Russia, Ukraine conflict may impede global economic recovery

The rising oil price, the potential weakening of the rand against the United States dollar, and supply constraints around wheat, pose upside risks to food and headline inflation.

This is according Minister of Finance Enoch Godongwana who noted that the conflict between Russia and Ukraine carries with it significant risks for a world economy that is yet to fully recover from the shock of the COVID-19 pandemic.

“The longer the conflict lasts as well as the imposition of further sanctions could lead to widespread global inflation and impede global economic recovery,” Godongwana said on Wednesday.

He made these remarks in Parliament during the debate on the 2022 Fiscal Framework and Revenue Proposals.

“On the positive side, we expect that the rally in export commodity prices, stemming from supply concerns brought about by the conflict, will provide added support to the local mining sector and a possible windfall to revenue collections,” the Minister said.

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Photo: Unsplash

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