War in Ukraine to tech layoffs: A look at 10 events that defined 2022- QHN

As 2023 knocks at the door, it is time we looked at the year gone by. 2022 will be remembered as the year the world shifted permanently. From war, to the fall of an industry, people losing jobs, and nations standing up for human rights, here is a look at 10 highlights of 2022:

Putin’s war in Ukraine

In February 2022, the world woke up to a rude shock, when Russian President Vladimir Putin announced the invasion of Ukraine. The war is still on and has killed thousands, and displaced millions.

In a globalised world, it is hard for any country to remain isolated from the conflict. The war has dragged on into its 10th month and has disrupted global supply chains causing inflation.

The International Monetary Fund (IMF) in March warned that both Russia and Ukraine are major commodity producers, and disruptions there will slow growth and increase inflation, especially for oil and natural gas.

Ukraine and Russia account for up to 30 per cent of the global exports for wheat, and food prices too jumped.

Following sanctions from the west and US, the European continent’s worst fear came true. Europe finds itself stuck in winter without energy security and in a deep energy shortage. Russia’s gas which is critical for industrial processes and power has been cut in supply by more than 80 per cent this year, according to the IMF.

Twitter Takeover

It all started in March 2022, when Elon Musk quietly acquired a 9.2 per cent stake in Twitter, without the company’s knowledge and revealed himself as the biggest shareholder in the microblogging site in April.

After declining Twitter’s proposal to join the Twitter Board, Musk launched a hostile bid for Twitter at a $44 billion valuation. After the initial fight, when Twitter finally agreed to Musk’s takeover, the billionaire tweeted that the deal was “on hold” because of spam bots. He demanded that Twitter CEO Parag Agrawal “prove” metrics on spam and bot accounts.

Twitter agreed to provide Musk with what he asked for. But, in July, Musk announced that he was terminating his deal because the micro-blogging site had breached multiple provisions of the merger agreement.

Twitter in turn took Musk to court for pulling out of the $44 billion deal.

After much drama, inside and outside court, Musk finally announced he is buying Twitter on October 4 and completed the deal on October 28 and tweeted “The bird is free”.

The deal is done but the drama surrounding Twitter and Musk continues, as the social media platform saw mass layoffs and many changes since Musk took over.

High Attrition and Tech Layoffs

The rising costs and high attrition impacted businesses across the globe. The margins grew thinner and as the world was expecting to bounce back from the impact of the Covid-19 pandemic, the war in Ukraine prolonged the process of recovery. Information Technology (IT) sector was among the worst hit.

There was no major company that did not lay off its employees in 2022. According to a report by IANS, major layoffs by tech companies in 2022 alone surpassed the levels of the 2008 depression that began with the Lehman Brothers collapse.

In 2008, tech companies laid off about 65,000 employees, and a similar number of workers lost their livelihoods in 2009, according to data by global outplacement and career transitioning firm global outplacement & career transitioning firm Challenger, Gray & Christmas.

By comparison, 965 tech companies laid off more than 150,000 employees this year globally, surpassing the Great Recession levels of 2008-2009.

The trend is expected to carry in at least the first half of 2023.

High inflation and macroeconomic instability

While the loose monetary policies of central banks put more money in the hands of consumers, first Covid-19 and then the war in Ukraine pushed commodity prices up. In the next few months, the world saw inflation rise to a level it hadn’t in decades. Crude oil touched $140 per barrel just weeks into the war. The core inflation has remained elevated across the globe even 10 months after the war broke out.

In India, inflation stayed outside the Reserve Bank of India (RBI)’s upper tolerance limit of 6 per cent for 10 straight months till November.

In the UK, the inflation in October at 11.1 per cent was the highest in 41 years. In the US too, October inflation of 8.5 per cent was the highest in 40 years. A similar situation was recorded in various countries across the globe.

In response, the central banks started raising their benchmark interest rates. The RBI raised the repo rate by 225 basis points cumulatively and the US Fed has raised its interest rate by 425 basis points. Except for China, almost all the major economies of the globe followed.

This in turn led to fears of recession. The share markets remained highly volatile and investors were kept on their toes.

The fall of cryptocurrency

As 2021 was ending, Cryptocurrency was the talk of the town. Bitcoin touched its all-time high of over $64,000 in November 2021. The total market cap of the crypto industry was over $2.2 trillion at the dawn of 2022.

However, if anything, 2022 will be known for the spectacular fall of crypto. On December 31, Bitcoin was trading at $16,609 and the total market cap of the crypto industry is $799 billion. Investors have lost nearly 70 per cent of their wealth, as compared to just a year ago.

After the collapse of Terra-Luna early in the year, several crypto exchanges filed for bankruptcy. But the fall of once the third-largest crypto exchange FTX accentuated the situation. Sam Bankman-Fried, FTX’s founder and CEO was charged with fraud in the US and billions of dollars vanished into thin air.

The RBI in November, launched the pilot for its digital currency, Central Bank Digital Currency (CBDC) or e-Rupee.

First Fifa world cup in west Asia

Qatar became the first country in west Asia to organise the Fifa World Cup. It was the costliest world cup in the history of football with some estimates pegging the estimated expenditure to be around $200 billion. The country rebuilt itself to organise the cup.

The World Cup was particularly different from its earlier editions. Underdogs like Japan, Morocco and Saudi Arabia stunned big teams like Portugal, Spain and Argentina. Morocco became the first African nation to reach the semi-finals.

The final match between France and Argentina is being called by football fans the “best final ever”. After a nail-biting match that stretched into extra time, the final result was arrived at using penalties. Argentina emerged victorious and Lionel Messi won his first and most likely last World Cup. France’s Mbappe won the Golden Boot for the highest number of goals (8) scored.

Financial Crisis in the UK and Rishi Sunak

Exactly one year ago, not many Indians would have believed if someone had told them that a person of Indian origin will become United Kingdom’s (UK’s) prime minister in the year. Today, Rishi Sunak is leading the country and trying to navigate it through a tough financial crisis.

Before him, Liz Truss resigned and became the shortest-serving PM (45 days) in UK’s history mostly due to her economic policies. She had succeeded Boris Johnson who was also ousted from 10 Downing Street for his failure to deal with the crisis.

Since the start of the Covid-19 pandemic, the UK saw its economic condition worsening. The cost of living was through the ceiling. However, Johnson kept telling the public that they would manage through it.

Soon, the war in Ukraine shot up the oil prices. The prices of other commodities too rose. Inflation as well as the fiscal deficit was rising but the government was not able to control it. Johnson was removed from the office. Soon, Truss was also ousted. Sunak is trying to improve the situation but not much has been achieved yet.

The UK also lost its longest-serving monarch, Queen Elizabeth II on September 8. She was 96 at the time of her death.

Protests in Iran

The death of Mahsa Amini, a 22-year-old Iranian-Kurdish woman, has sparked one of the biggest anti-government protests in Iran since the Islamic Revolution of 1978-79.

Amini had been arrested by Iran’s moral police called “Guidance Patrol” for allegedly violating Iran’s hijab law by wearing her hijab “improperly” while visiting Tehran. She died in police custody. While the authorities said she died of illness, the eyewitnesses claim she was brutally beaten by the morality police.

As the news spread, videos of Iranian women cutting their hair as a sign of mourning and protest against the moral police and government started surfacing on social media. Soon women from around the world joined to show solidarity. Since then, Iran has witnessed massive protests within the country.

In September, the Iranian authorities arrested two Iranian women journalists, Niloofar Hamedi and Elahe Mohammadi, who helped make public the story of Mahsa Amini, on charges of being “CIA agents”, and the “primary sources of news for foreign media”.

According to Human Rights Activists in Iran, at least 12 people have already been sentenced to death in closed-door hearings and nearly 488 people have been killed since the demonstrations began in mid-September. In December, Iran publicly hanged Majidreza Rahnavard, the second protest-related execution.

Sri Lanka’s economic crisis

In July 2022, Sri Lanka found itself in deep turmoil when angry protestors frustrated with President Gotabaya Rajapaksa and his government took to the street and stormed into the presidential palace, bathed in the swimming pool, and used his bathrooms. Soon the videos went viral on the internet and the world witnessed Sri Lanka’s mess.

Rajapaksa instead of facing his people fled the country after hiding for several days. He then resigned from the post of president from Singapore and made the then Prime Minister Ranil Wickremesinghe the acting president.

The main reason behind the political chaos was Sri Lanka’s poor economy, for which Rajasaka’s government was seen as responsible.

Lanka didn’t have access to enough fuel for essential services like buses, trains and medical vehicles, and according to various reports the country ran short on foreign currency, thus making it difficult to import more fuel. This lack of fuel made petrol and diesel very expensive.

The situation was so bad that in June, the Lankan government banned the sale of petrol and diesel for non-essential vehicles for two weeks. Reportedly, the country owes more than 51 billion dollars to foreign lenders.

As a consequence of which, schools closed, and people were asked to work from home.

Mr Wickremesinghe declared a state of emergency across the country and imposed a curfew in the western province while he tried to stabilise the situation. But, on Wednesday, hundreds of protesters stormed his office, amid calls for his resignation.

While the government blamed the Covid-19 pandemic and the 2019 bomb attacks that hit the island country’s tourism, the Lankans held Rajaspaka’s poor economic decisions responsible.

Sri Lanka’s import bill was way more than its exports, which ran dry its coffers at a time when tourism–one of its biggest sources of foreign currency was hit by the Pandemic.

Further, big tax cuts by the government in 2019 cost more than $1.4 billion a year to its purse.

Rare climate events

Be it the catastrophic floods in Pakistan, the heatwave in Europe or the most number of wildfires since 2017 in the USA, the world witnessed many global extremes this year.

Pakistan was hit by one of the worst floods in history in July 2022. According to reports, 110 of the 150 districts in the country were affected by the floods.

The flood was caused by an extremely wet monsoon season, with more than the usual spells of rain in the country.

Europe on the other hand saw a heatwave that broke several records. For the first time, the UK recorded temperatures above 40 degrees Celsius. France too saw temperatures rising to an all-time high of 45 degrees Celsius.