The availability of affordable food may become a short-term casualty of the war in Ukraine.

There will also be a general surge in prices, arising from the war and from COVID-19-related supply chain issues, which are out of the control of western governments.

The immediate effect will be like the oil shock of 1973.

But chronic inflation of the kind that followed 1973 is, however, an avoidable risk.

The discontent in the Middle East will create new opportunities for organisations like ISIS

The direct dependence of countries like Egypt, Turkey and Tunisia on wheat from Russia and Ukraine will drive up food prices in those countries.

The populations there will vent their anger on their own governments, even though the real blame should go to Moscow.

The discontent in the Middle East will create new opportunities for organisations like ISIS.

As wheat is a global-traded commodity, wheat prices generally will go up. There may even be pressures in some countries to restrict wheat exports.

As supplies and affordability of these are constrained by war and sanctions, food production in Europe will gradually decline

The European Union is substantially self-sufficient in most agricultural commodities, such as wheat, barley, meat and dairy.

So, while prices are already rising, food scarcity in Europe will not be an immediate problem in 2022, or while existing stocks last.

But EU countries are not self-sufficient in fertilisers, energy and other key inputs to modern farming. As supplies and affordability of these are constrained by war and sanctions, food production in Europe will gradually decline.

Agricultural practices

Changes in agricultural practices that were already necessary to meet the longer-term climate challenge will have to be radically accelerated to counter this.

Precision farming, improved plant breeding and other techniques that reduce inputs will need to be ramped up.

The EU may have to take another look at its policy on genetic modification, if it enables more food to be produced without more expensive inputs.

The shock caused by the war in Ukraine means that we are heading into a period of rapid inflation

A concentrated research effort, similar to that undertaken to find vaccines for COVID-19, will be needed to make Europe’s food economy fully self-sufficient. The EU should take a lead in this.

The shock caused by the war in Ukraine means that we are heading into a period of rapid inflation. This is unavoidable in the short term. Real incomes will be cut because wages will buy less. The size of the national economic cake will be less.

The question will be whether we can hold the increases to those directly attributable to the war and to COVID-19, or whether the initial inflationary shock triggers a self-perpetuating process of second-, third- and fourth-round increases.

These second-round effects occur when organised interests are able to fully compensate themselves for the loss they have suffered because of the price shock, by increasing the prices they charge for the goods and services they provide to others. That can set off a self-perpetuating cycle.

Bargaining position

If those who are in a powerful economic bargaining position manage to compensate themselves fully for the increase in prices, the burden of the price increase will not disappear.

The challenge for governments will be to ensure that it does not happen

It will simply be placed on the shoulders of other less powerful economic interests, or on the shoulders of future generations through increases in the national debt.

If that happens, inflation becomes chronic. The challenge for governments will be to ensure that it does not happen.

What can the Government do?

The Government’s goal must be to ensure that the inflation shock is limited in time, and is seen to be distributed in a fair and realistic way.

But this will be very difficult. The inflation resulting from the war in Ukraine will reduce real purchasing power of national income.

Getting agreement on how to divide a national cake which has recently been reduced in size is much harder than it is to agree how to divide a cake that is getting bigger all the time.

There is more competition now than then and there are fewer monopolies

I know how difficult it will be, because I was a junior minister in an Irish Government in the 1970s, and, for a time, I had responsibility for prices and price control. It was a tense time.

Many things are different now to the 1970s and 1980s. There is more competition now than then and there are fewer monopolies. That reduces the possibility of second-round inflation effects.

We are entering a period when clear-sighted thinking by Government, backed by good and consistent messaging to the public, will be vital.

Solidarity between people, successfully applied in the recent epidemic, will have to be put to work in the management of the national economies of all EU countries, including Ireland, if we are to avoid inflation becoming chronic.