the Jones Act in the U.S. — which requires that ships moving between ports be built and registered in the nation and crewed by Americans — and the mandate that ethanol be mixed into gasoline, said David Malpass, president of the Washington-based development lender.

Advanced economies must avoid hoarding of supplies such as gasoline to make sure that the poorest nations aren’t affected, Malpass said. Focus should be placed on quickly ramping up output from alternative suppliers such as Indonesia for nickel and the U.S., Canada and Mexico for food and energy.

“This is a huge problem for developing countries in general, and especially the poorest ones,” Malpass said in a Bloomberg Television interview on Wednesday with Lisa Abramowicz, Jonathan Ferro and Tom Keene. “The Russia situation right now doesn’t look like it will be a temporary one. It’s a longer-lasting set of problems for the world in interacting with Russia on oil, on wheat, on basic minerals, and there need to be supplies elsewhere.”

Emergency financing of more than $700 million for Ukraine announced by the World Bank, Netherlands and partner countries this week will help with food and doctors as the development lender works on a larger aid program, Malpass said.

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