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Ukraine trade disruptions and inflation weigh on firms and households, threatening to derail Europe's recovery and push many into poverty

The war in Ukraine risks upending Europe's economic recovery | EIB - June 14, 2022 |

According to a report published by the European Investment Bank, How bad is the Ukraine war for the European recovery? At the same time, our analyses show that rising inflation could push more Europeans under the poverty line.

The European Investment Bank Economics Department analysed the war's impact on the profitability of EU firms. We created a model with several assumptions:

Under our model, the share of EU firms losing money rises from the normal average of 8% to 15% in the year after the start of the invasion. The share of firms that risk defaulting on their debt also surges from 10% to 17% in the same period. Firms in sectors like transport, chemicals and pharmaceuticals, and food and agriculture suffer the most. Firms located in countries close to Ukraine, such as Poland, Latvia and Lithuania, are also hard hit, as are firms in Greece, Croatia and Spain.

When will citizens realize, the EU is part of the problem and has failed in previous years as well as today, to have policy in place before disaster strikes again.

Europeans concerned by cost of living crisis and expect additional EU measures | Jan 12, 2023 |

Corporations have no pain as banking, financial, energy suppliers, oil&gas monopolists, leading grocers are making extreme profits as salaried workers and pensioners suffer.


'Sapere aude'

by Oui (Oui) on Fri May 19th, 2023 at 07:18:25 PM EST
Inflation increases poverty unevenly, widening gaps across the EU

A new Science-for-Policy report "The effect of rising energy and consumer prices on household finances, poverty and social exclusion in the EU" by the Joint Research Centre (JRC) of the European Commission takes a detailed view on the matter, analysing the expenditure structure of European households across main product categories, such as food, energy, industrial goods and services. Using innovative measurement strategies, this study is also the first to assess the uneven effects of inflation on various indicators of poverty and deprivation.

The study confirms that the adverse social effects of inflation are significantly larger in many Central and Eastern European Member States, especially among disadvantaged and vulnerable groups. Low-income households in these countries may devote twice as high a share of their total budget to food and energy than their high-income peers or wealthier households in other Member States. Consequently, the increase in European households' living cost as a result of inflation between August 2021 and August 2022 was very uneven, and ranged between 7% and 30% across different countries and income segments. Poorer households are at a double disadvantage, which is deepening existing social gaps and inequalities across the EU.  

Capitalism and the Industrial Revolution erased Extreme Poverty across the Globe

Just be happy, it could be(come) much worse.

'Sapere aude'

by Oui (Oui) on Fri May 19th, 2023 at 07:19:51 PM EST
[ Parent ]
The market price of natural gas is at a low point equal to summer 2021, two years ago. The Dutch are paying the higher price of January/February 2022 ... a monopoly of pricing supported by the government which strikes up a 100% tax for consumers. Highway robbery and there is no end in sight. Lower income housing has the poorest insulation and are unable to pay the tripled and quadrupled energy costs ... so they cut on food and clothing for the families.

'Sapere aude'
by Oui (Oui) on Fri May 19th, 2023 at 07:21:41 PM EST
[ Parent ]
stern | [Hubertus] Heil also appeals to parents in the fight against labor shortages, 20 May
The President of the German Confederation of Skilled Crafts, Jörg Dittrich , recently encouraged young people to take up training in the trades - there are currently almost 40,000 training positions vacant.
Heil also announced, together with business, a strategy for recruiting workers in countries "where there are more young and well-educated people than the local labor market can absorb". To do this, he will travel to Brazil with Baerbock in June, he told the " NOZ ", because there the labor potential in the care sector is very large. In addition, there are agreements with Indonesia and Mexico.

Heil said the government would "proceed very sensitively so that we do not take away from any country the workers that it needs itself". The country of origin also benefits, for example from the commitment to on-site training.

archived Dean Baker, guest workers 2022, The Expanse, guest workers 2015, guest workers 2010
by Cat on Sun May 21st, 2023 at 02:09:14 AM EST
[ Parent ]


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