of national holiday, there was a cool it's been a difficult year for many here. last winter. devastating floods caused substantial damage. and some young curds who so to bitter life abroad, died of the cold weather on the bill or russian polish border. now the burdens of the cold season are being replaced by spring freshness. union between nature and culture is a message conveyed by these ancient rituals. ma'am, without the we're had al jazeera in our cross city, northern iraq. ah, hello again, i'm fully rateable. with the headlines on al jazeera, i knew curfew is being imposed in ukraine's capital from late monday to wednesday. ah, it follows another explosion at the sight of

a shopping center that was hit late on sunday, killing. at least 8 people rescue teams have been looking through the rubble to find survivors. kiva seen a number of attacks in the past week, but russia's advance on the city has slowed her deadline set by russia for ukrainian forces to surrender and marry a ball has passed. the cronyn government rejected moscow's offer to allow civilians to leave the city in exchange for soldiers laying down arms in avenues, a passenger plane carrying a 132 people has crashed in southern china. the china eastern, boeing 737800 jet, was on its way from coming to grand jaw. it came down in and the countryside near it was you in the crunchy region about 30 minutes before landing the plains impact . sponsor forest fire is encouraging. ping has ordered an investigation. the u. s. has determined the violence committed against me on mars. muslim rowena amounts to genocide and crimes against humanity. more than as 730000 romania fled. the western

kind said in 2017. when the military stage a brutal cracked down rise, groups have documented the burning of villages and killing of civilians. the attack against her henry was widespread and systematic, which is crucial for reaching a determination of crimes against humanity. the evidence also points to a clear incent behind these mass atrocities. the intent to destroy will hinder, in whole or in part. that intent has been corroborated by the accounts of soldiers who took part in the operation and later defected, such as one who said he was told by his commanding officer to and i quote, shoot at every sight of a person. and quote, bern villages rate and kill women. warders that he and his unit carried out more news in 30 minutes or china in the us sleep walking their way to war in the struggle over ukraine. here is the test for president joe biden.

whitman is really trying to do is rewrite the security architecture of your personal united states. you seriously go to walk and through gum at the same time, your weekly take on us politics and society. that's the bottom line. ah, i hello, i am sammy's a dan. this is counting the cost and al jazeera. you're look at the world of business and economics this week. the war in ukraine could severely impact the global economy and the i m. f also warns the consequences could be last thing. so which countries are most at risk this the world heading into a new financial crisis. also this week cut off from the international financial system. russia has turned to the chinese,

you want to survive sanctions. could other governments shift away from the u. s. dollar. this the greenback dominance in danger, crypto currency purchases and roubles have been rising and governments are worried . russia could evade sanctions using virtual coins. so is unregulated money, really a fix for russians financial woes? the war in ukraine is obviously hurting the economies of russia and its neighbor, with both countries expected to experience sharp recessions this year. but the economic consequences of the wall not only be felt by parties to the conflict, sweeping sanctions imposed on moscow and the soaring price of energy supplies, or they could inflict pain on other nations to. that's all of course, while the world economy is still recovering from that corona virus pandemic, the international monetary fun says the war could have

a severe impact on the global economy. it expects to carpets growth forecast globally. the i m f is also reduced its estimated global growth rate for 2022 to 4.4 percent in january. that's down from 4.9 percent last year. the most serious threat to the world economy is soaring, inflation, which is already at levels that haven't been seen in decades. that's mainly driven by the sharp rise in commodities and food prices. europe, with its heavy dependence on russian energy could be particularly hit. the ukraine war is expected to reduce your zone economic growth by as much as 2 percentage points. consumer prices in the 19 countries that use the euro zone currency hit record highs for 4 months in a row, reaching 5.8 percent in february. while the us is also at risk, it is expected to outperform european countries. in the conflict is also putting

a fresh strain on that overstretched global supply chain. pushing up the prices of many metals, both russia and ukraine export launcher, mounts, of steel, palladium, platinum, and nickel, among others. some common cause of idle factories due to a lack of components. and it is poor and developing nations that could suffer the most among the challenges ahead trade shocks a reduction in remittances and financial instability. but food security could be the most imminent threat. russia and ukraine of both main exporters of weights and parts of africa and the middle east could suffer severe shortages. well, to discuss all of this now i'm joined from new castle in the u. k. by klaus the stephan county is the chief. you're as an economist with pantheon macroeconomics, good to have you with us. so many experts. now we're comparing the current situation to the $900.00 seventy's energy crisis to the come out. so the lehman

brothers, do you see any of those similarities? well, i mean if we're very lucky, it could be a combination of both, right? because you have the specter for russian default that could be like lehman. and you certainly have the, the 1970 style supply side driven inflation. i mean, at the moment i would say we're more sort of towards the $900.00 seventies in the way that, you know, demanding the economy strong. and then we've had pretty much since cobit hit, we've had a string of supply side shops in the economy. the worn ukraine is now an additional supply shock rusher is one of the biggest, if not the biggest commodity corner in the world. so, but i mean, you can't, you just said, if i'm lucky, this could be both. that's huge. all we on the verge of another major global financial crisis, that's not our baseline, but certainly we are now dealing with events where things can get out of hand. very

quickly and where i think no one knows exactly what the ramifications will be. right. so a russian servant. busy default could, could obviously send other markets in a tailspin, we already have stressed financial markets. so we're certainly now in the, in a, in a, in a rather precarious situation. obviously, policies being tightened, although again, that could change. but at the moment, you know, policy support has been withdrawn because of high inflation. so we have a downside risk to growth. inflation is very high, which constrains policymakers at least in the near term. so yeah, now suddenly the risk of something adverse happening is suddenly rising. i would say, you mentioned inflation, then the i m f is expected to reduce its full cough. all we heading towards the perfect scenario for stagflation are we are in speculation now i think, i mean, if you look at full cost in general over the last 3 months,

and i would say this is going to continue for the next 3 months. also with reference to your comment now and i'm f inflation forecast will be ratcheted up because as you, as we economist start to factor in and quantify what, what the increasing commodity prices mean for inflation over the next sort of 6 months. if you will. inflation forecasts will have to go up, but growth forecasts will have to go down. so again, whether we're staring up into a global recession, we don't think that's of course, that's probably sort of miles deflation. but in so far as goes, the idea that inflation is growing up or growth is slowing. and you know, that's what's happening and you know, that is back felician. why was huge, will that mean for less developed countries for countries which are already struggling, jordan lebanon to new jersey in countries which subsidize the basics of life like electricity prices and so on. how they deal with this challenge, while economies like that are in a very tight spot now because they will be hit very hard by the kind of inflation we're seeing now. and food prices,

basic commodities. whereas developed economies are a little bit more shielded towards that. a because they're richer but, but also because their consumer price indices are not sensitive to, to wants these kinds of a price increases. so i would say that, you know, we do know them the consequences of effectively, if you will, shutting the russian economy. in this case, out of the global economy and the ramifications that have on, on different commodity most in an environment where it commodities and inflation already was kind of holding out. yeah. that, that could have quite significant consequences for, for some of the economy. you mentioned there was lead to lots of different depend on, on, on, on imported goods in, in some food stuff. of course, the economy is also produce a lot of their own stuff. but again, some of them are still dependent on, on inputs. and what about china? china is gross full costs. so going down it costs the least of energy going up, houses going to impact, shooting, pings, policies. while thing for china as

a sort of a balance. the situation are politically, of course, they will feel that the extent to which there is now a winding rift between the east and west. they feel that they might, will be able to, to become sort of a center point and in the east than in the eastern part of this they will trial because to, to politically exploit that situation. but economically, yeah, i mean, chinese growth is already on the pressure. they have a huge issue in the problem. second, which is affecting large parts of their economy at the moment. and so in that context, the fact that global growth now seems to be to, to be slowing in the context of, of, of an inflationary shock. and, and withdrawal of support in general, that certainly not a favor, certainly not a benefit for china, but generally in terms of the sort of you politics, i think maybe, you know, china will feel that they have opportunity to, to, to, to make, make a few points you mentioned developing, you mentioned, developed countries a moment ago as talk about europe,

the continent risking recession right now. guess they, it is. i mean that again, we don't think years and will fall recession, but we suddenly, we've recently found their full cross for the 2nd half the year reflecting high inflation, a hit to real incomes, less monetary policy support as a suddenly that's a risk. i mean, i would say that the, the upside in years when they start fiscal support, governments are after. busy covered in particular where of course they've, how the economy a lot. i think that will be quicker to, to rush to support economy here. you know, i think we will see direct subsidies for especially low income households in the context of, of protecting them from, from higher energy prices. i think we'll see big investments front lower than defense spending, which also, you know, has booster, that also boost u. p. growth in short term, we'll see big investments in energy infrastructure, which also could be front loaded. so i think the private sector suddenly now we'll probably face lower, but we have to grow a slower pace because inflation, cindy is going to sap some of that. and momentum,

but i think governments are going to try to offset that. of course, that's just going to give any more just gonna push even more on inflation. so in some sense, you know, if there's one thing i'm certain about is that inflation will continue go higher. everything else is sort of a little bit uncertain. what about the us? we can't talk, we can't not talk about the world's largest economy. how resilient is the us economy through all of this? some say, well, it would take, all price is going north of $200.00 a bow before the u. s. is pulled into refreshing. what do you think? while that's the good news, we think the us economy is relatively silly into this. you know, consumers have bought so stored up savings there a little bit further away from, from, from the situation in europe in general. so yes, they will import, obviously inflation by higher energy prices. but also remember, this is a really, really important point. the u. s. economy is different now because the u. s. economy has a big oil producing such itself shale, which means that as all prices go up, yes, it affects the u. s. consumer negatively, but they have a little savings, but it also boosts and energy cap act. so this old story in which, you know,

all prices go up and that immediately hits us growth is not necessarily the same anymore. we think that, you know, there, there could be even be a positive correlation between high oil prices and capex, investment and growth in the u. s. because you'll see all production spot pick up. so the us is resilient. that's very good news for the global economy because obviously that will become, i mean, if the u. s. economy does well, you know that already there means, but the global economy is on a relatively decent footing, even if you have witness elsewhere. all right, thanks so much and good talking to you. same. thank you for talking. the sanctions imposed by the west on russia are reviving an old debate on by the countries should hold dollar base central bank reserves. you see, the worry is they may lose access to those reserves when they need them, the most favor on fowl of the west, russian government has been at risk of defaulting on its debt. now,

because moscow doesn't have the money, actually, it does, but it can't access almost half. it's foreign reserves that you've been frozen by western capital's. russia says it's made $117000000.00 in interest payments. it owes to investors. but the money could be blocked by the us. the russian finance ministry says the nation would try to pay in roubles if this happens. moscow has a 30 day grace period in which the government should pay up. if it doesn't, that would constitute a default. it would be the 1st time the country failed to meet its financial obligation since the $917.00 bolshevik revolution. while russian banks and firms are increasingly turning to china's currency, the won as they faced isolation from the west land v t. b, bank is offering a chinese currency savings account with a maximum interest rate of 8 percent. others are also looking to start using

china's union pay system for credit cards off the visa, mastercard suspended operations in russia. the dollar has been the world's reserve currency since the bretton woods agreements. in 1944, russia held $100000000000.00 or 16 percent of its foreign reserves in us dollars. as of june 2021. another 32 percent was held in euro's and the country's been trying to reduce its holdings of us dollar denominated assets. in recent years, it sold off all of its us treasuries. in 2018. moscow also held over a $120000000000.00 worth of gold mold and its actual dollar denominated holdings. the commodity is effectively its primary holding, given the loss of access to dollars in euro's. the u on is the world's 5th largest reserve currency. central banks held at least $319000000000.00 us dollars worth of you on reserves. in the 3rd quarter of 2021. some economists say there's an effort

on the way to build an alternative financial system to that dominated by the us. they say that you are together with golden crypto currencies are likely to gain market share at the expense of western currencies. well, to discuss this, i'm joined now by timothy ash. he's a senior emerging market sovereign strand, just that blue by asset management joins us now from london. good heavy with us. so has the one become russia's new dollar, or is it becoming rushes new door? i don't buy i think what's interesting about this crisis is the unwillingness of, of the chinese to bankroll russia and to kind of help the ration circumvent sanctions. and we've seen that kind of across the board. i mean, you know, lots of criticism of sanctions from the west and there in effectiveness. but actually the financial sanctions that have been lobbied sofa and the fund,

the energy is not really been sanctioned. it's quite incredible that companies just do not want to transact with russia, including for energy because of the financial sanctions. the bottom line is the dollar is still king. alright, but regardless of how willing the chinese are or on not is distrust global described destruct growing in the us dollar. where does russia is not the 1st country that's been deprived access to its assets? we have, we've had iran, north korea, the tati bomb. and so on, i don't think so. i mean, you know, what's again notable is ofac the us treasury in the western sanctions machine is just so so powerful that what this shows is you may, you may find alternative ways to turn the fact, but in the end, western sanctions will find you in all these companies, the chinese bank, et cetera. the desperate to avoid been caught in secondary sanctions. so even if there are these authentic payment mechanisms, you know,

the ofac will find you eventually and you will be hit by the secondary sanction. so it doesn't really solve the underlying problem that you, you evidence to live with sanction because of its bad behavior. oh fuck is going after you and companies simply do not want to be caught in the firing line of oh fuck maybe we should focus a little bit now on the sanctions and just how unprecedented all the sanctions, no rush of a particular on its reserves, its foreign currency reserve. well, pretty remarkable. i mean, you know, know what to expect the cpr to be sanction a central bank. it's kind of unheard of. you know, when it came so quickly, i mean, i remember the week, you know, that week there was a research paper i think on the wednesday or thursday, highlighting that this was an option. there was intense negotiation, intense discussions. i know on the saturday in washington around it, and then it was done on the sunday. i mean, utterly remarkable, but devastating for russia. you know, russia thought it was in this, this untouchable position with 640000000000 of f x resist. it could withstand

anything, the west through it and then then oh fuck, you know, dropped the bombshell sanctioning the cb, our reserves and it put a huge weight of those reserves beyond their reach that got gold, i guess in, in the, in the vaults. they've got physical cache, there was obviously some, some swap lines with the chinese. but if the chinese, i think, are reluctant really to help them out very much again, this idea, you know, they don't want to be caught in secondary sanctions for helping out russia. so, you know, it's put, rush really incredibly difficult place on the bridge. brink of default, the financial markets of all totally collapse. it's extraordinary. you know, 95 percent loss in, in value across the board, equities bombs, and the currencies come under massive pressure. the russians, because of these sanctions, are a lot poorer today than they were a month and a half ago because the putins actions and notable i think there is they did not expected. you know, the phone is generally reduced exposure to russia. the biggest holders of russian

assets are since himself. they believe the rhetoric. let me tell you that despite that, despite the unprecedented nature of targeting a central bank, as you just explained for us, you don't think you don't agree with those. and let's just say this could be a turning point. this could be the birth of a new monetary order. i don't think so. you know, i mean, what are russians dashing for? what does the guy, what does the guy in the street moscow want to get his hands on? it doesn't want to get his hands on the wire. or, you know, he wants to get his hands on dollars. you know, the saw come maybe quit co counsel vegetable currencies use of currencies shot up on february 24th. well maybe, but you know, it's hard still to, to track transact and in anything you know significant with crypt. so i think oh fuck is coming off the crypt. so in the crypt, so he's going to be used to break sanctions crit, so we'll feel the weights of western financial sanctions as well. all right. what

about gold? you mentioned gold there. what's the possibility that the russian rouble becomes? well, even at least the fact so backed by gold now. well, you know, it doesn't really. it doesn't result the underlying problem that even if you come transact, even if it's legal to transact with russia and trade with russia, people do not want to, people do not want to take the ethical risk of transacting with, with coatings russia because what is done in ukraine, i think good talking to you. thanks so much timothy. my pleasure is another asset seen as an alternative medium of international exchange to the dollar is crypto currency. many governments are worried, the digital coin could provide a hidden brute for sanction russians to preserve their wealth, the virtual moneys unregulated, and it bypasses the international banking system, which of course is key to enforcing those sanctions. and the exchanges have come

under pressure to address the violation sons. they've resisted several calls to block, crush and uses as a whole ad are not yet legally obliged to do so. however, the major crypto currency exchange is like buying that say they will comply with sanctions and abide by the law. but there are thousands of small and less strict exchanges, which could step in and allow the transactions, the crypto currency research firm chi co says the average trade sizes bitcoin rubles transaction hit a 10 month high on february 24th in russia invaded ukraine. it's estimated more than 17000000 russians, all 12 percent of the population invest in crypto currency. russia ranked 18 with worldwide in terms of crypto currency adoption. it had the 3rd largest share of overseas transfers off the turkey and ukraine. russian entities that are under

sanctions have been accused of using ransomware attacks for revenues. the blocked chain tracking firm chan. allison says around 74 percent of that income all $400000000.00. when to entities that could be affiliated with russia last year. for joining me now is kind of part of the chief investment officer at credit link dot a . i an artificial intelligence enabled credit asset management company. she joins me from singapore. good, happy with her. so kyra, can crypto cards to provide an alternative to the us dollar? do you think at this point, decentralized crypto currencies definitely to want to not provide an opportunity for us dollar you or salary still backed by the world's most largest and powerful economy, as well as the trade and financial flows. crypto does not provide such backing at this point. having said that, a digitalized currencies and perhaps via that like keep though could replace usd to some extent and we had seen them some tests already rolled out in china. we're by

the p. b, o is see, has a huge digitalized to and that has been ejected into digital. well, that's the use case for such money. could make sense in the event of natural disaster or even with the current ukrainian prices. or can it go any distance in helping countries like russia to evade sanctions? i think it's difficult to use quick tell to rain sanctions because if a look at the size of fresh air economies forente by 1.7 trillion, whereas the entire market capitalization of group though, is 1.8 trillion. so crystal does not have the capacity or the death to allow russia to evade sanctions. and, but maybe maybe not all the sanctions. can it be helpful? i mean, august, as you pointed out, the volume does simply doesn't cover all of rushes needs, but can it go some length? to some extent, i would say yes. and if we look at righteous decision to allow crypto transactions earlier this year, although there was a lot of debate around pending crypt though, we could insinuate that perhaps that decision was influenced by the ukrainian

nation. and we can't rule out. maybe there was some sort of tip of the only gar, closer boots in that, and you may want to move some of your assets to keep the markets. what can governments do to is for activities with crypto currency they considered to be illegal. it's a bit tricky to monitor. i mean, of course, governments can deal what they always do, which is imposed more regulation b in the form of transaction reporting or transaction, or a taxation or even straight del, pending. but generally, the marketplace as we're crypto is trade that are already regulate that one way or the other. meaning that those marketplaces operate in heavy li, regulated jurisdictions such as the u. s. or the u, and the end points are regulates as meaning. if you want to do crypto transactions, you have to use a nature currency such as the euro, or the u. s. the, against it. or i, we saw a huge optic in crypto transactions on february, the 24th from russia. what are people using it for?

if, as you said, there is, it's kind of limited in terms of how far it can go to help with sanctions evasion. i think we could be seeing the 1st real use case for crypto with this side, ukrainian crisis as a lot of individuals, as the less entities are moving some of their money and some of their assets into crypto. so crypto could be proved to be a store of wealth at this point in time, although we can't really do any actual transactions in crypto yet. so this could trigger individuals just average savers increasingly looking towards crypto currency, not just sanctioned oligarchs. i would say so and looking at the comments coming from, let's say, coin base and some of the other markets they have said pretty, pretty straightforward. they are not gonna ban russian individuals doing transactions on their markets because they feel they can't penalize individuals and others agree with that. but having said that, limited access to the end points,

let's say the dollar and the euro definitely puts a bit of hold on entering crypto for regular russians or it's been great talking to you. thanks so much kyle. thank you so much. that's our show for this week, but remember, you can get in touch with our fire twitter. use the hash tag a j, c c. when you do or drop us in a mouth, county, the cost down to 0 dot net. it's our address is more for you online at al jazeera dot com slash ctc that can take you straight to on page, which has individual reports, links and entire episodes for you to catch up on that's it for this division of counting the cost. i'm sam is a ban from the whole team here. thanks for joining us. the news and al jazeera is next some journeys are tougher than others. but this road trip is even tougher

for the car and truck. it's dangerous with how to deal a world follows than the rock and truck drivers. indeed during their lives, just to make a living crash, they might break your mirror or even kill because approved is known for from a phonology 0 while giving birth in remote areas. one 0, one east makes the bright medics and piles, saving the lives of mothers. and then you build on out 0 with ah ah

ah. ready russia says it's forces hate a shopping center in ukraine's capital because it was storing rockets ah, i'm fully back table with this is al jazeera live from doha, with the latest developments in ukraine.