A severe winter can lead to social unrest in Europe. This warns Kristalina Georgieva, the head of the International Monetary Fund (IMF).
According to the Bulgarian, the Russian invasion of Ukraine has already caused “terrible” economic consequences. For example, due to the reduced gas supplies from Russia to Europe, there are concerns about possible shortages of natural gas in a severe winter. Furthermore, the war in Ukraine has fueled inflation, causing many households to face financial difficulties.
Fears of a recession have also been fueled. In her view, the current situation means that the European Central Bank (ECB) must carefully consider its fight against inflation. The ECB is raising interest rates to tackle inflation. At the same time, the need to keep the economy going must be taken into account, said the IMF head.
“There is certainly fear of a recession in some countries, or even if it’s not a recession, it could feel like a recession this winter,” Georgieva said. “And if Mother Nature decides not to cooperate and the winter is really harsh, it can lead to social unrest.”
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