The Economic Effects for Germany of a Stop of Energy Imports from Russia

  • The Economic Effects for Germany of a Stop of Energy Imports from Russia
  • Effects of Decoupling Trade Relations between East and West
  • Pandemic Fiscal Support in the EU
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EconPol-Pillars Conference 2022
A Review of Four Years of Econpol Europe
The Economic Effects for Germany of a Stop of Energy Imports from Russia
In the short term, a halt to Russian energy imports could cost Germany up to 3 percent of its gross domestic product. The cost of stopping energy imports would be significant, considering that the coronavirus pandemic cost about 4.5 percent of economic output. This is the key finding of the new EconPol Policy Report. Oil and coal could be replaced by imports from other countries. However, it is harder to find replacements for Russian gas in the short term.
Effects of Decoupling Trade Relations between East and West
A new EconPol Policy Brief analyzes the long-run effects of an economic decoupling between the political West (i.e. the EU, the US and their allies) and the East (first and foremost Russia and China). A decoupling of Russia from the US and its allies would have much more severe long-term impacts for real income in Russia (minus 9.7 percent) than in the US and its allies (minus 0.2 percent). The reason for the uneven distribution of costs lies primarily in Russia’s low economic importance compared with the US and its allies.
Pandemic Fiscal Support in the EU
The initial fiscal reactions of EU Member States to the pandemic have differed considerably. Particularly for Greece, Italy and Germany the magnitude of the reaction is striking. In the case of Germany especially the rules on short-time work are very generous and appear problematic. In the most recent EconPol Policy Report Friedrich Heinemann suggests a particular urgency to scale back the fiscal support with the progressing economic normalization.
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EconPol – Pillars Conference 2022
On July 11-12, 2022 the EconPol – Pillars Interim Conference will take place at the Representation of the Free State of Bavaria to the EU in Brussels. 
On the first day, the findings on different aspects of the Pillars brief will be presented and discussed, covering such aspects as using internet data to predict labor market evolution, among other topics. 
On the second day, several policy panels will address the implications of competition with China and Latin America for the European labor markets, the impact of automation, and successful policy examples.
Further information on the program and the invitation will follow in the coming weeks.
A Review of Four Years of Econpol Europe 
What has EconPol Europe achieved since its foundation? How has the network developed and how will it look in the future? A review of the last four years of EconPol Europe can be found in the monthly report (in German) of the German Ministry of Finance (BMF). The foundation of EconPol Europe in spring 2017 by the ifo Institute was made possible by an initiative and the financial support of the ministry. With the expiration of the funding in the end of 2021, EconPol was transferred into the CESifo research network. 
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EconPol is CESifo’s economic policy platform. With key support from the ifo Institute, it seeks to leverage CESifo’s globe-spanning network of 1 800 high-ranked economists – eleven of whom have won the Nobel Prize – and ifo’s decades-deep research expertise to provide well-founded advice to European policymakers.
Drawing on the wide range of specializations of its members, EconPol’s mission is to contribute to the crafting of effective economic policy in the face of the rapidly evolving challenges faced by the European Union, to the ultimate benefit of all its member states.
© EconPol Europe – CESifo GmbH 2022.

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