Though many forces want to turn Ukraine into another Afghanistan for Russia, any misadventure in this area means nothing but the outbreak of the World War III. The concept of ‘One Global World’ has now received a major setback. The very values of freedom of speech, independent media and human rights that were promoted during the last 100 years are now being gradually reversed. Trade blocs are now military blocs.

True impact of recent events will be felt towards the end of the year. Sanctions on Russia mean sanctions on the globe. Rising commodity prices and falling stock markets constitute a strong case in point.

The safe haven currencies’ concept is failing with each passing moment. Many countries are now facing the question whether they continue to maintain their all reserves in USD denomination. Gold prices are increasing by the day. New payment systems are being added. All factors pointing towards a grim battle for dominance in trade and reduced reliance on USD.

The biggest causality of current issues will be free flow of capital. It is quite likely that interdependence of countries for trade will soon be challenged. It is also possible that governments will soon go for food securities. Third World countries will fight for their survival. Changing weather patterns are already having an impact on crops. That the Ukraine-Russia conflict constitutes a profound challenge to the entire world is a fact. I am sure that common sense will prevail in the end.

Farhan A. Chaudhri (A senior banker)

Copyright Business Recorder, 2022