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Russia-Ukraine conflict ‘real threat’ to economic recovery: Sri Mulyani
The finance minister has raised concern over heightened geopolitical tension, particularly concerning Ukraine, that could disrupt the economic recovery and force countries to adjust their strategies.
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Armoured vehicles of NATO's rapid reaction force arrive at Borg Havn in Fredrikstad, Norway, on March 10, 2022, for a military exercise termed Cold Response 22. (AFP/Geir Olsen)
F
inance Minister Sri Mulyani Indrawati has raised concerns over heightened geopolitical tension, particularly concerning Ukraine, as well as several other factors that could disrupt the economic recovery.
Sri Mulyani, who served as managing director to the World Bank in the past, said on Wednesday that the Ukraine-Russia conflict created a very high degree of uncertainty as economic sanctions led to an extreme increase in commodity prices, as well as volatility in capital and financial markets.
Moreover, risks of supply chain disruption, inflation, unequal vaccination rates and impending global monetary tightening, among many other problems, persisted, she added.
“These are all going to be a very real threat for the economic recovery both in advanced as well as emerging countries,” Sri Mulyani said during a webinar held by credit agency Fitch Ratings.
Read also: Ukraine war may 'fundamentally alter' global economic, political order: IMF
The pandemic has triggered supply disruptions in many countries with prices of several key commodities surging to multiyear or even all-time highs.
Brent, the international benchmark for oil prices, briefly surpassed US$120 per barrel, double the assumption underlying Indonesia’s state budget for this year. Prices of nickel, coal and aluminum, as well as agricultural commodities such as wheat are among those rising the most.
