Farzad Vajihi: What Did The Ukraine War Do To The European Economy?

But it is predicted that the impact of this crisis on the European economy has not yet fully manifested itself.

In a conversation with reporters, he stated that European policymakers hoped that 2023 would be the year when the continent would return to a new normal situation and inflation below 2%, and stated: In fact, the European economy is getting organized, but this "normal situation" "It's more chaotic than economists expected.

Vajihi stated: The Eurozone has been able to maintain its stability to a large extent due to the damage it experienced from Russia's attack on Ukraine and the energy crisis. For example, the price of gas is now cheaper than on the night of the start of the conflict and has dropped from its peak in the summer season.

This economic activist believes that the European governments, which were initially afraid of the winter ahead of them, even filled their own reservoirs when the weather warmed up. Also, the inflation of this region, which reached 10.6% in October, is decreasing and has now reached 9.2%.

He said: Contrary to some predictions, the industry of this region did not collapse due to the increase in fuel prices. In Germany, intensive industries have reduced their production by about a fifth since the start of the war as imports replaced domestic production. But production at the end of 2022 has fallen by only 3%, and industrialists are now as optimistic as they were in the pre-corona era.

Although some of the world's leading economists announced that Europe has entered economic recession, Vajihi stressed that according to the reports of the first quarter of this year, Europe will not suffer economic decline. Although American inflation has decreased more than Europe, but what the reports show, Europe is currently facing stable inflation. Stability in the European economy allows people to keep their jobs. The number of people working in the European Union bloc rose again in the last quarter of 2022, with unemployment at its lowest level since the introduction of the euro in 1999. Also, various companies have shown a desire to hire more employees in surveys.

He added: The consumer price index, except for energy and food, increased by 7% in the year ending in January. The cost of services has also taken a steep upward slope, which can cause a further increase in prices.

In the end, Farzad Vajihi, director of Aron Group Broker, said: "The euro zone may have escaped recession so far, but stable inflation, high interest rates and a weak economy do not have pleasant prospects." The International Monetary Fund forecasts a growth of 0.7% in 2023 for the European economy. But the Commission's forecast is 0.9 percent, which may be considered optimistic. America is also facing such stable inflation, and the reopening of China after Corona has not helped much to improve the economic situation in Europe, and on the contrary, it may increase the percentage of retail sales, because when the economy is good and the global circulation is good, retail sales increase. finds, because more purchases are made by human societies.