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2 years ago

Negative externalities that might occur in the South african economy due to the ukraine war

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During the Ukraine war, the negative externalities that might affect the South African economy can be food security and trade which resulted in disturbances in financial security.

<h3>What is the meaning of negative externality?</h3>

The negative externality refers to the cost borne by a third party due to the outcome of an economic transaction of another party. Another party can be the manufacturer of the goods and the third party can be the individuals or organization.

The negative externalities that affect the economy of South Africa due to the Ukraine war can be the trading between both countries. The foods that they imported from Ukraine are becoming very difficult. This results in rising prices of food in South Africa which affects the individuals of the country due to which they started buying lesser goods.

Therefore, the imported food items and the trading affected a lot of the South African economy due to the Ukraine war.

Learn more about the negative externality in the related link;

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