LONDON — The CEOs of several European blue chip companies have told CNBC that they see a significant recession coming down the pike in Europe.

This continent is especially vulnerable to the effects of the Russia-Ukraine conflict. associated economic sanctions and energy supply concernsIn recent weeks, economists have been downgrading the growth projections for euro area in recent weeks.

Consecutive economic shocks are facing the euro area from war in Ukraine as well as a spike in food and energy costs exacerbated due to the conflict and a supply shock caused by China’s zero Covid policies. That has prompted concerns about “stagflation” — an environment of low economic growth and high inflation — and eventual recession.

“For sure, we see a big recession in the making, but that’s exactly what we see — it’s in the making. “There is an overhanging need because of the Covid crises we are just about to leave,” stated Stefan Hartung CEO of German engineering giant and technology giant. Bosch.

It’s there, and it is still very severe in China. But, you can see the impact on other areas of the globe, where the consumer demand has increased.

Hartung specifically noted that there is still a demand for power tools, household appliances and cars, however, he suggested this will diminish.

He explained that while there will be some demand for the time being, the price rises and interest rates will continue to increase. But at some point, the supply crisis will not be limited to a shortage of products. It will be a crisis of demand and, then, we will be in deep recession.”

The record-breaking 7.5% inflation rate in the euro area reached in March. This is the first time that inflation has reached a record high of 7.5% in March. European Central BankIt has been more cautious than other peers like the Bank of England or the U.S. Federal Reserve. Both have increased interest rates to try and rein in inflation.

The ECB is now expecting to close net asset purchase under its APP in the third quarter. After that, it will have the option to tighten monetary policy depending on the economic outlook.

Holger Schmieding, Berenberg’s Chief Economist, stated in Friday’s note that Europe has near-term economic risks.

Schmieding explained that “Worsening Chinese lockingdowns and cautious consumer spend in response to high food and energy prices could easily cause an immediate contraction of Eurozone GDP in Q2”.

An immediate Russian embargo of gas imports could lead to a deeper recession. A recession that is caused by the Fed’s mistakes and sends the U.S. from boom to bust, although it is not impossible, could continue well into the next year.

Schmieding argued that the euro area is unlikely to go into recession “if worse comes to worse” and it’s not a base assumption.

BaFin president Mark Branson stated that any military conflict in Ukraine, or any further energy disruption, could have serious consequences for Europe’s largest economy. The industrial sector is particularly at risk.

We are already seeing that the growth rate is dropping to zero across many countries, which makes it vulnerable. “It’s also at risk from ongoing Covid related shocks,” said he.

“We have an inflation problem that must be addressed, and it needs to be dealt with now. This is a difficult mix for the economy.”

“Challenging business environments”

Slawomir Kripa, Vice CEO Societe GeneraleCNBC spoke to him on Thursday, saying that France’s lender was closely watching the macroeconomic situation.

“It’s obviously a fundamental piece of news for the macroeconomic context and the triggered inflation feedback loop between the energy shock – which was already going on before the war in Ukraine – you have the inflation expectation rising and the risk of a final, fundamental impact on the macroeconomy into a recession,” he said, adding that this would potentially affect “the entire system, and (SocGen) as well.”

Ola Kallenius is the CEO Mercedes-BenzCNBC reported that he also said last week to CNBC that China and Ukraine are creating “challenging” business environments for German luxury carmaker.

We have ongoing shortages, mainly in semiconductors. “On top of all that, we have new lockdowns now in China, which can also affect us in China and supply chains around the world. And, yes, it is the Ukraine war so the business environment has been challenging.” he said.

These comments were repeated by VolkswagenCNBC’s CEO Herbert Diess said that his company was also facing a challenging environment from Covid and the shortage of chips. He added that there were also concerns about the conflict in Ukraine.

MaerskSoren Skou CEO said on Thursday that the biggest shipping company worldwide is keeping an eye out for recession risk, in particular the United States. However, they don’t expect them to emerge until 2022/early 2023.