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Ukrainian Invasion Adds to Chaos for Global Supply Chains

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Ukrainian Invasion Adds to Chaos for Global Supply Chains

Russia’s military incursion is severing key supply chains and setting off a scramble among global companies to comply with new sanctions.

The New York Times,

5 min read
3 take-aways
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What's inside?

Rising transportation costs are only the beginning of the global economic repercussions of the Ukraine crisis. 

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Besides triggering a humanitarian catastrophe, Russia’s invasion of Ukraine and the resulting Western sanctions significantly affect the global economy. The crisis puts additional strains on the shipping industry, which is still dealing with the backlogs and surging transportation costs the COVID-19 pandemic triggered. Russia’s curtailed ability to trade already generates consequences across the global economy, resulting in social and economic woes that will likely worsen as the conflict continues. Ana Swanson of The New York Times offers an overview of how the Ukraine crisis affects global trade.

Summary

The conflict in Ukraine exacerbates supply chain disruptions caused by the COVID-19 pandemic.

When the Ukraine invasion began, the global supply chain was already strained. Consequences of the two-year pandemic – including congested ports at US entry points, high international shipping costs and partial factory closures in Asia – continue to hamper international trade. The invasion of Ukraine adds to these woes. Rising energy costs contribute to even higher shipping costs.

The ban on flights in Russian airspace force air shipments between Asia and Europe to fly longer routes, which further increases fuel costs and causes shipping delays. Further impediments to global trade include the...

About the Author

Ana Swanson covers trade and international economics for The New York Times.

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