GDP of some European countries could drop 6% if Russia cuts gas, says IMF

A complete interruption of gas supplies from Russia to Europe would have a devastating effect on Eastern and Central European countries, which could see their Gross Domestic Product (GDP) fall by around 6%, according to a report. published this Tuesday (19) by the International Monetary Fund (IMF).

In Germany, the main economic engine of the European Union, GDP would fall by about 3 % in the case of a total cut. In the case of Spain, which is much less dependent on gas from Russia, the effect would be significantly more limited, and the drop in GDP would be around 1%, the same for France.

The countries whose economies would suffer the most from a total Russian blockade – an increasingly speculated option – would be, in that order, Hungary, Slovakia, Czech Republic, Italy, Germany, Austria, Romania, Slovenia, Croatia, Poland and the Netherlands.

Of these, the first four (Hungary, Slovakia, Czech Republic and Italy) would suffer a drop in activity of around 6% of GDP. In all of them, except Italy, there is, according to the IMF, a risk that, if Russia cuts off gas, the supply could fall by up to 40%.

“These impacts could be mitigated by finding alternative sources of supply, alleviating infrastructure bottlenecks, promoting energy savings, and increasing solidarity agreements between countries to share gas,” says the report.

O Russian gas covers 40% of Europe’s gas needs, which has so far decided not to veto the purchase of fuel from Russia, which in turn has already suspended all or part of supply to 12 countries.

In recent months, shipments to Europe via Ukraine have dropped by almost 30%, and those from the Nord Stream gas pipeline, which carries the Russian gas directly to Germany under the Baltic Sea at 60%.

Nord Stream is currently at a technical standstill for “planned maintenance”, and its feasibility is uncertain due to problems in the overhaul of the turbines that Russia found it due to Western sanctions, according to Russian state-owned company Gazprom.

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