The whole has taken sides for the upcoming war between Russia and Ukraine, dubbed as “The biggest war in Europe since 1945”. The world countries have taken sides while some countries like Sweden, Austria, Switzerland, Turkey and India are opting for diplomatic dialogue for a peaceful solution to the issue.
Ukraine is Europe’s second-largest country by area, behind Russia, with which it shares borders to the east and north. Ukraine is bordered on the north by Belarus, on the west by Poland, Slovakia, and Hungary, on the south by Romania and Moldova.
Russia’s Side: China, Iran, Cuba and the five countries separated from the Soviet Union – Armenia, Kazakhstan, Kyrgyzstan, Tajikistan and Belarus.
Ukraine’s side: UK, USA, Japan, Canada, Australia, France, Germany, Finland, NATO countries including 30 and 10 of these are near Russia. These countries have frozen the bank accounts of Russian President Vladimir Putin and other Russian Individuals.
The War and its effects on the world:
The proclamation of the independence of Ukraine’s Donetsk and Luhansk regions by Russian President Vladimir Putin is “The start of a Russian invasion of Ukraine.” The mounting prospect of conflict has obvious political consequences in Europe and around the world, with inflation, rising oil prices, a constricted supply chain, and the ongoing epidemic putting strain on the global economy.
- Oil Prices: Gas prices are expected to rise since Russia supplies around 40% of the gas used in the European Union. Oil prices have already risen to near $100 per barrel due to the threat of war; if Russia goes ahead with its plans to invade Ukraine, the price may reach $150 per barrel.
- Economic turmoil: Russian Cyberattacks on Ukraine have already harmed the country’s banking and military. Other countries, such as the United States, are also vulnerable, and the Treasury Department and the Department of Homeland Security have issued warnings about potential assaults on banks, hospitals, government offices, and power grids in the United States.
- Shortage of Important Metals: Palladium is a metal used in automotive exhaust systems, fuel cells, mobile phones, and even jewellery and dentistry, and Russia is the world’s leading exporter. Palladium and other critical metals, such as aluminium and nickel, are experiencing rising costs, which might cause another supply chain disruption. On the other hand, Ukraine is also a large producer of uranium, titanium, iron ore, steel, and ammonia, as well as a key supplier of agricultural land in Europe.
- Stock Exchange Crashing: The Russia-Ukraine scenario is unstable, with high tensions, and this will continue to be a challenge for stock market volatility in the immediate term. Today’s markets are realising that this is the greatest threat to European security since World War II.
- Food Prices: Since Ukraine is renowned as Europe’s breadbasket and one of the world’s top five corn exporters, food costs are rising. Additionally, associated products like cooking oil, corn syrup, and livestock feed would be impacted. Russia, on the other hand, is the world’s leading exporter of wheat, and Ukraine also exports wheat. The two countries together account for nearly a third of global wheat trade (29 per cent). This will have a significant impact on the world’s countries.
- Travel Ban: Travel restrictions have been imposed on both Ukraine and Russia by countries all around the world. In contrast, India recommended its people, particularly students, to leave Ukraine temporarily due to “uncertainties” and to avoid non-essential travel to and within the country.
- Euro Down, Dollar Up: If a conflict creates global uncertainty and encourages investors to rush money into the dollar, driving up the currency’s value, imports from the United States could become cheaper.
- Air Products: Flight disruptions from Asia to Europe might have an impact on companies that transport goods by air, such as electronics, quick fashion, and even automakers.
These concerns would only exacerbate public conflicts and social unrest across the country and the world.
