Effects of Ukraine War on European and World Economy

Effect on European Economy:

Twenty countries of Europe use Euro as their currency. In these counties, prices have increased by 6.1% in May, 2023. This was informed by European Union’s Statistics Agency. This is the lower percentage of price increases since February, 2022 when Russia invaded Ukraine.

Food prices raised second time in May, 2023. On the other hand, energy prices cut down. Inflation has dropped speedily in four countries comprising Germany, France, Italy and Spain.

According to up-to-date data issued by European Union in May 2023, Euro area joblessness chopped down from 6.6% to 6.5% before one month.

Effect on World Economy:

Before Russian assault on Ukraine, global economy was going up at the percentage of 5%. But Ukraine conflict brought a great energy shock to the marketplaces. After beginning of this conflict, world business growth cut down to only 3.1%. By the completion) of 2023, it is predicted to more come down to 2.2%. This conflict may cause a record grave economic disaster in Europe where economic growth may cut down to 0.3% by the finish of year 2023.

Losses in Ukraine:

According to the report of world bank, $349 billion dollars will be needed for reconstructing Ukraine. This money is even more then Ukraine’s per-attack GDP. Russia looks to be formulating) for a extensive conflict. Ukraine’s western partners have stopped $300 billion owned by the Russian central bank. Some people consider that some of this amount may be shifted to Ukraine. But results of conflict will tell whether Ukraine’s western partners would be able to shift this money to Ukraine or not.

Europe’s Reliance on Russian Energy has Ended:

For many years, Russia and much of Europe were bound together in an oil and gas relationship. Russia required) a trusted and firm energy marketplace for its gas and oil. On the other side, Europe required permanent energy supply which would decrease its dependence on Middle East. In 2022, European marketplace seemed as the main client for Russia. Before Ukraine conflict, 60% of Russian oil exports were for Europe. Also, 74% of its dry natural gas was kept for Europe. After Russian attack on Ukraine, Europe’s desire for Russian gas has decreased. This is another effect of Ukraine conflict.