As Russia’s war against Ukraine rages on, new ways of doing business – and surviving – are forged

“The idea which we Europeans have been accustomed to, and which we took for granted – that of peace between nations – has been shattered,” says financial advisor Paul Bonello of Russia’s war against Ukraine, which as entered its fifth month.

He adds that the war has created a seismic shift, “particularly in foreign policy”.

This is because the Russian invasion of Ukraine is not “some ‘distant’ war”, he elaborates. “It is happening on our doorstep. It has made European nations realise that Russia will always be Russia, an expansionist autocratic state that can, and will, from time to time, become a threat to the Western concept of freedom and democracy.” He credits this realisation to shifts in the foreign policy of countries such as Germany, which have, typically, stayed out of military conflicts – in arming and financing Ukraine’s military machine yet that have now become embroiled – and the decision by Finland and Sweden to submit their application to join NATO.

These moves, he says, could never have been predicted. “In fact, this cruel invasion of Ukraine by Russia has had two salutary effects: one is that EU citizens now realise that peace is a struggle one has to work for. Perhaps, now, people realise that the EU – originally the European Coal and Steel Community – was primarily formed as an alliance of countries intent on achieving lasting peace in a Europe which was, previously, continuously at war, and to do so through economic progress,” he says.

In this light, and taking into account the defiance and Ukraine’s refusal to capitulate, as well as the motivation of the nation’s military and civilians, Putin’s incursion, was a “miscalculation of Ukrainian resistance and of the West’s resolve to unite in defence of aggression.”

Zeroing in on the economic repercussions, Mr Bonello says that the war has affected economy and trade – across the globe – in a substantial way, but he believes the impact will only be temporary, and this is due to the realisation by political leaders and economic analysts that the conflict will be long, and therefore, new ways of doing business – and of surviving – are necessary.

“Hence, countries are changing their trading patterns permanently. Yes, there has been a major short supply of oil and gas, as well as agricultural products such as wheat, since both Russia’s and Ukraine’s export markets are blocked – the former by sanctions, the second by logistics. But, the major economies will adjust with new suppliers, new export markets, new energy sources and so on,” he explains.

This is why, he continues, “most economists agree that the sudden increase in inflation – caused by supply shortages rather than excessive consumer demand – will probably become milder with the passage of time. Russia’s economy, however, will suffer permanently: once more their economy has become central and ‘self-sufficient’ – common people will have to be content with purchasing local produce for all their requirements from food to cars. The freedom which they had found with Gorbachev and their taste of Western freedom and consumer choice has abruptly come to an end,” he asserts.

Elaborating on the impact here in Malta, Mr Bonello admits to feeling “baffled”, since “it appears to me that very few have realised the significance of this major development in geo[1]politics.” He underscores the moral necessity to think beyond what we can obtain from the crisis towards what we can contribute to a country to a lasting peace where one is not threatened by his militarily more powerful neighbour.

This is an extract of a wider feature on the war in Ukraine carried in the summer 2022 edition of Business Now magazine, the sister brand to BusinessNow.mt