Global macro-economic crisis in commerce: The Ukraine-Russia conflict
Global macro-economic crisis in commerce
Experts believe that despite the ongoing war between Ukraine and Russia. The world economy will grow this year, but the effects of this war will be felt around the world. The intensity of the impact of this war will depend on the duration of the war. The global macro-economic crisis in commerce has been hit negatively by the Ukraine-Russia conflict. This period will determine whether the recent economic and financial instability in world markets is a temporary or permanent setback. In this article, we try to understand how this war affects startups and whether it could lead to the global financial crisis. Poland, which borders Ukraine, was also one of the countries most affected by the war.
The UK-based consulting firm Oxford Economics said the economic consequences of the war would be “serious”. It will severely affect Ukraine, the US, the UK, China, and Russia, but different for all of the people and societies on the globe.
For example, Turkey and Poland have important trade ties with Russia. The effects of the war will be more painful for these countries than for other economies. Poland imports 50 percent of its oil from Russia. While one-third of Turkey’s oil supplies come from Russia. But US trade with Russia is only 0.5 percent of their GDP, compared to 2.5 percent with China. So the impact of the war on these countries will be very limited. The war between Ukraine and Russia has halted global growth this year from 4% by 0.2% to 3.8%.
The Ukraine-Russia conflict and its repercussions
Another important factor to keep in mind is the impact on oil prices. It has shaken the world market. According to the US official, that the Russia is the world’s third-largest oil producer after the United States and Saudi Arabia. It produced 10.5 million barrels of oil per day in 2020 and sold 5 to 6 million barrels of oil per day, more than half of which was imported to Europe. It rose 18% to 140,140 barrels after rising 21% last week.
Rising oil prices not only push up fuel prices but affect everything. The rise in inflation is due to the high costs of manufacturing and transporting fuel and energy products. The combination of higher oil prices and inflation could lead to a crisis of “job loss, recession, and oversupply,” Barclays economists said. They have already cut their forecasts for global economic growth by 1% because of the war between Ukraine and Russia.
Economists refer to this possible crisis as “stagnation,” meaning it occurs at a time when inflation and economic stagnation in the country are steadily rising.
More than half of the world’s population relies on fertilizers alone, and not using them in the fields could reduce yields of some crops by as much as 50 percent, he said.
Ukraine and Russia Logistical challenges
The current conflict between Russia & Ukraine has affected freight movements in the disputed area. Domestic, sea, and air routes are becoming increasingly dangerous in the area, forcing many logistics companies to block the movement of goods through the Black Sea. Combined with the global shortage of containers and rising oil prices, risky directions could lead to higher insurance premiums, which would translate into a significant increase in logistics costs. This could hurt the US tech company’s manufacturing and assembly costs.
Russian and Ukrainian ships also represent 15% of the global maritime community. Cargo ships and crews, as well as those involved in transporting deadly components and products to Europe and the United States. They could benefit from their absence.
Global Macro-economic Environment
Shon-Roy says the business logistic management crisis affecting the semiconductor industry in 2021 will become even tenser in 2022 thanks to this conflict. For example, the supply of helium, which is widely used in the semiconductor industry. the shortages has recently been hit hard by difficulties at two gas jet suppliers. America’s BLM and Russia’s Gazprom. The opening of new semiconductor manufacturing facilities in the US could also tighten supply chain constraints. Other key gases such as debrine, tungsten hexafluoride, nitrogen trifluoride and CF gases.
Despite Russia’s ability to block shipments of sapphire reserves and vital gases needed by the semiconductor industry. The SIA tried in February to calm the industry’s nerves over the impact of sanctions on Russia. try to. It is explained that it will comply with new export control laws announced in response to recent events in Ukraine. The SIA said the sanctions would have a significant impact on Russia, but also on the global semiconductor industry as a whole.