Ukraine war poses biggest global economic threat: Yellen

BALI • Russia's war in Ukraine poses the greatest threat to the global economy, US Treasury Secretary Janet Yellen said yesterday as Group of 20 (G-20) ministers prepare to start talks in Indonesia.

Moscow's invasion has sent inflation soaring at a time when the world is struggling to recover from the Covid-19 pandemic, endangering the gains of the past two years and threatening widespread hunger and poverty.

"We are seeing negative spillover effects from that war in every corner of the world, particularly with respect to higher energy prices and rising food insecurity," Dr Yellen said on the resort island of Bali ahead of a meeting between finance ministers from the world's top economies and central bank governors today and tomorrow.

"The international community must be clear-eyed about holding (Russian President Vladimir) Putin accountable for the global economic and humanitarian consequences of his war."

Dr Yellen said she will continue to press G-20 allies at the meeting for a price cap on Russian oil to choke off Mr Putin's war chest and pressure Moscow to end its invasion, while bringing down energy costs. "A limit on the price of Russian oil would deny Putin revenue that his war machine needs."

She expressed hope that India and China would join such a cap, saying it "would serve their own interests" to put downward pressure on prices for consumers globally.

Russia's Foreign Ministry said yesterday that attempts to cap oil prices may cause them to rise. "Those plans are anti-market and risky," it said at a weekly briefing.

Yesterday, Dr Yellen refused to be drawn into whether Western officials will stage a multi-nation walkout when Russian officials speak, as they did at a G-20 meeting in Washington in April. "It cannot be business as usual," she said.

AGENCE FRANCE-PRESSE, REUTERS