Egypt rushed Tuesday to grant bonuses to workers after two days of deadly riots over high food prices and low wages wracked this northern industrial city, fueling government fears that economic angst might boil over across the country.

A top United Nations official warned that many poor nations are in danger of such unrest as inflation heats up around the globe.

Rising prices have struck hard in Egypt, a U.S. ally where 40 percent of the people live in or near poverty. This Nile Delta factory city has seen a wave of strikes for more than a year, and the anger exploded into rioting Sunday and Monday.

Protesters tore down a billboard of President Hosni Mubarak and fought with police in clashes that left one person dead in the worst unrest since Egypt's 1977 riots over increased bread prices.

Prime Minister Ahmed Nazif hurried to Mahalla al-Kobra on Tuesday with several top economic ministers to meet with workers at the 50-year-old, state-owned Misr Spinning and Weaving factory complex that employs 25,000 people.

"We know Mahalla is suffering and you have passed through many crises," Nazif told them. "But it is through crises that men prove their mettle."

He announced they would receive a bonus of 30 days' pay and promised to address their demands for better health care and higher wages.

Workers in the hall cheered. But afterward, many were skeptical.

"What Nazif has said, we've heard it all before - what's new? They really have no idea how we suffer here," said Rashad Fathi, a factory worker who said his monthly wage of $34 was not enough to feed his four children.

The chief of U.N. humanitarian operations, John Holmes, said Tuesday that poor people around the world are facing worsening hardship because of the expense of food. He said food prices had risen an average of 40 percent over the last year.

"The security implications should also not be underestimated as food riots are already being reported across the globe," Holmes said during a conference in Dubai. "Compounding the challenges of climate change in what some have labeled the perfect storm are the recent dramatic trends in soaring food and fuel prices."

Egypt's economic woes overshadowed Tuesday's municipal elections, in which voter turnout was meager. At polling stations in Cairo, only a few people were seen drifting in to cast ballots over several hours.

"Bread is getting more expensive. People are worried about that and most don't care about politics," said Medhat Abdel Nasser, a 20-year-old student who walked by a polling station in Cairo without a pause.

The government's soft approach to workers contrasted with its treatment of its top political competitor, the Muslim Brotherhood, which shocked authorities in 2005 with a strong showing in parliament elections. Hundreds of Brotherhood members were arrested in recent months, and nearly 10,000 of its candidates were not allowed to run.

But dealing with widespread anger among Egypt's 76 million people is a much more daunting prospect, and authorities moved quickly in hopes of calming tempers in Mahalla.

"I think they realized what happens if there are street battles for a protracted period of time and this way is cheaper and better," Joel Beinin, an expert on labor politics at the American University in Cairo, said about the worker bonuses.

"What if it lasted for a week? What if people did the same in Alexandria?" Beinin added, referring to the country's second largest city.

With prices for many staples in Egypt doubling over the past year, the government already was trying to deal with complaints over shortages of the subsidized bread on which the poor rely. Fights over subsidized bread have killed several people in recent weeks.

Unrest over food prices is not unique to Egypt. On Monday and Tuesday, protesters angered by high food prices flooded the streets of Haiti's capital, forcing businesses and schools to close as unrest spread from the countryside.

Even after Nazif's visit, Mahallah remained tense amid fears of more unrest and the municipal elections were canceled. Fifteen of the 56 local council seats were given to various small opposition parties, while the ruling National Democratic Party took the rest.

"The election committee said they just didn't want any more problems in the city," said Zakariya Mahalawi of the Democratic Front, a small liberal opposition party.

Hospital authorities also held on to the body of a teenager killed in the rioting, a move widely interpreted as an attempt to avoid a potentially explosive funeral.

"I understand why people are so angry. These are just our kids and our sons, and they are rioting because they are depressed and frustrated," worker Mervat Ahmed said after the prime minister's speech.

A 28-year-veteran of the textile factory, Ahmed said she makes about $91 a month. "What can I do with my salary? I have three kids, and every day prices go higher and higher."

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Associated Press writers Lauren Frayer and Paul Schemm contributed to this report.