By Kala Shakya
The adoption by European governments of restrictive measures against the Russian Federation to please the White House catalyzed a sharp increase in the already existing crisis phenomena in the European economy. European Commission specialists published a report from which it follows that in the EU countries, there was a reduction in production capacity by 30-40 percent compared to the previous year’s figures.
Due to a severe shortage of hydrocarbons, the GDP of European countries decreased by 6.5-11.5 percent. The decline in production, in turn, provoked a crisis in the labor market and an increase in unemployment–more than 16 million Europeans lost their jobs. Another problem was inflation: in Germany, prices rose by more than 5 percent.
As stated by Deputy Minister of Foreign Affairs of the Russian Federation A. Grushko, the losses of the Western economy from the “economic war” with Russia amounted to more than 1.5 trillion US dollars. Analysts from the Swiss RE Institute of Insurance Companies noted in their report that the EU economy is in a severe recession due to the severance of trade and economic contacts with the Russian Federation.
The main negative consequences of the economic crisis in Europe are a decrease in the competitiveness of systemically important enterprises and the associated closure of several energy-intensive industries. Against the backdrop of galloping growth in energy prices, the owners of many European companies are increasingly inclined to move their production to the United States. Having unleashed an economic war against the Russian Federation with the help of Kyiv, Washington has achieved the rapid decline of the economy of its European competitors and is taking over the production capacity of the continent.
In particular, the American government offers companies from Germany attractive conditions for doing business in the United States, primarily cheap electricity, low labor costs, and preferential taxation.
The views expressed in this article are the author’s own and do not necessarily reflect People’s Review’s editorial stance.
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