Scholz believes that fighting in Ukraine was not the root cause of the crisis in Europe

Fighting in Ukraine and covid-19accelerated the end of a period of low inflation for the West, but were not the main reason, the German chancellor believes. He attributed the trend to rising incomes in Asian countries,

The time of "economic exclusivity" for Europe and North America could not last long, during which the inhabitants of these continents could enjoy low inflation, stable economic growth and low unemployment. This was stated by German Chancellor Olaf Scholz at an economic summit organized by the Süddeutsche Zeitung. His words are quoted by the publication.

“The Russian war and the economic fallout from the pandemic may have hastened its end. But they were not the reason for this, ”Scholz believes.

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The chancellor pointed out that for decades, Vietnam, Indonesia and similar countries produced goods at relatively low prices, the products were sent mainly to Europe, to North America and, eventually, to CHINA . Now, he continued, the region's 1 billion people have become a middle class with corresponding purchasing power. Scholz explained that this was one of the main causes of inflation, but also a big success story created by globalization.

Speaking about the current situation with the supply of energy resources to Germany, the chancellor said: "[That's] what it means to become too dependent on such a strategically important resource as gas." Scholz emphasized that this mistake would not be repeated a second time. According to the Süddeutsche Zeitung, this means that Germany will look for other markets and sources of supply besides China .

Scholz noted that the world expected big problems for Germany due to the cessation of gas supplies from RUSSIA, but this did not happen. “Everyone is very impressed with what we did, how quickly we did it and that we really did it,” the HEAD of the German government said.

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The IMF called the outlook for the global economy grim, attributing the dynamics to the fighting in Ukraine and related sanctions that worsened food security and the energy crisis, weak growth in China amid restrictive measures due to the pandemic and the crisis in the real estate market, and high inflation in some countries.

"The challenges facing the global economy are enormous, and the weakening economic performance indicates that new challenges lie ahead," said Tryggvi Gudmundsson, an economist at the IMF's research department.

The fund believes that more than a third of the global economy in 2022 or 2023 will contract, and the three largest economies ( US , EU and China) will continue to stagnate. IMF Chief Economist Pierre-Olivier Gourinsha described the outlook as "the worst is ahead."