Sanctions cutting off Russia’s access to chips and payments systems, plus spiking food and energy prices, will prompt governments to rethink trust in free trade. An inefficient protectionist era may be in the offing, says ugalani
and Mastercard overseas. Had Russia not invaded Ukraine, restrictions would not have been applied, and they would be partially wound down if Moscow agrees to withdraw. But for governments worried about being subjected to similar treatment someday, or those simply stuck in the cross-fire, the sight of the West wrecking a G20 economy over the course of just a few weeks gives food for protectionist thought.
During the pandemic, officials facing shortages of key medical equipment or electronics components rushed to onshore or re-route crucial supply chains as much as they could, with mixed success. Now, with Moscow warning of $300 per barrel oil prices and farmers panicking that lack of fertiliser will halve crop yields, this decoupling trend is now likely to accelerate.
Self-sufficiency also implies more global inefficiency as countries duplicate goods and services better imported, and will further increase the price of key commodities. China’s push for self-reliance, for example, has led to massive overcapacity which it shovels into export markets, a tension that led to the trade war in the first place. If everyone moves in the same direction, they could quickly run out of export customers.
- On the same day, U.S. President Joe Biden banned U.S. imports of Russian oil in retaliation for the invasion of Ukraine. The United States is not a leading buyer of Russian oil. Europeans, who are far more reliant on it, have been reluctant to follow suit. - Britain, however, said it would also phase out the import of Russian oil and oil products by the end of 2022, while the EU published plans to cut its reliance on Russian gas by two thirds this year.Editing by Pete Sweeney and Thomas ShumReuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day.
Australia Latest News, Australia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Russia-Ukraine live updates: Ukraine denounces proposed evacuation corridors to Russia, BelarusLocal Ukrainian leaders said there was no confirmation of a temporary cease-fire as Vladimir Putin's military continued its attacks.
Read more »
Russia-Ukraine war: Russian military commander POW claims forces were told 'Nazis' had overtaken UkraineA Russian military commander and prisoner of war said he and his forces were led to believe they were invading the country because 'nationalists, Nazis have seized power.'
Read more »
Russia-Ukraine War: What to know on Russia’s war in UkraineRussia’s invasion of Ukraine entered its 12th day following what Ukrainian authorities described as increased shelling of encircled cities and another failed attempt to start evacuating hundr…
Read more »
Russia-Ukraine War: What to know on Russia's war in UkraineRussia’s invasion of Ukraine has entered its 12th day following what Ukrainian authorities described as increased shelling of encircled cities and another failed attempt to evacuate civilians from the port of Mariupol.
Read more »
Russia-Ukraine live updates: Evacuation attempts resume as U.N. says 2 million have fled Ukraine2 million have fled Ukraine since invasion began, U.N. refugee chief says, as evacuation attempts resume. Follow our live coverage.
Read more »
Russia-Ukraine war: 2 million have fled Ukraine since invasion, UN saysTwo million people have fled Ukraine in the two weeks since Russia's invasion, the United Nations' refugee chief said Tuesday.
Read more »