By Mandelaw Bageru
The World Bank, the economist, and the Western media have all been bidding to portray the image that the ongoing economic globalization order since the last four decades has tirelessly been helping the overwhelming majority of the poor population worldwide.
Yet, the whole idea and mission with the economic globalization order is a soft instance of silent scramble for economic expansion internationally and for manipulation and eradication of all the rights of free market and individual freedom. In the affluent Western world, each nation and the structure implanted to galvanize the globalization economic fabric have been swayed by unscrupulous incumbent politicians. Through well-established lobbyists’ systemic manipulative thievery schemes, the actual rights citizens have been influenced in favor of the corporate governing bodies in each rich country. In such situation, there is no way to think about popular public-interest-driven radical movements anymore. Nor is it that easy to fight for true democracy.
The hard security measures put in place via NATO-alliance is given unrestricted freedom to round up and attack any other nation that is potentially suspected to stand against its globalization mission. This fight is employed by way of provocation for war, and at the same time, devising scapegoating issues in the name of fabricated and fake claim about violation of human rights and terrorism. These items then become well-structured to disseminate through all branches of the mass media tools and directly suffocate any popular movement that could go against globalization’s amassing of capital and financial prudence.
We have seen this systemic self-defensive fighting mechanism in a few left leaning democratically elected governments in Latin America, Africa and parts of Asia. If the country that got assimilated in the global capital cabal does not play along with global capital elites, it will be a target of smears and even will be evicted from power or deposed. Very few countries have been able to escape from such heinous attacks.
Having experimented applying sanctions against smaller countries since the 1960s beginning with Cuba, Western policymakers have only limited experience and understanding of the effects of truly severe measures against a major, globally connected economy like Russia. Existing fragilities in the world’s economic and financial structure mean that such provocative sanctions will have the potential to cause grave political and material fallout globally and would result in a boomerang economic upset worldwide.
Let us look at the Russia Ukraine events in recent weeks. Instead of recognizing the demand for independence of Donetsk and Luhansk People’s Republics, where the entire population is Russian-speaking ethnic group that is discriminated by Nazi-Ukraine political parties, the Biden administration opted to impose sanctions not only on Russia, but also on these two Republics in support of the sitting Ukrainian pro-Nazi government, by prohibiting investment, trade and financing with people in those regions. Yet, let us not forget, minor interruptions in one region can generate major disruptions far away. Isolated shortages and price surges— whether of gas, wheat, aluminum or nickel, can escalate in a world still struggling to recover from the ongoing COVID-19 pandemic.
Let us not forget, globally there is high inflation, stressed produce supply chains and transportation services, uncertainty about what major central banks are going to do and how insistent price rises are going to be periodically. These few mentioned economic stresses are momentarily piling on financial prudence that are still recovering from the economic body blows inflicted by the COVID-pandemic. Already, the pandemic literally stopped cross-border flows of capital, goods and people worldwide.
The Russia-Ukraine regional conflict is by now further slowing the global economic activity and raising prices sky-high. At present the systemic spillover effects on the global economy have caused turmoil in the worldwide commodities markets. Prices of natural gas, wheat, copper, nickel, aluminum, fertilizers, and gold have started to rise. Because the Russian-Ukraine conflicts has closed the Ukrainian ports and international companies are isolating Russian commodity exports, a grain and metals shortage now looms over the global economy. The price shock to energy and commodities across the global commodities exchange will push global inflation higher. African and Asian countries that are purely reliant on food and energy imports are already experiencing marketing complications.
On the other hand, let us not forget, Russia is a resourceful state and naturally endowed with natural resources to depend on and counter the isolation exerted on its economy. In fact, it has some of the powerful Globalization club members like Germany, France, Turkey, the United Arab Emirates, Saudi Arabia and China in its pow for supplying natural gas and coal.
Besides, by standing in solidarity with countries that fought to free themselves from the yoke of colonialism, Russia has always been investing on the education of 70% of its own population mainly and purely with hard core natural and life science academic trainings. As a nation, Russia may not have the miniature and slick product that western world simple claims to be proud about; yet Russia is a huge global might when it comes to science put and compared on the educational achievement scales. Russia is close to becoming self-sustained as much as Chania is and probably no longer requires anything substantive material wants from the Western technology to strive.
In actual facts, on global scale, Russia is a large hydrocarbon sector, a sophisticated military industrial complex, and a diversified basket of commodity exports. As such, it is the Western world that needs raw commodities from Russia including coal and gas-resources. Just check Wikipedia about Russia and you will be surprised that they are in every sector in top ten countries. The Western attempt to isolate Russia will only strengthen Russia to push harder on the economic front just as China did in the last half a century. After all, Russia is among the less indebted self-contained countries like those in Scandinavia.
In February 2022, the central bank and the Russian government jointly decided to take a series of actions, including doubling a key interest rates to 20 percent to increase the ruble’s appeal, barring people from transferring money to overseas accounts, and closing the stock market to contain the damage and tamp down panic.
The Boomerang Effect of Sanctions
The sanctions strategy followed by the Western NATO Alliance is already impacting a boomerang economic effects worldwide. The immediate consequences of the sanctions exerted on Russia have been causing more harm to the Western world itself and to the rest of the global family than to Russia alone. In that sense, The Western-NATO Alliance have shot themselves on the foot. A case in point besides Germany is Hungary. This country is greatly dependent on energy imports from Russia. In January 2022, it reached an agreement with the Russian power firm, Rosatom, to expand Hungary’s only nuclear plant in a 10 billion euro (i.e., $13 billion USD) deal. Likewise, Russia is also Hungary’s largest trading partner outside the European Union (EU), with exports totaling 2.55 billion euros worth annually. Therefore, Hungary is facing unexpected economic disorder due to the Russian-Ukraine unresolved feud directly provoked and fueled by Western NATO-Alliance Powers.
In the USA, the gasoline prices are roughly a dollar higher than in 2021, with a national average of $3.61 a gallon, according to AAA. This in itself is worrying the American public, not clearly knowing where this economic stress would lead especially the working class households.
Above and beyond, Russia closed its airspace to 36 countries, which means shipping planes will have to divert to roundabout routes, leading them to spend more on fuel and possibly encouraging them to reduce the size of their loads. Besides, Thousands of people are fleeing Ukraine and streaming into neighboring countries like Poland, Moldova and Romania, which could add to their costs. Already an estimated 2 million have left Ukraine, and some three million are internally displaced people. Eventually, Western Europe will be saturated of refugees fleeing the region for political and economic reasons.
What’s at Stake for the Global Economy
After getting injured by the COVID-pandemic, suddenly, the global market’s supply chain that has been moving through supply shortfalls and leaps in prices, is yet to move through additional volatile course provoked by NATO alliance block clique for want of war with Russia.
Even before the Kremlin ordered Russian troops to make a move into the separatist territories of Ukraine in late February 2022, the tension had taken a toll. Out of contempt and double-dealer’s pride, the promise of punishing sanctions in return by President Biden and the potential for Russian retaliation had already pushed down stock returns and driven up gas prices worldwide, including the USA itself.
The ongoing outright attack by Russian troops by encircling Ukraine and the Ukrainian Nazism hooligans against Russians and other minority ethnic groups in the region, has already caused freezing spikes in energy and food prices, fuel inflation fears, and even shocked investors, a combination that threatens investment and growth in economies worldwide. Against the Biden administration’s miscalculated and outdated sanction strategic effects, the immediate impact will be nowhere near as devastating as the sudden economic shutdowns first caused by the COVID-19 pandemic in 2020. To one’s dismay, Russia is a transcontinental entity with its 146 million people and a huge nuclear arsenal, plus the main supplier of natural resources like oil, gas and raw materials that keep the world’s factories persistently running on daily basis.
Under normal circumstance, Europe gets nearly 40 percent of its natural gas and 25 percent of its oil requirements from Russia. That means, most NATO alliance countries, are going to be trapped with spikes in heating and gas bills if they follow suit the entire ambitions of EU sanctions. Prices are already soaring. Natural gas reserves are at less than a third of capacity, with the ongoing cold winter weather.
As stated by a recent United Nations report, food prices steadily continue to unwaveringly climb to their highest level in more than a decade mainly owing to the COVID-pandemic’s supply chain chaos. It is well known that Russia is the world’s largest supplier of wheat, and together with Ukraine, it accounts for nearly a quarter of the total global exports required worldwide. For some countries, the dependence on its supply is much greater. For instance, the flow of grain from Russia and Ukraine makes up more than 70 percent of Egypt and Turkey’s total wheat imports. Ukraine alone, sends more than 40 percent of its wheat and corn exports to the Middle East or Africa, where there are worries that further food shortages and price increases could stoke social unrest. Take for instance, the case of Lebanon, which is experiencing the most disturbing economic crises in more than a century. Actually, it gets more than half of its wheat demand supplied from Ukraine.
Due to the ongoing political disability in the region, the importation process is already putting further strain on Egypt, Lebanon, and Turkey, which is already in the middle of an economic crisis and struggling with inflation that is running close to 50 percent, with skyrocketing food, fuel and electricity prices in the region.
To put fuel on the already burning fire, those countries that depend on the Russia-Ukraine region’s rich supply of energy, wheat, nickel and other staples suddenly started to feel the pain of the current price spikes. Consequently, the EU has no choice, but, to handle, not only to compensate the NATO alliance member country producers in parts of Europe suffering due to the recent Russian import ban on a range of foods from the EU member countries like Poland, Slovakia, Hungary or Greek alone, but also, compensate the remaining Western European countries as well, that now are suffering from the losses owing to the sanctions exerted on Russia and the ban declared by Russia in retaliation to the sanction.
Besides, the entire sanction against Russia and the actions taken by Russia in retaliation to it, is injecting a huge dose of uncertainty and volatility into the global economic decision-making processes, heightening the economic decline risk to the global outlook. The ongoing conflict is already creating commodity shortages in the global market arena; and damaging the domestic economy of NATO member countries. The pressure of this sanction’s burden mainly falls heaviest on the most vulnerable poorer people who spend a higher share of their scanty incomes on food and heating, especially those inhabitants in the temperate climatic zones, the middle East and Africa.
Therefore, this paradoxical geopolitical matter should be given serious thought and be reviewed and reconsidered for adopting other peaceful solutions rather than opting for militaristic solutions. It should avoid, Western hypocrisy and cynicisms that has no place in this 21st century. Dialogues should be based on mutual respect and genuine and mutually consultative open dialogue on national, regional and global concerns that must be resolved with the aim for achieving lasting solutions.
Generally, looked at democracy at play from principal perspectives, in every Western country, there exist almost only two main parties that dominate the governing roles over the general public in the last hundred years. Through the years, some of these Western parties have established family-led dynasties that take turns and role-over-power among the family hold and sway the public with their hypocrisy and cynical contempt as they deem governance fit their vested corporate interest run both overtly and in clandestine. What they utter as serving the “public interest” is simply lip-service and window-dressing to empower themselves as legitimate rulers on behalf of democracy. Take for instance the case in the USA. What is so democratic about suppressing the majority of Black American and Native American communities in the Ghetto parts of America, left to choose between belligerent far right, center or left government that only provides lip service to them? Unless exceptional, in most cases, Blacks, Native Indians and other minorities are born as second class citizens. And yet there is too much bragging about human rights violation and autocratic governance elsewhere. It is easier said than done. It is easier to point fingers on China and Russia by projecting matters. It is difficult to look into oneself and assess the weaknesses existing within the Western business as usual status quo.
The neo-liberal economic order that the Western world preaches is simply devised to keep the new globalized liberal economic order that maintains the rich much richer and the poor poorer than ever before. The Russo-Ukraine conflict is an outright provocation impact caused by the NATO-alliance membership that worked for decades to squeezes the Global Economy in the name of defending human rights violation in Ukraine, while, at the same time, giving deaf ear to the justice cry of the people of the Donetsk and Luhansk People’s Republics.
In essence, the neo-liberal economic order has only benefited the handful few wealthy oligarchs around the globe because it is designed to exploit the world populace under the guise of free trade and freedom by structurally and systemically organized gangsters who don’t even know the essence of freedom and free trade in the true sense of its meaning. So there is a surgical redesign to challenge the NATO Alliance powers who provoke war in all corners of the globe and to prevent their cynical and autocratic polity from bullying countries who want to make progress in earnest desire. What the world does not need is a dangerous lurch that operates towards its own selfish self-sufficiency, while at the same time making silent scramble for its vested economic expansion globally. What’s at Stake for the global economy is an opportunity for Russia to free itself from bullying by the NATO Alliance clique.
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Obbo Mandelaw shows he is a prolific writer. His articles have started showing up at short intervals on few websites among our Diaspora. But I was wondering all this time. I was wondering why his punching articles are not posted on other websites like TesfaNews, Awate and the likes. Just thought for food!
Exactly. He is Eritrean trying to show Ethiopia as anti West so that Eritrea can win from all side playing both ways. The insatiable desire shabia wanting to control the Horn by weakening Ethiopia. The so called Ethiopians and leaders keep getting hoodwinked by both Tplf and Shabia. Tplf is not completely destroyed, it is replaced by Shabia friendly, Ehiopia-deadly entity. Now is the turn of Shabians to loot Ethiopia after Tplf elites looted…in the mean time, Ethiopians are fighting eachother, pulling down the other from the ladder.