El Niño threatens Asian crops and global economy

When a yellow-gray haze settled over Singapore a week ago and even the gigantic Marina Bay Sands Hotel could no longer be seen from the distance, the symbolic value of the unusual spectacle became apparent: that something was brewing in Asia's economy, the fastest-growing region in the world.

“El Niño” is the name of the climate phenomenon that causes the water in the Pacific to rise by a few degrees every few years and causes the weather to go crazy. Heavy rain in Peru, causing flooding on the dry coast. Extreme drought in the Indonesian rainforest, where the fires used by the palm oil industry to create space for plantations are spiraling out of control. The south wind blows the smoke towards Singapore.

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An El Niño in itself is not new, but its strength this year is. There are many indications that the phenomenon will warm the ocean more than ever before in late autumn. In Asia in particular, this leads to droughts and crop failures and less energy from hydropower. And because this is happening at a time when people and companies are already suffering from the consequences of the Iran war and the lack of oil and gas, the Asian Development Bank (ADB) no longer sees El Niño as a pure climate problem, but as a risk to economic and political stability.

The drought is affecting fewer technology locations such as Singapore or Malaysia, which have built up semiconductor production in recent years and are now benefiting from the boom in artificial intelligence. Farmers in the Philippines, Cambodia and Myanmar, whose growth forecasts the ADB has revised downwards in the face of a possible Super El Niño, will suffer.

It sounds as if the problem is far away from Germany. However, the German economy has declared the southeast and south of Asia to be its new growth area. But when food prices rise after poor harvests in the billion-nation India and in Indonesia with its 280 million inhabitants, then there is no money to buy German products. El Niño is threatening the global economy with the next shock.