The other war. From starvation to regime overthrow. George Friedman: We have two wars – the war from Ukraine and the economic war with Russia. I expect the economic war with Russia to decide in the end

How seriously affected is the goods market at a worldwide level by the war from Ukraine and by the sanctions imposed to Russia? Will the sanctions lead to the capitulation of Russia? “The economic war with Russia has created some instability over the world, on many markets, including the goods market. And this is the war that will decide in the end what will happen next,” says the famous analyst, George Friedman. The founder of Geopolitical Futures Organization together with the geopolitical analyst Antonia Colibășanu and the director of analysis Allison Fedirka drew, in a debate, the attention over the chain of effects, out of which social riots can be the last ring, as it had previously happened in history. The discussion took place in the GPFClub, where the experts of the company talk to their premium customers.

13 Iunie 2022, 14:49 (actualizat 13 Iunie 2022, 14:54) Știrile TVR |
George Friedman / FOTO: www.facebook.com/GeorgeFriedmanGPF

The recession is a financial event, a system in which the value of money fluctuates, and which is managed through the banking system. (…) The depression appears when the physical system of production and distribution fall. And they are much more difficult to be repaired. You cannot just through away money. The problem is mechanical and difficult. We escaped depression after COVID, we had supply chain crashes, but without massive consequences regarding food and other products. (...)

The war from Ukraine is different. This is because we have two wars: the fight from Ukraine which I start to believe is less important and the economic war with Russia. The economic war with Russia has created some instability over the world, on many markets, including the goods market. And this is the war that will decide in the end what will happen next. If it is successful, Russians will have to somewhat capitulate. If it isn’t successful, Russians will gain space to fight” said George Friedman.

"We are not talking only about deficiencies and disruptions in the supply chains, we are talking about restructuring global commerce and investments. The food supply chain is at the heart of this” declares the director of operations of Geopolitical Futures, Antonia Colibășanu. Thus, the discussion started from a destruction on 3 fields: financial, commercial, and energetic.

When the front line marks the limit of food reserves as well

According to George Friedman, the question begins to arise as to whether the syncopes in the system of production and consumption are temporary or whether a general fall is foreshadowed.

The maps we see daily with the evolution of the situation on the ground are at the same time maps of food. The war has a direct impact on the future grain harvest.

“The major wheat production is concentrated in eastern and southeastern Ukraine. These are also the areas where we see most of the fighting” says Allison Fedirka, director of analysis of Geopolitical Futures, indicating the red zones, controlled by Russians. "As the front-line advances, the ground is destroyed," she added. "We have a big question mark over how long Ukraine will be able to continue to produce." Underlines Fedirka.

From war to starvation, from starvation to instability and regime overthrow

The food supply chain has been at the center of brutal changes affecting the world since February 24, the day of the Russian invasion of Ukraine.

"Energy is actually at the basic level of production when it comes to food. You need energy to fertilize, you need energy to produce in agriculture, and you need energy to transport food from one place to another.", explained Antonia Colibășanu, geopolitical analyst.

Moreover, in addition to the increase in fertilizer prices, an increase in pesticide prices is expected. However, fertilizers are most often mentioned because they are related to the beginning of the production season.

Due to declining grain exports from Ukraine, prices are rising. It has also reached the point where many countries have imposed restrictions on their own food exports. According to Geopolitical Futures, at least 35 states have imposed such restrictions.

So even less food reaches the countries that need it most. The worst affected area is North Africa.

The lack of food can generate regime overthrows, the experts of Geopolitical Futures warn us.

"This is why we care about food supply. The explanation is that, when people become angry, they tend to rise, to protest, to create instability in their countries, and of course, the instability from these countries can have a domino effect over the behaviour towards others or government overthrows” said Allison Fedirka.

"In some of these countries, they are so used to starvation that no political consequence will exist. At least not a major one. In the advanced industrialized countries, the simple disruption of the normal lifestyle can generate a variety (of effects e.n.), it depends on the experience of every country. A much lower level of deprivation in the United States could lead to more destabilization than in Bolivia” exemplified George Friedman.

"Starvation can have (...) very odd results. (...) The lack of fundamental goods in USA or Europe can have extraordinary effects", says Friedman.

"Looking at the war from Ukraine that has an impact over the availability of goods (...) and this is like an ever-ticking clock – how long can it take to have an impact on the international economy as well? The war from Vietnam lasted for 7 years, it shouldn’t have lasted so much, but it did, without any impact over the global economy. And others had an impact over the American economy, but not so critical. However, this war is different, and we must look at it differently. (...) When everyone starts looking for baby milk powder and can't find it, as is the case in the United States, when they start looking for regular food, they can replace it for a while, but later you will have a problem," the famous analyst added.

 

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