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Is the War in Ukraine Leading to Global Recession   

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Grain harvesting in Xizhou county

The War in Ukraine, sparked by the February invasion of Russian troops in the country, has been ongoing for over three months, and its economic impacts are profound. 

For one, 29% of the world’s wheat, 20% of its corn, and a whopping 80% of its sunflower oil are produced in Russia and Ukraine. Indeed, Ukraine is often called the “breadbasket of Europe,” representing its crucial role in European — and indeed, global — food supply chains. With Ukrainian exports halted due to the war and Russian exports restricted by sanctions, many countries are grappling with food supply shortages and skyrocketing prices. Moreover, many nations — particularly those in Europe — are dependent on Russian oil supplies. With the war and effects of Russian oil sanctions, these countries are similarly struggling with rising oil prices. 

These are just some signs, which indicate that we are facing an impending — or perhaps ongoing — global recession. As prices of many basic commodities rise, consumers’ spending power decreases — a telltale sign of recession. Moreover, we already see trends of global GDP growth rates decreasing; in the U.S., for example, the GDP decreased at an annual rate of 1.5% in the first quarter of 2022, according to the U.S. Bureau of Economic Analysis. 
Importantly, the War in Ukraine is not the sole spark of the global economic downturn. It comes while countries’ economies are still recovering from the Covid-19 pandemic. Significantly, lockdowns in China are still in place, stagnating economic growth in the world’s second-largest economy. Combined with the effects of the war, we see clear signs of a global recession. Looking ahead, governments must examine the economic effects of the War in Ukraine and the pandemic in tandem to determine the most effective global economic strategy.

All views expressed in this editorial are solely that of the author, and are not expressed on behalf of The Analyst, its affiliates, or staff.

Economics

Africa taken Hostage on Ukraine – Russia Conflict 

Africa taken Hostage on Ukraine-Russia Conflict, which can be seen as in March this year, 26 African states failed to votes in agreement with the UN resolution condemning Russia’s invasion of Ukraine.

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Africa taken Hostage on Ukraine – Russia Conflict

In March of this year, twenty-six African states failed to vote in agreement with the UN resolution condemning Russia’s invasion of Ukraine. Seventeen African states abstained from the vote, eight were not present, and Eitrea remained the only African nation to vote against it. Out of the 54 nations that make up Africa, 28 voted in favour of U.N resolution.  In contrast of Africa’s 51%, 81.29% non-African countries represented in the U.N voted in favour of the resolution – and what’s more, only four heads of African states showed up, with the rest sending representatives.

But why is there such a marked divide on the question of Russia-Ukraine, compared to the rest of the world? Why is Africa taken Hostage on Ukraine – Russia Conflict? And what did they have to say about it? 

Memories of Apartheid

For some African nations, their reluctance to take sides in this world-engulfing conflict can be traced back to recent history. When Europe was backing the apartheid government of South Africa, it was Russia, then the Soviet Union – ever the opportunist superpower searching for political and financial hegemony -which provided military training, ammunition and morale to the South African movement fighting to take back their country from the racially discriminatory system of Apartheid headed by the government in Pretoria. 

As veteran South African freedom fighter Obbey Mabena said, speaking to the CNN’s David Mckenzie on the struggle for apartheid, “We had to decide if we wanted to continue living on our knees, or to die fighting.  We found that there is a country like the Soviet bloc that is ready to give us everything that we need. To give us food, uniforms, to give us training, weapons.”

Mackenzie asks, “So these were Russian soldiers treating you with respect?”

“With the greatest of respect, they came there, they were friends with us. For the first time we came across white people who treated us as equal beings …Russia is our friend. Our friend’s enemy is our enemy.”

The response by Ukraine’s most powerful backer, the United States, did not seem to be pleased with the outcome of the African vote on the UN resolution in March, condemning Vladimir Putin’s invasion of Ukraine. As US ambassador to the African Union Jessica Lapenn said  that, “we look for a strong African response to Russian aggression and welcome the opportunity to partner with Senegal and other Africans on both the response to Russia’s aggression but also to address the implications of it globally”.

Global Food Crisis 

Indeed, that may be the case. In a recent address to the African Union, mirroring earlier attempts to garner support from the continent for Ukraine’s plight, Ukrainian President Volodimir Zelensky claimed that Africa  had been taken hostage by Russia citing the looming food crisis as shortages of grain and fertiliser to the continent come as a result of Russia’s naval blockade of Ukraine’s Black Sea port.

Africa taken Hostage on Ukraine-Russia Conflict-  image of Odessa harbour, Ukraine
Africa taken Hostage on Ukraine-Russia Conflict – Odessa harbour, Ukraine

Before the war began, Russia and Ukraine were Africa’s biggest exporters of wheat, accounting for about 40% of its total exports – currently twenty million tonnes of grain have been left stranded at the Black Sea port of Odessa due to Russia’s naval blockade, ushering in a new crisis for the continent. President Macky Sall, Head of the African Union met with Russian President Vladimir Putin earlier this month to highlight the detrimental effects of the blockade on Africa’s food supply.

While possible, it is more difficult to grow wheat in Africa than other countries due to the climate, and the lack of equipment available for timely harvesting, hence, much of it is imported.

The Red Cross reports that in Africa, “Over 100 million people are struggling without the food that they need.” One of the reasons cited for this is the global rise in prices due to the conflict in Ukraine. 

Divided Loyalties 

But that’s not the only way – nor the least detrimental – that the conflict between Russia and Ukraine is hurting Africa. Sanctions aimed at Russia by the West have particularly hurt Africa’s economy, from Russia being one of the main providers of Africa’s defence and military equipment, to Western sanctions halting investment into the Russian economy and impeding billion dollar nuclear energy deals that help provide electricity to many countries in the north of the continent.

That effect has petered out to impact the looming food crisis even further, as the Russian Swift banking system has been suspended by Western states, making it impossible for Africa to pay for its food imports like grain and fertiliser from Russia. Such has been the effect that some have considered diversifying the region’s wheat sources, the first time in years.

China, an ally to Russia in the war, is now Africa’s biggest trade partner.  Speaking to Forbes, Daan Roggeveen,  who writes about urbanisation in China and Africa, said, “Right now you could say that any big project in African cities that is higher than three floors or roads that are longer than three kilometres are most likely being built and engineered by the Chinese. It is ubiquitous.”

And of course, the West provides $134 billion of aid each year.

The foreign minister of South Africa, Naledi Pandor, the UN resolution vote against Russian activity in Ukraine states that, “The response we got was, take it or leave it. And in the face of that arrogance, we thought the only decision we could make was abstain. Perhaps our colleagues in the West don’t understand the fact that we are very weary of aligning to one position or another.”

For a continent in which its loyalties are immensely divided, between its trade partners, food exporters and aid providers, that indeed may be the case.

So perhaps Zelensky’s claim that it is only Russia that has taken Africa hostage- tha     needs to be re-examined. Rather, it seems Africa is being held hostage by the world, as each brings up past favours and debts to coerce the unaligned continent into fighting for their side, in a war that will reap no benefits for the continent itself. And perhaps, like in the past, it will be left struggling in the aftermath without support or compensation.


All views expressed in this editorial are solely that of the author, and are not expressed on behalf of The Analyst, its affiliates, or staff.

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Economics

Critics claim, G7 failed to combat food crisis

G7 failed to combat the food crisis. The summit which comprised diplomats from Canada, France, Germany, Italy, Japan, the UK, and the US, discussed several issues, with the Ukrainian War at the top of their agenda.

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2022 - G7 failed to combat food crisis

The G7 gathered last week to discuss how to tackle the global food crisis that has been exemplified through the Russian and Ukrainian War, however critics claim that the G7 failed to combat food crisis issues. The summit which comprised diplomats from Canada, France, Germany, Italy, Japan, the UK, and the US, discussed several issues, with the Ukrainian War at the top of their agenda.

On 28th June, the G7 promised to spend $4.5 billion this year to address the global hunger crisis. Amid this pledge, the G7 has urgently requested for the Russian Government to end the blockade of Ukrainian Sea ports. The blockade has led to a halt of Ukraine’s exports including essential goods such as cooking oil and in particular, cereals such as maize and wheat. As of April 2022 the price of oils has increased by 137.5% compared to the averages of  2014-2016, whilst the price of cereals has increased by 69.5% compared to the 2014-2016 averages. In a statement on the support for Ukraine, the G7 stated, “We urgently call on Russia to cease, without condition, its attacks on agricultural and transport infrastructure and enable free passage of agricultural shipping from Ukrainian ports in the Black Sea.”

The $4.5 billion pledge is to help those who are the most vulnerable from hunger and malnutrition, but it will not be enough to help protect all those suffering from the global food crisis. 

Several activists have called out the G7 for falling short on what is needed to tackle the crisis. Max Lawson, the Head of Inequality Policy at Oxfam stated, “The G7 have simply failed to take the action that is needed”. Additionally, Lawson expressed that, “The $4.5 billion announced is a fraction of what is needed. The G7 could have done so much more here in Germany to end the food crisis and prevent hunger and starvation worldwide”. 

Furthermore, the World Food Programme (WFP) urged the G7 to, “act now or record hunger will continue to rise and millions will face starvation”. The WFP’s plan requires $22.2 billion from the G7 to help those who are suffering from the crisis, however, the G7 pledge is far from it, $17.7 billion less than what is needed. This comes after the WFP suspended food assistance to South Sudan due to a lack of funding and priorities elsewhere. South Sudan is one of the worst affected countries by the global food crisis as internal conflict, the effects of the COVID-19 pandemic and climate change has all led to inflated food prices within the country. 

South Sudan is not alone, extreme weather and the impact of the COVID-19 pandemic previously inflated global prices, the Ukrainian War only exemplified it. Climate change has led to the increase in frequency and intensity of extreme weather events such as flooding, droughts and megafires. The recent earthquake in Afghanistan and flooding in Bangladesh

are just some examples as to how climate change has increased the likelihood of extreme weather to occur. Extreme weather has damaged crops in several countries, thus, not only damaging the supplies of food for the countries themselves but also for the rest of the world. Alongside extreme weather, the COVID-19 pandemic has severely inflated global food prices. The pandemic caused supply chain disruptions which increased food prices. However, the downside of supply chain disruptions is panic buying and hoarding, which increased the demand leading to further inflated prices. 

All views expressed in this editorial are solely that of the author, and are not expressed on behalf of The Analyst, its affiliates, or staff.

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Daily Brief

Russian Forces Finally Abandon Snake Island as a Gesture of Goodwill

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Battle of Snake Island 2022
  • Russian forces have officially abandoned Snake or Zmiinyi Island as a gesture of goodwill in order to prove that it was not obstructing grain exports. But this claim was instantly dismissed by Ukraine once Moscow continued to shell its grain stores. 
  • Snake Island was seized by Russians on February 24; the island, which is just 22 miles away from Ukraine, is exposed to attacks from all directions, including air and sea. Once Russia seized it, Ukraine attacked the island itself and any vessels carrying troops or heavy weaponry. 
  • Ukrainian military analyst Oleh Zhdanov states that controlling this island and stationing troops doesn’t make sense for either side and the island is an easy target. He argued that maintaining “fire control,”.which is having the capability to strike any target approaching the island, is a better advantage for either side. 
  • The key question is whether the Ukrainians will consider  exporting grain to reboot the war economy. However, the Russian warships still gain dominance over the Black Sea, and although they are offering Ukraine to export grains from Odessa, Ukraine rejected it due to it having to remove mines from outside the port. 

All views expressed in this editorial are solely that of the author, and are not expressed on behalf of The Analyst, its affiliates, or staff.

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Daily Brief

Russian Missile Sets Ukraine Shopping Center on Fire

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781px Nevsky Centre Shopping Mall in Russia
  • A busy shopping center in Ukraine was set on fire by Russian missiles on Monday, killing at least thirteen people and injuring dozens. The total number of casualties is still unknown.
  • Ukrainian President Volodymyr Zelensky stated that “The number of victims is impossible to imagine” and that there could have been up to 1,000 people in the mall.
  • The attack came during the G7 summit, where world leaders condemned recent atrocities and promised to support Ukraine “for as long as it takes” in a joint statement. President Zelensky spoke to the leaders at the summit and stated that he wants the war to end before winter.
  • NATO has decided to increase the number of troops in its rapid reaction force from 40,000 to 300,000, more than eightfold. NATO Secretary-General Jens Stoltenberg stated this move is part of the “biggest overhaul of collective defense and deterrence since the Cold War.”
  • The United States has announced that it will provide Ukraine with advanced medium and long-range air defense capabilities.

All views expressed in this editorial are solely that of the author, and are not expressed on behalf of The Analyst, its affiliates, or staff.

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Daily Brief

The EU Approves Ukraine for Candidacy

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Munster Stadtweinhaus Beflaggung Ukraine und EU 2022 0219 scaled
  • The EU has finally approved the application of Ukraine to become a candidate country for admission to the 27- country organization. Ukraine will now join the official candidate list, which already includes Albania, the Republic of North Macedonia, Montenegro, Serbia, and Turkey. 
  • The US is expected to provide an additional $450m in security assistance to Ukraine. Which includes four more High Mobility Artillery Rocket Systems. 
  • The EU and Norway have agreed to cooperate and provide the EU’s 27 countries with gas from Western Europe’s biggest provider. The EU imports roughly ⅕ of its gas from Norway compared to the 40% it was receiving from Russia. Currently, Russia has been cutting gas supplies to countries refusing to pay for it in roubles. 
  • Melbourne is considering utilizing its largely vacant $200m Center for National Resilience building to house hundreds of refugees fleeing war-torn Ukraine and Afghanistan. The center will only be able to temporarily house about 500 refugees from Afghanistan and about 200 from Ukraine. 
  • Ukrainian Defense Minister Oleksii Reznikov thanked US Defense Secretary Lloyd Austin after receiving and welcoming the High Mobility Artillery Rocket Systems (HIMARS) from the United States. 
  • Nike joined other leading Western brands by formally making a full exit from Russia, three months after suspending its operations. Telecoms equipment maker Cisco is also planning to wind down business in Russia and Belarus as well.

All views expressed in this editorial are solely that of the author, and are not expressed on behalf of The Analyst, its affiliates, or staff.

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Daily Brief

Ukraine Receives German Delivery of Long Range Weapons as Putin Announces ICBM

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Anti terrorist operation in eastern Ukraine War Ukraine 26832552950
  • Ukraine has announced that they’ve recently deployed a number of long-range weapons sent from Germany. Ukrainian Defence Minister Okeysii Reznikov recently thanked Germany’s Federal Minister of Defence for the howitzers they received. The delivery comes after Germany announced plans last month to step up their delivery of weapons to Ukraine. 
  • President Vladimir Putin has also disclosed plans for Russia to deploy Sarmat intercontinental ballistic missiles around the end of 2022. The deployment of ICBMs is part of Russia’s larger plan to strengthen their military through improved weapons such as the S-500 air defense and missile defense systems.
  • As both Russia and Ukraine expand their military arsenal, more settlements have been captured by Russian forces in the Luhansk region of Ukraine. Governor Serhiy Haidai has shared that Russian forces have captured the settlement of Toshkivka and several other settlements nearby. President Zelensky states in a video address that the current situation in Luhansk has been tough as Russian forces push into key areas of the region.
  • Meanwhile, massive amounts of wheat and grains remain stuck at the Black Sea ports of Ukraine. Turkey plans to initiate dialogue with Russian, Ukrainian, and United Nations officials about opening up corridors that would allow for safe grain export. The White House has stated that President Joe Biden has also been examining options for the safe exportation of grain with White House national security spokesperson, John Kirby, calling the grain blockage a weaponization of food.

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All views expressed in this editorial are solely that of the author, and are not expressed on behalf of The Analyst, its affiliates, or staff.

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Samar is a UC San Diego graduate with a degree in Communication and a minor in Business. In addition to her passion for research and writing in relation to current events, she also utilizes her skills in areas such as digital marketing. Furthermore, she is deeply interested in positions that involve oral communication skills such as leadership roles and public speaking.

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