Yogyakarta, February 17th, 2023
Master of Science and Doctor (MD) FEB UGM has successfully held a Guest Lecture with the latest topic, “The Impact of War towards European Economic,” on February 17th, 2023, which held offline in BRI Auditorium 3rd Floor of MD FEB UGM Building. This event, which opened to the public, took place from 09.00-11.00 WIB. This activity presented Mrs. Monika Didzgalvyte-Bujauske, Ph.D., Vytautas Magnus University, Lithuania, as a speaker and Mr. Reza Bangun Mahardika, S.E., M.Sc., Lecturer at the Faculty of Economics and Business UGM, as moderator. Participants who attended were students, alumni, and academics.
In the current era, economic turmoil is increasingly occurring due to various factors. One of them is war. A war between countries certainly has an impact on economic stability. The discussion in this public lecture was interesting because it raised the issue of the war between Russia and Ukraine that occurred some time ago and resulted in an economic crisis in Europe. Apart from disrupting human life in the two countries, world peace is also disrupted, especially in the countries around it. Economic cooperation relations automatically disrupted due to conflicts of interest.
The Russia-Ukraina war caused a lot of damage, losses, and loss of life. The increasingly heated conflict further pushed the economic crisis in Europe. Several sectors that were disrupted were the agricultural, automotive, financial, and tourism sectors. More than that, the war caused a surge in commodity prices, which in turn triggered inflation.
The impact of war felt by the European Union countries are several things. First, disruption to the automotive sector in Germany, where Germany limited car production because of the war has halted the delivery of key components, such as ware harnesses. This will disrupt Germany’s economic recovery, which was already suffering from complex supply chain problems. Second, disruption of agri-food production in Netherlands, where the food manufacturing industries exposed to a halt in wheat imports from Ukraine and Russia (the two countries account for more than a quarter of global wheat trade). The meat and dairy industries are also declining as Ukrainian maize is widely used to feed livestock (globally, only 12% of maize is used for food consumption, with 60% used for animal feed). For their fertilizers, European farmers rely heavily on Russia and Belarus. Third, the impact on the forestry industry in Finland, where the declining supply of wood from Russia accounts for half of the country’s total imports. The forestry industry in Finland is responsible for about one-fifth of Finnish exports and accounts for about 20% of industrial production and 15% of industry employment.
The war also hampered post-pandemic economic recovery. The war sparked a humanitarian crisis and a projected 35% decline in Ukraine’s GDP by 2022 with an estimated over $100 billion in civilian infrastructure. There are various restrictions on Russian economic activity, namely the withdrawal of Russian banks from SWIFT, which is an international monetary transfer system, blocking Russia’s access to its reserves, which are located on the banks of other countries, and boycotting Russia by international companies (Coca-Cola, McDonald’s, Starbucks, Levi’s, Airbnb, Apple, Visa, Mastercard, Ford, Boeing, etc.).
Many new things were obtained from the discussion of this public lecture. Discussions on current economic issues can broaden horizons and encourage critical thinking skills on phenomena. After the material session, participants actively participated in an interactive question-and-answer session. After two hours, the event ended with a group photo session. (Y)