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The pipeline has been shut for three days for maintenance and will not reopen unless sanctions are lifted.

"Pumping problems arose because of sanctions imposed against our country and against a number of companies by Western states, including Germany and the UK,” said Kremlin spokesman Dmitry Peskov.

Gas prices surged on Monday 5th September over pressing concerns around energy supplies. The Dutch month-ahead wholesale gas price, which is considered a benchmark for Europe, rose 30% in early trading on Monday, whilst prices in the UK were up as much as 35%. A German government spokesperson commented that the latest gas price surge was part of Putin's plan.

The European Union's statistics office, Eurostat, reported that consumer prices in the 19 countries using the euro rose 0.1% month-on-month in July for an 8.9% year-on-year increase. This is the highest rise since the euro was created in 1999.

Eurostat said that of the total, 4.02 percentage points came from more expensive energy, which is up due to the Russia-Ukraine war. 2.08 percentage points stem from higher food, alcohol and tobacco costs.

Last month, the European Central Bank launched a tightening cycle following years of ultra-loose monetary policy. However, the cost of services still increased by 3.7% year-on-year in July, contributing 1.6 percentage points to the final outcome.

It was recently reported that UK inflation has now exceeded 10%, prompting thousands to sign a petition urging the government to introduce an emergency budget.



According to data from the Office for National Statistics (ONS), the UK imported £206 million of goods from Russia in May, a figure down 16% from the £244 million imported in April and 90% lower than in February.  

The sanctions also saw crude oil imports hit £0 in May from $59 million in April and £99 million in February. 

Following Russia’s unprovoked invasion of Ukraine in late February, Europe, the US, and other nations have imposed a series of tough sanctions against Moscow and this has severely impacted the Russian economy. 

However, many European countries are still struggling to boycott Russian fossil fuels, particularly gas, as this makes up a major proportion of the energy supply for many. 

Back in March, German economic and energy minister Robert Habeck warned, “If we flip a switch immediately, there will be supply shortages, even supply stops in Germany.”


Key to my approach to markets is that they require political stability to thrive – hence the most remunerative markets tend to be found within the most stable nations. They tend to have robust and enforceable legal systems, solid financial infrastructure and a culture enabling transactions and risk-taking. That’s the key to understanding the fundamental strength of the City of London – centuries of stability.

All around the world, we are now seeing a rise in instabilities – triggered by supply chain breakdowns, the supply shocks in Energy and Food, and now wage demands. Nations are struggling with inflation, rising interest rates, higher debt service costs on borrowing, rising bond yields, currency weakness, and how to address multiple vectors of financial instability as they try to hold their financial sovereignty together.

It’s occurring at a time when we seem to have reached the lowest common denominator in the political cycle. That’s a critical problem – voters need leadership in crisis, and they can easily be fooled by populists.

Confidence in a nation’s political direction and leadership is one of the key components of the Virtuous Sovereign Trinity, my simple way of explaining how Confidence in a country, the value of its Currency, and the Stability of its bond market are closely linked. When they are strong – they can be very strong. Strong economies rise to the top.

But, if any one of the Trinity’s legs were to fracture, then the whole edifice could come tumbling down. Which is why we should be concerned sterling is down over 10% this year. It strongly suggests global investors have issues with the UK.

Key to my approach to markets is that they require political stability to thrive – hence the most remunerative markets tend to be found within the most stable nations.

The UK is a good example of what might go wrong. If confidence wobbles in the government’s ability to handle the multiple economic crises now upon us, particularly the rising tide of industrial unrest as workers demand higher salaries to cope with inflation or servicing the nation’s debt, then the UK’s currency and bond markets could come under massive pressure. Investors will demand a higher interest rate to account for the increasing risk inherent from investing in the UK, while the currency could tumble as investors sell gilts to buy less vulnerable more stable nations.

At least the UK is financially sovereign. We control our own currency. Sterling may weaken, but we can always print more to repay debt… Except that would probably cause a global run on sterling as confidence in the UK would further tumble. If the currency leg were to fracture, interest rates would have to rise, wobbling confidence further.

The Virtuous Sovereign Trinity sounds stable, but experience shows it can quickly turn chaotic if issues are not swiftly addressed.

Clearly, the UK has some current confidence “issues” regarding the incumbent political leadership. The growing perception that Boris is a “lame duck” magnifies internationally held concerns about how his government has failed to seize the opportunities (such as they were) from Brexit, doubts about energy and food security, and the apparent dither in policies are all perceived as reasons for sterling weakness and are another reason bond yields are rising as global investors exit.

While the UK’s debt quantum should be manageable – Italy is somewhat different. As part of the Euro, Italy is no longer financially sovereign. It has rules on Debt/GDP to observe (and ignore). But effectively Italy borrows in a collective currency it has no real control over. It has to plead with the ECB for the right to borrow money and will rely on the ECB to announce special measures to make sure its debt costs don’t turn astronomical. Without the ECB, Italy would be heading straight for a debt crisis.

That’s why ECB head Christine Lagarde is desperately trying to guide the ECB towards the establishment of anti-fragmentation policies to stop Italian debt instability leading to a renewed European sovereign debt crisis. Fragmentation means Italian bond spreads widening to Germany – the European sovereign benchmark. It’s a political issue because Lagarde is no central banker, but a politician sent in to lead the ECB to the inevitable compromise that rich German workers will pay Italians’ pensions.

In the USA there is an even larger political impasse developing. The US Supreme Court’s decision – by 4 old men and one catholic woman appointed by Trump – to deny women the right to control their bodies by undoing abortion rights highlights the increasingly polarized nature of US politics. Republicans, and their fellow travellers on the religious right, are delighted. Democrats are appalled.

US politics simply doesn’t work. All efforts by Biden to pass critical infrastructure spending have been stymied. There is zero agreement between the parties – each has destroying the other at the top of its to-do list, rather than rebuilding the economy. The result is increasing doubts on the dollar. It’s a battle the Republicans are winning by dint of managing to stuff the Supreme Court with its appointees. It’s no basis for democracy or market stability.

At the moment the dollar is the go-to currency, and treasuries are the ultimate safe haven. It could change. The world’s attitude to the US is evolving. The West may be united on Ukraine, but global support is noticeably lacking. 35 nations representing 55% of the global population abstained from voting against Russia at the UN. The Middle East and India see Ukraine as a European problem and a crisis as much of America’s making. As the West lectures the Taliban on schooling girls, the Republican party has moved the US closer to a dystopian version of The Handmaid’s Tale of gender subjugation.

As the World increasingly rejects America, then America will reject the rest of the World. Time is limited. The Republican Administration, run by Trump, or kowtowing to him, will likely pull the US from NATO and isolate itself. That’s going to become increasingly clear over the next few years. The dollar, the primacy of Treasuries… will leave a massive hole at the centre of the global trading economy.

It will be particularly tough for Europe. As we seek alternative energy sources, what happens when Trump 2.1 proves as pernicious as Putin and shuts off supplies?

The supreme court decision was clearly timed to come at the Nadir of this US political cycle – a weak president likely to lose the mid-terms in November – when the Roe vs Wade news will be off the front pages. It means the damage to the Republicans in the Mid-Term Elections could be limited – they will still make the US essentially ungovernable for the next 3 years.

If the US was a corporate, it would be a massive fail on corporate governance. But it’s not. It’s the current dominant global economy and currency. Politics and markets can’t be ignored.

Joining other major bank CEOs warning about global economic health, Fraser said that conversations during her world tour with stops in Asia, Europe, and the Middle East focused predominantly on “the three Rs”. 

"It's rates, it's Russia and it's recession," Fraser said at an investor conference in New York, warning that, in Europe, "the energy side was really having an impact on a number of companies in certain industries that are not even competitive right now."

"Because of the cost of electricity and the cost of energy, some of them are shutting down operations. So Europe definitely felt more likely to be heading into a recession than you see in the US," Fraser added.

The Citigroup CEO said that, in the US, interest rates are a greater concern than a recession. 

"It's certainly not our base case that it will be, but it's not easy to avoid either.”


Worsening global supply chain disruption is one of the conflict’s most significant consequences for businesses. In fact, Moody’s has highlighted that the war in Ukraine has replaced COVID-19 as the most considerable risk confronting the global supply chain. Of course, this comes as no great surprise, considering that approximately 15,000 China-Europe freight train trips were made in 2021, with many of these trade routes running across Russia and Ukraine. 

The disruption and rerouting of these trade routes due to the war is leading to further chaos across the supply chain and this has massive implications for SMEs, which face tremendous supply chain challenges. Even before the war, almost two-thirds of UK SME manufacturers had already reported concerns that material supply shortage could impede their output. The conflict is serving to exacerbate these problems.

The need for supply chain redesign imminent

Tackling crippling supply chain challenges would require businesses to shift away from existing models that relied on lean inventories and just-in-time delivery. With this in mind, many companies are now looking at ways to build up and store inventory reserves to prepare for supply chain shocks in the future. The difficulty, however, is that while this mitigates the impact of disruptions to future production and improves supply chain resilience, it ties up valuable working capital. Moreover, these "safety stocks" can also risk obsolescence due to technological advancements or changing customer demands, which leads to precious resources, waste, and lost revenue, if not managed carefully. 

At the same time, larger organisations have begun to scrutinise their entire network of suppliers to identify potential critical bottlenecks. With the ongoing supply chain disruption, excessive reliance on specialist suppliers or suppliers in the exact locations created a knock-on effect that delayed production down the line. Unfortunately, this puts everyone in the supply chain at greater risk and consequently, these organisations are expected to diversify their network to strengthen their resilience.

The push for diversification presents both an opportunity and a challenge for SMEs.

While more MNCs are expected to decentralise their supply network to mitigate risk exposure, they will also likely set stringent criteria for SMEs to demonstrate strong business and financial fundamentals.

The need for liquidity and risk mitigation through trade financing

To assemble a well-stocked inventory and devise a strategy to sustain production during future disruptions, SMEs need to identify and unlock alternative funding sources to ensure resilient cash flows

Many are already suffering from high debt burdens due to the pandemic and, in addition, the war and the subsequent sanctions have caused soaring inflation and surging energy prices, exacerbating their financial challenges. This dramatically raises SMEs’ operational costs and worsens their liquidity crunch. 

The uncertainty of macroeconomic recovery due to the war in Ukraine has also led to investors remaining cautious and banks focusing their funding on more conservative, established relationships. 

The "flight to quality" has left many worthy businesses — particularly SMEs — with limited options for trade finance. Smaller companies are often unable to prove creditworthiness or show additional collateral required by banks to mitigate the risk of SME lending under the traditional banking system. Some may also resort to self-financing, which results in more significant cash flow challenges in a sustained crisis.

A recent survey Asian Development Bank (ADB) showed the global trade finance gap grew to an all-time high of US$1.7 trillion in 2020, a 15% increase from 2018. Despite the universal acknowledgement that SMEs are vital to economic prosperity and macroeconomic growth, they accounted for 40% of rejected trade finance requests. Without the short-term liquidity and risk mitigation provided by trade finance, buyers and sellers will be impeded in their efforts to tap into traded goods for recovery. 

One option SMEs can consider is a non-recourse approach for off-balance-sheet financing, which essentially takes away the burden of loans. Suppliers can leverage platforms, such as Incomlend's global invoice financing marketplace, to ask for early payment from their customers via a third-party financier. In effect, they are selling their invoice and obtaining finance without risk. It reduces the risk of late payments and bad debts – an option that would not be offered with traditional banking.

Buyers can also tap similar options by allowing buyers to optimise their cash conversion cycle and extend their payables due date to suppliers, freeing up working capital that would otherwise be trapped in the supply chain. 

Unlike commercial lending or dynamic discounting, such off-balance-sheet financing options allow SMEs to keep a low debt-to-equity ratio and preserve their borrowing capacity while diversifying their access to funding and reducing their reliance on traditional financial institutions. It also helps them mitigate the risk of their receivables and build up economic resilience in these volatile times. 

Hunkering down for uncertain times

Without an end to the conflict in Ukraine, many SMEs will need to build up their resilience and prepare themselves for prolonged volatility. During this period, SMEs in Europe will be challenged to transform their supply chain to buffer against ongoing disruptions and increase their working capital to remain fiscally agile in these uncertain times. These drivers will increase interest in receivables as an asset class among the SME community. They will look for more ways to manage risk in their trade processes and improve liquidity to weather through the storm.   

About the author: Morgan Terigi is CEO and Co-Founder of Incomlend.

With a total valuation of more than $9 trillion, the European real estate market has caught the eye of new and seasoned investors alike. When you think of real estate investments in Europe, prominent cities, such as Berlin, London, and Paris, instantly come to mind. However, foreign investors have plenty of opportunities to reap the benefits of emerging markets in Central and East European countries. Despite the economic turmoil of 2020, the region recorded a total of €9.7 billion in real estate investment transactions. That figure is projected to skyrocket in the coming years.

We’ll dive deeper into the hottest new European markets for foreign real estate investments in the following sections. Let’s get started.

1. Georgia (Tbilisi)

Georgia’s real estate sector has witnessed significant growth over the last few years. The development of state-of-the-art projects, such as David Kezerashvili’s Vake Plaza in Tbilisi, propels the industry further.

Situated close to the city centre, Vake is an upscale neighbourhood in Tbilisi known for its fine dining restaurants and tranquil ambience. It’s also the area with the highest density of ex-pats, making it ideal for investors from foreign countries.

The university district of Saburtalo is another neighbourhood that’s grabbing the attention of investors. It’s a more affordable alternative to the sky-high real estate prices in Vake. However, it is essential to pay attention to investment advice by David Kezerashvili. According to the real estate developer, investor, and former Defence Minister of Georgia, the country’s real estate sector is prone to government interference.

The absence of a proper legal framework makes it difficult for developers to gain complete control of their projects. Also, that leads to an abundance of conflicting information at local, state, and federal governments.

Kezerashvili believes that the market presents an ocean of opportunities to foreign investors despite these limitations. But he advises investors to be prepared to navigate through a bureaucratic system plagued with remnants of Soviet policies.

2. Poland (Warsaw)

Poland is one of the top contenders as a relatively stable and safe market for real estate investments. In 2020, the country dominated the CEE real estate investment market with total recorded transactions worth €5.6 billion. It’s the third-best result in Poland’s history. However, it’s worth noting that buyers and investors are prioritizing the industrial sector over other markets, such as housing. The retail industry has seen a surge of alternative assets, such as open-air shopping centres and retail parks. It’s understandable considering the changing shopping preferences of consumers due to the pandemic.

There’s also been a rise in the demand for high-rises and luxury residential properties in Warsaw. Warsaw's thriving business sector and relative political stability have turned it into a lucrative market for investors.

According to a recent report by PwC, there’s also an increased interest in acquiring assets that can be repurposed and repositioned. It’ll help investors pivot when market forces change due to economic downturns, political conflicts, etc.

3. Hungary (Budapest)

Sustained economic growth and low unemployment rates have led Hungary’s capital to become the fastest-growing housing market globally. The city has particularly benefited from foreign companies opening new offices and luring potential investors.

According to Adam Ilkovits, CEO of a leading brokerage firm in Budapest, seasoned investors choose to buy properties on the outskirts of the business district. These areas offer more potential for appreciation, thus resulting in higher resale values. If you’re looking to invest in the housing market right now, Hungary is one of the most rewarding markets.

4. Czech Republic (Prague)

Economic growth in Czech Republic’s capital has created a class of thriving high-net-worth individuals with an eye for high-end properties. The so-called ‘nouveau riche’ focus on buying luxury properties that enhance their social status. If you’re looking to venture into the luxury housing market, Prague would be a great place to start. Experts believe that the growth of the premium housing segment will continue in the coming years.

The Way Forward

While the CEE real estate market is showing signs of growth, it’s expected to suffer minor blows due to the Russian invasion of Ukraine. The increased cost of construction materials combined with supply chain disruptions will escalate property prices.

Irrespective of the market you choose, you must have a clear idea of the underlying risks of foreign real estate investments. Also, you should have a deep understanding of government policies and legal regulations in that specific market.

When asked whether there would be a European ban on oil imports from Russia, Johnson replied, "There are different dependencies in different countries, and we have to be mindful of that, and you can't simply close down the use of oil and gas overnight even from Russia.”

"We can go fast in the UK...what we need to do is to make sure we are all moving the same direction... and that we accelerate that move and I think that's what you are going to see."

The UK prime minister also said that the government must ensure a substitute supply, though warned that impacts to the UK population can be expected. 

Johnson’s announcement follows on from previous remarks from Europe minister James Cleverly who said that the UK will consider banning Russian oil imports as the US moves to do so.

Angelica Donati, Head of Business Development at Donati S.p.A, takes a look at inflation post-pandemic.

Although price rises vary widely across the zone, inflation in the eurozone is now 4.1%, a 13-year high. According to the European Commission's estimates, Europe’s inflation is expected to continue to record-high levels in the first half of 2022 and will last at least until the end of the year. As per other sources, the eurozone inflation is transitory and forecasts inflation will slow to 2% in 2022, but this remains to be seen.

However, the issue of global post-pandemic inflation is not only affecting the whole of Europe but also the US, and it is affecting multiple sectors, from the food industry to the automotive sector and the construction sector. 

How construction is dealing with a new emergency

2021 was a year of rebirth for the construction industry. It was one of the main drivers of the post-pandemic economic recovery across Europe, with peaks of up to 15% growth in countries such as Italy and the UK. 

That being said, in recent months the industry has been hit hard by another emergency: the drastic rise in commodity prices. The increase in the cost of hundreds of raw materials has had an impact on the entire sector globally, so much so that the price of construction materials jumped nearly 20% in 2021 according to Associated General Contractors of America.

The price of iron, for example, has increased by 243% in the last nine months, adding to the extensive list of construction materials that have risen sharply round steel serves as another example as its price increased by 250% in one year. In addition, other essential construction materials have risen sharply: the cost of copper has risen by 21.63%, aluminium by 35.76% and lithium by 98.92%, as well as fuels, electricity, timber, PVC, and concrete.

According to Associazione Nazionale Costruzioni Edili (ANCE), the anomalous dynamics of the prices of important raw materials are putting a strain on the construction sector that, after a long recession, is starting to show important positive signals, driven mainly by tax incentives on renovations and public investment. However, the current situation risks endangering the projects that are already underway and are producing negative repercussions on countries’ abilities (especially Italy’s, since it is the single biggest beneficiary of funds) to carry out planned investments under the National Recovery and Resilience Plan (NRRP) programme.

Health crisis and restart

Inflation is here to stay, and its effects will be felt all over the world. This spike is due both to the ongoing effects of the health crisis, which has caused a particular shortage of supply due to global lockdowns and logistics issues, and the consequences of the acceleration in 2021, which generated a sharp increase in demand. For example, one of the main drivers of inflation for steel, as indicated in the OECD's December 2020 report, was the sudden increase in demand from the construction sector in China. This rebound triggered an upward effect on the price of raw materials and on the entire global steel supply chain. It should be noted that China accounts for over 50% of world steel production and consumption and, in particular, construction in China accounts for 40%.  

Required measures

Prices are not expected to correct at least until the end of 2022. In fact, further inflationary surges could occur, especially with regards to energy prices which are being boosted by geopolitical tensions in Ukraine. Governments cannot turn a blind eye to this, and companies cannot be expected to cover this extraordinary cost increase on their own.

Without a significant price list adjustment and a structural price revision mechanism for public works, it will be difficult for companies to tender for work in 2022. Government action to counter rising materials and energy costs in the short to medium term is essential to ensure that the resources of the NRPP don’t go to waste. Italy, and all other European recipients of funding, are on a strict deadline. The Recovery Fund monies must be deployed quickly and efficiently over the next few years. In order for this to occur, policymakers need to tackle the issue of inflation head-on.

The ride-hailing company claims to be valued at £6 billion in the latest funding round, which is the largest to date. 

Bolt was founded in 2013 in Estonia by Markus Villig and now operates in 45 countries in Europe, Africa, Western Asia, and Latin America. The company launched in London in 2019 and so far only offers its ride-hailing service in the UK. Bolt plans to use the new investment to expand its offering in the UK, with the potential launch of e-scooter and e-bike rentals. 

We’re pleased to announce this new round of funding – the biggest in our history – which will help us build a future in which cities have less congestion, less pollution and more green spaces where people can easily move around in a safe and sustainable way,” said CEO Markus Villig. 

Bolt currently has over 100 million customers worldwide, including 4 million in the UK. 

Energy prices, which were up 26% compared to a year earlier, remain the key driver behind the jump. However, increases for food, services, and imported goods were also notably above the EBC’s overall 2% inflation target. 

As the economy began to recover from the initial shock of the pandemic last year, price growth took off, catching the ECB off guard. 

Supply-chain bottlenecks reducing the availability of consumer products also added to the upward pressure. Meanwhile, after lockdowns forced them to save up disposable incomes for several months, many households are now spending widely on everything from restaurant meals to new vehicles. 

Many of these inflation drivers are temporary, meaning price pressures will likely ease off gradually. The ECB predicts inflation will return to below 2% by the end of this year. However, this is a prediction questioned by a number of policymakers who believe above-target inflation readings could persist into 2023. 

According to the Purchasing Managers’ Index (PMI), a survey from IHS Markit, private sector growth waned to its weakest in nine months, with the eurozone’s index score dropping to 53.3, down from 55.4 in November. Any score exceeding 50 indicates growth, meaning this decline represents a slowdown instead of a contraction. However, GDP in Germany appeared more concerning, with a PMI of 49.9, suggesting that business activity in the nation may be shrinking. 

Manufacturers in Europe expanded faster than services businesses for the first time since last summer. This suggests a return to the pattern seen at the beginning of the pandemic when physical goods productions and sales were stronger than those involving in-person transactions. Nonetheless, factory bosses remain concerned about the potential of a renewed slowdown. 

In Germany, car manufacturers account for approximately one-tenth of the country’s economy. Those in the industry have reported increasing pessimism, with the ifo Institute warning that the business situation has been worsening for the past five consecutive months. 

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