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The Russian invasion of Ukraine is being considered the ‘darkest hour’ in Europe since World War II which can potentially spiral out of control in a much greater conflict. Russian President Putin, riding high on expansionist ambitions, authorized a full-scale military operation in Ukraine by land, air, and sea after weeks of fruitless diplomatic efforts to avert war.
Russian missiles rained down on Ukrainian cities as troops landed in border cities. At least 50 Ukrainian soldiers have already been reported killed. Explosions were also heard in the capital Kyiv as residents fled as the UN warned of a refugee crisis. Ukraine severed diplomatic ties with Russia, imposed a state of emergency, and urged its citizens to pick up arms against the invading forces. NATO chief held back saying it has activated ‘defence plans’ but has no plan to send troops.
The economic effects are already being felt. Global financial markets plunged and oil prices surged amid concerns that a prolonged conflict could push up energy prices, increase inflationary pressure and slow economic growth. Russian currency felt to all-time low and the Moscow stock exchange dropped by 10 percent in a single day. Russia accounts for about 12% of the world’s oil supply and provides about 40% of gas to the European Union. The conflict has heightened risks of disruption as pipelines pass through Ukraine.
US and EU allies have not responded to the hostilities except for making statements that Russia will be taught a lesson. The West is preparing stiffer sanctions but it will have far-reaching impact on the global economy and are unlikely to have significant impact on Russia. The prospect of war and sanctions posed a threat to a global economy barely emerging from the pandemic.
Ukraine voted overwhelmingly for independence after the fall of the Soviet Union, and aims to join NATO and the European Union, aspirations that infuriate Moscow. Putin has called Ukraine an artificial creation carved from Russia by its enemies. He has since been harbouring expansionist tendencies but it has created an insecure world.
