The European Union (EU) will feel the consequences of anti-Russian sanctions and the economic crisis in Russia far worse than was previously expected, a study conducted by the Austrian Institute of Economic Research (WIFO) said, according to Le Figaro.
In the worst case scenario, more than 2 million jobs and over 100 billion euros will be lost in the EU, the study concluded.
"We hypothesize that the worst decline in export has become reality," said Oliver Fritz, one of the authors of the WIFO report, adding that in the first quarter of 2015, French exports to Russia fell by 33.6 percent from last year.
If the current trend continues throughout the year, Western sanctions and the economic crisis in Russia could affect over 1 percent of Germany's GDP by the end of the year. France, meanwhile, could lose around 0.5 percent of its GDP and 150,000 jobs. Overall, the economic crisis in Russia could threaten 1.9 million jobs and €80 billion ($90 billion) of the EU's overall GDP, the study by the Austrian Institute said.
At the same time, WIFO could not figure out the direct impact of Western sanctions on the Russian economy. The drop in global oil prices was a big part of the economic recession in Russia (similar to other oil exporting countries) and therefore it is hard to calculate the effect of Western sanctions on the Russian economy, Fritz from WIFO said.
In August, Moscow imposed a year-long food embargo on the countries that had sanctioned it, banning the import of many food products, such as milk, fruit, vegetables, cheese and meat. Food exporting countries, like Italy, Spain and the Netherlands were hit.
The decision on the extension of anti-Russian sanctions is due to be made next week at the meeting of EU foreign ministers. Moscow vows new countermeasures if the EU sanctions are kept.