Impact of War in Ukraine on UK's Economy: Short and Long Term Effects

Contemporary
Business Environment

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................3
Using the circular flow of income, explain the main impacts of the ongoing war in Ukraine on
the UK’s economy? Consider both the short-term and long-term economic impacts. ..............4
What economic recommendations if any can be provided to the government of UK to remedy
any negative effects of the war in Ukraine on the UK’s economy?............................................4
What economic recommendations if any can be provided to the Central Bank of UK to
remedy any negative effects of the war in Ukraine on the UK’s economy?...............................4
CONCLUSION ...............................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
Businesses are required to negotiate their modes of operation within a wide ranging range of
appropriate surroundings. The ways in which the company interacts with its surroundings
determine how successful it is. A company that does not respond to the relevant changes in the
environment on a consistent basis is hopeless to gradualism and forgetfulness. In order to for a
business to be viable, it must not only be aware of various environmental factors but also respect
and respond to them (Hamilton, and Webster, 2018). Modern businesses are becoming
increasingly complex and dynamic. In order to deal with the rapidly expanding business in the
economy, politics, and private life, managing these organizations frequently necessitates
innovative solutions. Analyzing the complicated relationships that exist between the components
of a system can address this issue. As a result, when developing a strategy or making a decision,
numerous elements and their interdependencies must be considered. In this report will cover the
issues that company faces while war among the Ukraine on the UK economy. After that it will
explain the short and long term economic impacts. Further it will recommendation which helps
in coping up from the negative impact of the war in Ukraine on UK economy.
MAIN BODY
By the year 2022, the growing geopolitical uncertainty caused by the Russian invasion of
Ukraine will have a negative impact on global economic conditions. The Russia-Ukraine conflict
is having an enormous impact on the global supply chain, threatening the flow of goods, causing
dramatic price reductions and commodity shortages, and causing catastrophic food shortages
worldwide. The model predicts that these effects will have a significant impact on GDP and
inflation, exacerbate the policy-business trade-off that faces central banks world wide. These
effects do not appear to be significant enough to halt the global recovery from the pandemic. As
a result, the conflict's future is extremely uncertain, and unforeseen advancements in the conflict
could lead to changes in the region's uncertainty and worsen its economic effects. There are no
nations that benefit from war (Liu, 2021). A nation will never be able to exist on its own, just as
no person can live alone. It is possible to say that this world is a family, and each nation is a part
of it. Everyone hopes that everyone will run the country in a way that fosters love and harmony
among themselves. The global economy, which has yet to fully recover from the effects of the