October 2022 Full PDF final

GEOPOLITICS
THE WAR AND WHAT DOES IT MEAN TO US
WORLD IN CRISIS
ARE WE HEADING TOWARDS RECESSION?
As the ongoing Russia-Ukraine war takes a heavy toll on global economy, a looming recession coupled
with inflation has drawn intense scrutiny worldwide. Governments across the world are under extreme
pressure with the downturn economic condition that makes them caution their citizens repeatedly to
prepare for any unpleasant consequences whatsoever. Echoing the voice of the world leaders, Bangladesh
Prime Minister Sheikh Hasina has urged the countrymen to make all-out efforts so that Bangladesh never
has to face any famine or recession-like situation and food insufficiency due to prolonged war in Europe.
Why is this happening? And what do we need in case of any unexpected situation. MOHAMMAD RAFIUL
HASSAN comes up with his take on this
There is no doubting the fact that
the global economy was already
suffering from the repercussions
of several manmade conflicts, climate
shocks, COVID-19 pandemic
and rising costs over the past few
years. The Russian-Ukraine war has
only intensified these challenges
on an unprecedented scale. This
manmade war against Ukraine and
sanctions on Russia are hitting the
global economy hard. Fuel and food
prices have skyrocketed and inflation
got spiked across the globe
due to the war. Experts, therefore,
anticipate that the conflict could
trigger a global recession because
of the impact on food, energy and
fertiliser prices. Some even apprehend
stagflation and the possibility
of famine.
Of late, World Bank President David
Malpass said most countries are
heading towards recession. Some
predict the world may even return
to the stagflation of the 1970s in
which the inflation rate was high,
the economic growth rate slowed,
and unemployment remained
steadily high. International Monetary
Fund (IMF) Managing Director
Kristalina Georgieva said the future
of the global economy is bleaker
and more uncertain. Taking their
views into account and observing
the world’s gloomy condition, Bangladesh
Prime Minister Sheikh Hasina
has asked the countrymen to
be thrifty, and hardworking to avoid
possible recession or famine in the
days to come. She urged people
to make maximum use of land for
food production. It is, therefore,
important to know where the war
is taking us, and pay heed to the
premier’s warning as well as take
preventable measures for any upcoming
unpleasant situation.
The Russia-Ukraine war has created
a great deal of geopolitical
turbulence and a host of problems
in the global economy. The war is
having an outsized impact on the
global supply chain, impeding the
flow of goods, fuelling dramatic
cost increase, and creating catastrophic
food shortages around
the world. It has boosted inflation
and dented prospects for world’s
economic growth which led the
World Bank recently to reduce
‘2022 global growth forecasts’
from 4.1 per cent to 3.2 per cent -
due the impact of Russia's war on
Ukraine.
People in general are mainly concerned
about how the war will affect
their daily life and purchasing
power. So, the main worry for the
common people is the increasing
prices of basic necessitates like
food and energy. The war caused
the price of food rise after Russia
imposed a ban on grain export
from Ukraine. In addition to food
prices, sharp hike in energy prices
caused by sanctions on Russia,
and Russia’s decision to suspend
gas deliveries to several EU member
states negatively affected
household and increased living
costs around the globe.
Interestingly, global food markets
are extremely concentrated, both
in terms of supplies and reserves.
Russia and Ukraine supplied
about 30% of the world's wheat
and barley before the war. Thirtysix
countries, including some of
the world's most vulnerable and
impoverished, relied on them for
more than half of their wheat imports.
Such concentrated and thin
markets mean that when crises
like the war in Ukraine happen,
the global supply of food can be
derailed quickly, leading to high
costs. For example, insurance premiums
are skyrocketing for vessels
operating in the Black Sea,
which only further raises prices for
staple foods.
As the war drags on, already record
levels of acute food insecurity
are expected to sharply rise,
and acute hunger is projected to
increase from 276 million to 323
million according to U.N. World
Food Programme (WFP), Consequently,
a recession or famine
situation is apprehended by many
in the coming days.
“Global growth is slowing sharply,
with further slowing likely as
more countries fall into recession,”
World Bank President David
Malpass said, adding his worry
that these trends would persist,
with devastating consequences
for emerging market and developing
economies. Rizwanul Islam,
a former adviser at the International
Labour Office in Geneva
said “whether another recession
will hit or not, the US growth is already
stalled. So, it is bad enough
to suspect that the major engine
of the global economy is faltering.”
He also said GDP growth in
Europe was virtually nil and the
growth in China also has dropped
significantly. This will create
ripple effects on the rest of the
global economy and it will include
Bangladesh.
BANGLADESH’S ECONOMIC REALITY AND GOVERNMENT’S CAUTION
Continued disruptions in the global supply chain due
to war have raised the spectre of recession globally.
Hence, Bangladesh might not escape unscathed if a
global economic downturn hits. At the beginning of
2022, Bangladesh's economy seemed to be on course
to grow at a faster rate. But things began worsening in
late February following the war. Although neither Russia
nor Ukraine is a large export destination or sourcing
nation for Bangladesh, they are vital to the countries on
which the country relies to drive its growth.
Zahid Hussain, a former lead economist at the World
Bank said, “as per forecasts, a recession will come towards
the end of 2022 and most of the European countries,
dependent mostly on Russia for their energy, will
Vegetable market in Dhaka
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