Due to the conflict between Russia and Ukraine, the global economy is facing significant difficulties.
Impact on global economy
The armed confrontation between Russia and Ukraine. two nations that are crucial in the chain of supply of international products. presents the world economy with yet another significant problem in the context.. of the post-pandemic recovery, which is both boosted and uncertain.
Several international financial analyses concur that a global recession is unlikely to result from Russia’s. special military operation in Ukraine and Western sanctions against Moscow. Because, according to him, the combined size of the two economies accounts for just. 2% of global GDP (GDP). The Russia-Ukraine issue has had a significant impact on the current health. of the global economy, but because both countries play a significant role in the worldwide. supply chain of products. particularly in the energy and food sectors, it has also caused significant disruptions.
According to experts and international financial institutions. The real impact that Western sanctions have had on Russia in all fields. from the production and supply of goods to finance, has demonstrated the role of this economy in the value chain of demand global. Specifically, Russia is the economy that provides one sixth of the world’s basic products. It produces 10% of the world’s crude oil and supplies Europe with 40% of its gas. Moscow is also a leading exporter of fertilizers, a producer of nickel and palladium. as well as being third in the world for steel and coal and fifth for wood. As a result, in its latest assessment, the European Commission. (EC) declared that Russia’s military operation in Ukraine makes the 4% growth forecast for this continent uncertain.
For his part, the chief economist of the European Central Bank (ECB), Philip Lane, said that the Russian.-Ukrainian conflict could reduce the GDP of the Eurozone by about 0.3 or 0.4 percentage points in 2022. On the other side of the Atlantic, the prices of wheat traded in the Chicago market (United States.) registered an increase of almost 3% on March 2, the highest since 2008. while the prices of corn also climbed to their highest level since May of 2021.
Particularly in the energy sector, the clashes in Ukraine have pushed crude oil prices on the world market to nearly $140 a barrel. (as of March 7), the highest in a decade. As a consequence, the rise in fuel prices has caused most other basic products to rise simultaneously. and has also increased inflation in many regions of the world.
Stop fighting to restore the economy
It can be stated that the Russia.-Ukraine crisis and related problems are negatively affecting the global. economy and hardly any economy can avoid its consequences. International economists share the view that it is too early to make detailed and specific forecasts. about the damage that the world economy will suffer from this conflict. However, it is true that the longer the crisis lasts, the deeper and more unpredictable its consequences and impacts will become. Of these, the most difficult problem lies in the supply of essential goods, such as energy and food.
Some analysts say the fallout from the crisis between Russia and Ukraine. threatens to stifle the gains the economies have made in recent times. They are even concerned about the risk of a food crisis and a subsequent humanitarian. crisis in some areas of the world, if these clashes continue to escalate and drag on.
International public opinion expects the warring parties to be aware of the seriousness of the problem. and to act actively in the interest of their own economy and their people. as well as for the stability of the region and the entire world.