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How The Russian-Ukrainian War Has Shapped The State Aid Policy In Eu1

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  • Andreea-Emanuela Drăgoi

    (Institute for World Economy, Romanian Academy)

Abstract

The ongoing war from Ukraine (started by the Russian Federations’ unprovoked military aggression on Ukraine in February 2022) has created a tense geopolitical situation with widespread economic repercussions, affecting not only the directly involved parties but also their economic partners. The European Union (EU) has been significantly impacted by this event, particularly through the sanctions imposed on the Russian Federation, which have disrupted the bilateral trade. Against this background, the European authorities have utilized the State aid policy to mitigate the adverse effects of the Russian-Ukrainian war on the economies of the Member States. Our research focuses on identifying the main instruments used in the field of State aid and on examining how the Member States, particularly Romania, have leveraged these tools to lessen the war's negative impact on their national economies. To achieve this, we will conduct a comparative analysis of the State aid provided since the start of the Russian-Ukrainian war, using the latest data published by the European Commission in the State Aid Scoreboard. Additionally, we will present a case study on how Romania has utilized the Temporary Crisis Framework (TCF) and the Temporary Crisis and Transition Framework (TCTF) to support its national economy amid the war's consequences. Our primary finding reveals that, similar to the pandemic crisis, the State aid policy has proved its effectiveness and adaptability in promptly supporting the economies of the Member States affected by the Ukrainian war. Furthermore, our second finding shows that Romania has successfully taken advantage of the new opportunities presented by TCF and TCTF.

Suggested Citation

  • Andreea-Emanuela Drăgoi, 2024. "How The Russian-Ukrainian War Has Shapped The State Aid Policy In Eu1," Global Economic Observer, "Nicolae Titulescu" University of Bucharest, Faculty of Economic Sciences;Institute for World Economy of the Romanian Academy, vol. 12(1), pages 26-37, June.
  • Handle: RePEc:ntu:ntugeo:vol12-iss1-26-37
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    References listed on IDEAS

    as
    1. Martyna Żak & Jakub Garncarz, 2020. "Economic policy towards the challenges of the COVID-19 pandemic in selected European Union countries," International Entrepreneurship Review, Centre for Strategic and International Entrepreneurship at the Cracow University of Economics., vol. 6(4), pages 21-34.
    2. Jonas Grafström & Patrik Söderholm & Erik Gawel & Paul Lehmann & Sebastian Strunz, 2023. "Government support to renewable energy R&D: drivers and strategic interactions among EU Member States," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 32(1), pages 1-24, January.
    3. Anatolijs Prohorovs, 2022. "Russia’s War in Ukraine: Consequences for European Countries’ Businesses and Economies," JRFM, MDPI, vol. 15(7), pages 1-15, July.
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    More about this item

    Keywords

    Russian-Ukrainian war; State aid; Temporary Crisis Framework; Temporary Crisis and Transition Framework; EU; Romania;
    All these keywords.

    JEL classification:

    • F01 - International Economics - - General - - - Global Outlook
    • P43 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Finance; Public Finance
    • P45 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - International Linkages
    • P49 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Other

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