ALBAWABA – The current agrifood system adds trillions in hidden costs to the global economy every year due to unhealthy diets, farm emissions and undernourishment, the United Nations (UN) Food and Agriculture Organization (FAO) said on Monday.
The UN agency, FAO, conducted an analysis across 154 countries to determine the “true” cost of the agriculture and food (agrifood) system and found it added $12.7 trillion in hidden costs in 2020.
According to Agence France-Presse (AFP), that is around 10 percent of the global gross domestic product (GDP), including direct and indirect hidden costs.
The study found that 73 percent of the hidden costs are linked to bad diets that are high in ultra-processed foods, fats and sugars, causing obesity and other diseases such as diabetes. This in turn incurs additional healthcare costs that are directly and indirectly related to the current unhealthy agrifood system.
"The future of our agrifood systems and, indeed, of our planet hinges on our willingness to acknowledge these true costs and understand how we all contribute to them," said FAO Director-General Qu Dongyu.
The unhealthy agrifood system adds somewhere between $10 trillion and $16 trillion in hidden costs to global economy - FAO
Other costs include labor productivity losses, especially in upper and middle-income countries, according to Bloomberg, as a result of these non-communicable diseases.
These hidden costs identified by the FAO point to a disproportionate impact on poorer nations, where losses are mainly related to poverty and malnutrition, Bloomberg reported.
Low-income countries are the worst hit by these hidden costs, which account for 27 percent of their GDP, according to AFP. This is compared to 11 percent for middle-income nations and less than eight percent in wealthy ones.
On average, these costs range from $10 trillion to $16 trillion a year, with $12.7 trillion being the probable outcome, according to the FAO. About a fifth of those expenses relate to the environment, including greenhouse gas and nitrogen emissions, land-use change and water use.
