The Covid-19 pandemic slowed down the world economy by messing up supply chains, but the real kicker to the world was Russia’s invasion of Ukraine, and the West’s response to it. Decisions by the West early in the invasion clearly helped Russia and decimated Ukraine, but no country and people will get off Scot-free. As oil and gas, and wheat prices skyrocket, coupled with supply chain problems with China, the world will soon welcome a global recession.
Covid-19 Starts up Inflation
While it is true that CoVid-19’s worldwide onslaught was front and center for the past two years, its repercussions have largely been contained. Countries have gotten around to adapting, and with the exception of China and North Korea, opening up. China’s “Zero Covid” government policy has slowed down and sometimes even stopped supply chains and factories in China. Shanghai is just now seeing glimmers of hope that their lockdown might be ending.
Russia Invades Ukraine
The big kick to the world economy was Russia’s invasion of Ukraine. Russia exports a significant amount of oil and gas, while Ukraine exports wheat, sunflower oil, components that are used to make stainless steel, and much more. The West quickly condemned Russia and boycotted Russian goods and some oil and gas. Other countries such as China and India did not.
A boycott of Russian oil and gas started a cascade of higher gas and oil prices, especially in the EU, where large countries such as Germany and France rely on Russian oil and gas. Outraged they were, but with few alternative sources of oil, there was nothing they could quickly implement alternative solutions. The Russian oil and gas sanctions increased a worldwide inflation trend, one that was started by supply chain problems in China.
The West Does not directly Confront Russia’s Invasion
A decision was made by Western countries to not directly fight alongside Ukraine to defend their sovereignty. Instead the West would support Ukraine indirectly by supplying arms, and allow the Ukrainians to defend themselves. In other words, the West had taken a “hands off” approach. Russia had threatened the world with nuclear war, and the West was scared.
As in other wars where Russia has participated, Russia began bombing the crap out of Ukraine. In essence, the Ukrainian economy could not function. Ukraine infrastructure was being destroyed, crippling its ability to manufacture, farm and then transport its goods to its ports for export.
No Worldwide winners but all Losers
We now have Russia, the aggressor, under Western sanctions, and Ukraine, who’s infrastructure has been bombed out. Without Russian and Ukrainian oil and gas, gas prices shoot up, sending an inflationary shock wave through the world. Everything that needs transporting is now much more expensive. This is on top of he supply chain slowdowns from China’s “Zero Covid’ policy. Ukraine supplies wheat to poorer Middle Eastern countries such as Egypt, and others such as India. With a lack of regular wheat supply, wheat prices skyrocket, and there are severe shortages in many countries. These shocks give worldwide inflation sturdy legs to stand on.
Ukraine also manufactures, which they export to the rest of the world. With Ukraine no longer able to export fertilizer, fertilizer prices worldwide have spiked, This has affected agriculture throughout the world, including India and here in Canada. The world depends on fertilizer to boost crop yields. Without fertilizer there will be a shortage of food.
Ukraine has always wanted to join the EU. Now that Ukraine has been bombed out, and its buildings, both civilian and business, have been destroyed, the EU claims that it will take Ukraine 20-30 years to rebuild, so entry into the Eu will take that long.
There are no winners in this Russian invasion of Ukraine. Russia is now a pariah state under severe economic sanctions, Ukraine has a war on its lands, and infrastructure has been severely damaged. The West now has sky high oil and gas prices, which coupled with supply chain issues, has spiked inflation. Western central banks have needed to markedly increase interest rates, which hurts Western consumers. India is paying much more for oil and gas, as well as imported wheat. Middle Eastern countries are struggling to supply its people with adequate wheat for making staples such as bread, and wheat prices have skyrocketed. There are no winners here. The world increasingly looks like it will go into recession.
If only the West Had Intervened in Russia’s Invasion
An alternative reality might have had the West directly intervene with Ukraine to stop Russia’s needless attack from the start. There was no courage for this at the time and even today. If the invasion was stopped early, damage would have possibly been minimized. Ukraine may have been able to keep most of its infrastructure, and continue to supply the world with its oil and gas, as well as wheat. While the world would still have had a blip from the sanctioning of Russian oil, the damage would have been far less. Alas, courage worldwide was unavailable. The world did not provide enough direct help to Ukraine, and thus we might see a worldwide recession.
What has been damaged cannot be undone. Russia’s bombing and decimation of Ukraine continues. The West continues to sit on its hands. People will look back on this part of history and see the cowardice of the West, and in particular of Europe.
I had thought that the world would have acted to protect everyone somewhat equally, but I was completely wrong. Selfish motivations have left Ukraine severely damaged. Payback for the cowardly Western countries is coming in the form of a recession. What is the point of documenting Russian war crimes while these war crimes are going on? Would it not be much better to stop these war crimes from happening, as the West could have? As a race mankind still has not progressed sufficiently. At least this lesson is clear to everyone now.
