The head of Wisconsin Manufacturers and Commerce warns rising energy costs tied to the war between Russia and Ukraine will impact factories and consumers in the state.
WMC President and CEO Kurt Bauer said in a statement the immediate impact of Russia’s invasion of Ukraine will drive energy costs “even higher than they already are.”
“Rising energy costs are very regressive for consumers, especially during the home heating season. But rising costs will also have a major impact on factories in a manufacturing state like Wisconsin,” Bauer said. “Higher producer costs are upstream of consumer costs, which means the Russian invasion will exacerbate existing inflationary pressures.”
Meanwhile, a trade consultant with the Wisconsin Small Business Development Center says exporters will need to prove their products will not end up in the Donetsk and Luhansk separatist regions of Ukraine, under federal sanctions.
“There is a potential upside, however, for organizations with the foresight to mobilize considering disruptive scenarios — and respond in a way that ultimately powers their performance,” the SBDC’s Chris Wojtowicz wrote in a blog post.
Data provided by the Wisconsin Economic Development Corp. show state exports to Ukraine reached a peak of $60.5 million in 2017 and have been on a downward trend since then, reaching $20.6 million last year. Most of the state’s exports to Ukraine last year were industrial machinery and vehicles, according to WEDC.
Wisconsin imports from Ukraine have ranged between $3 million and $5 million since 2014, hitting $3.8 million in 2021.
Meanwhile, state exports to Russia were $109.1 million in 2021, with the nation ranking 35th among Wisconsin export destinations. Exports to Russia have been between $107 million and $121 million over the past five years, with industrial machinery and medical and scientific instruments making up the majority of those products.
State imports from Russia totaled $26.4 million last year, reaching their highest level in the past 10 years, WEDC data show.
See the SBDC post here: https://wisconsinsbdc.org/2022/02/24/ukraine-russia-and-the-world-the-weaponizing-of-sanctions/
–By Alex Moe