Wednesday, 19 June, 2024

Global Impact Of Ukraine War

Global Impact Of Ukraine War

Shyam Prasad Mainali

The present war between Russia and Ukraine is the consequence of the latter's desire to join the North Atlantic Treaty Organisation (NATO) and the European Union (EU). Russia took exception to its close neighbour's plan to join the two bodies, which Russia’s President Vladimir Putin perceived as a security threat. Theoretically speaking, whether an independent country wants to remain non-aligned or to join a military alliance is solely its right and no other nation can interfere in it.

Unjustifiable step
The Russian invasion of Ukraine is outright unjustifiable. Ignoring the security concerns of Russia, NATO’s expansion to the Eastern Europe has unsettled the Kremlin and Russia perceives Ukraine’s possible inclusion in NATO as a direct threat.

From the time Soviet Union to the present period, the Kremlin sees Ukraine as part of its sphere of influence. Ukraine, however, desired to join the EU and NATO by standing gradually in favour of European integration by acclimatising with the culture, religion, civilisation and economics.
The decision by Ukraine to be a part of the Western civilisation was beyond the expectation of the Kremlin. These situations and Russian hegemony pushed Putin to invade Ukraine so that Russia could force its culture, civilisation, and strategy in favour of Russia.

The Russian aggression has heavily impacted the geopolitical security and stability of Europe and elsewhere around the globe. Social impacts include refugees, unemployment, excessive war crimes and decrease in population have serious effects on Ukraine. Conflict in Ukraine has created tremendous effects on international and geopolitical relations, international trade and transits, international security, sustainability, foreign trades, and investment in the global perspective. It has jeopardised the social and economic well-being of Ukrainians. About 4 million Ukrainians have sought asylum in European countries so far and it is continuing to rise.

The immediate outcome of sanctions imposed by the US and the EU is the rising prices of oil, gas, and other essential commodities. Rises in prices would add to inflation, which ultimately affects common people across the globe. Sanctions could fundamentally reshape the global economic order in the longer term.

Besides human suffering and large refugee flows, the war in Ukraine will increase prices of food and energy, erode the value of incomes, disrupt trade supply chains, lose the environment to facilitate FDI and business confidence, trigger capital outflows from the existing emerging markets, narrow down the financial conditions at a fast pace.

The value of Ruble has halved in a short period, and it is being propped up heavily by the central bank as it buys currency in a bid to artificially increase the desirability of the Ruble. The minimum effects of the Russian stock market are entirely strategic when it reopened divesting situation will occur. The expectation of previous forecasts for 4.4 per cent global economic growth of IMF would come down within the year 2022. Countries' involvement in direct trade, tourism as well as financial exposures would feel extreme pressure. Insecurity of foods is likely to further increase in parts, especially in Africa and the Middle East. It is because Egypt alone imports 80 per cent of their wheat from Russia and Ukraine. It will highly affect supply chains, payment networks as well as foreign currency reserves.

Ukraine and Russia will face a deep recession. Europe could see the deteriorating situation by disrupting natural gas imports and wider supply chain networks. Countries in the Caucasus and Central Asia, which have close trade with Russia, would be more affected by its recession. The loss of confidence among business people and consumers depends on how long this turmoil continues.
Wheat, crude oil, gas and metal are transported to Europe from Russia while the capacity of oil production in Russia is 10 million barrels per day. The Asia-Pacific is the potential region for oil supply. Most of the nations of the region have supported and imposed sanctions. However, these countries also are facing difficulties in the absence of regular supply.

A further increase in fuel prices will hit these vulnerable economies the hardest. Such significant repercussions could range from relatively limited to extremely serious. If such a situation of oil price soaring continues, it could easily tip the global economy into another recession. Additionally, there is potential for more unseen issues to arise.

Nepal’s stance
The heart-breaking sufferings caused by fatal, inhuman and savage attacks should be condemned. Nepal is in favour of the UN resolutions condemning and criticising Russia's cruel military intervention in its smaller neighbour. Nepal’s two giant neighbours -- China and India -- have so far stood neutral.

Likewise, Nepal has emphasised on protecting human rights by voting in favour of the Human Rights Council's proposal to investigate violations of human rights in the war along with 31 nations of the democratic alliance.

Nepal should express her concerns about such invasion and forceful capturing of territories of any sovereign countries. Small but sovereign countries of the world must learn lessons from the Russian assault on Ukraine. Many countries around the globe could be cited as burning examples. Ukraine's Crimea was occupied by Russia in 2014. Georgia was attacked by Russian troops.
Right now, Luhansk and Donetsk, unquestionably the areas of the Donbas region of Ukraine, are announced free republican states and offered the recognition.

Nepal has a bitter experience in the Kalapani areas where both neighbours signed bilateral treaties regarding the utilisation of the Nepali territories. Such a situation has called for Nepal to stand in favour of the sovereign countries, especially the smaller independent nations if their sovereignty is threatened by military invasion.

(The author is a former government secretary.)