Growing Economic Woes in Europe: Fallouts of the Russia-Ukraine War?

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Economic hardship in Europe is increasing the risk of a recession in the coming days. The prolonged Russia-Ukraine war and the global pandemic have a devastating impact on the European economy. The situation has deteriorated so severely that some economists have even begun to claim that Europe is currently having the biggest economic crisis since World War II. Both the macroeconomic and microeconomic parameters are gravely affected by high inflation carried forward by rising energy and commodity costs, the rising depreciation of the euro against the dollar, a reduced growth rate, and an alarmingly rising rate of unemployment. Additionally, Europe may experience severe problems this winter as a result of the region’s energy crisis and the interruption of Russian energy supply. In light of this, it is essential to address the grave economic problems that Europe is currently experiencing. The study created three queries to help with the analyses in this regard. First, what is the current state of European economic stagnation? Second, how and why is Europe in such a financial crisis? Last but not the least, what are the impacts and what will be the future repercussions of the economic woes?

It is essential to illustrate the European economy’s contribution to the world economy, primarily the total share of the European Union. It should be remembered that, in nominal terms, the EU economy is third in the world only to China and the US. In 2020, its GDP was projected to be US$17.9 trillion, or almost one-sixth of the world economy. Despite these upbeat economic indicators and a sizable stake, the European economy is struggling to recover from its current state and return to its pre-pandemic growth situation. Additionally, because Germany accounts for 21% of the EU’s GDP, its economic problems are having a significant impact on the dispute.

– Saddam Hosen is an Assistant Professor of International Relations at Bangabandhu Sheikh Mujibur Rahman Science and Technology University (BSMRSTU), Gopalganj, Bangladesh.

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