Effects of conflict on Global Economy

The 2021 Economic Value of Peace report shows that the global economic impact of violence is estimated to be $14.4 trillion.

Conflict means (literally) an open clash between two groups or individuals. As the world is marching towards technological advancement, nationalism and modernization, the scale and number of conflicts around the globe is soaring high. It is an open secret that government officials take extreme steps, often at the expense of human lives for the sake of territorial expansion or other “national” interests. This incessant desire of officials or individuals has catastrophic effects on humanity. It causes human and property loss, degrades mental well being of people and causes them an eternity of misery, however this is just the tip of the iceberg. The ongoing case of Afghanistan and Russia- Ukraine are living examples. 

One of the major domain that is hit hard by conflicts is the Global economy. It causes unemployment, inflation, debt trap, infrastructure loss, to name a few. Thereby, pushing people on the periphery of poverty. Due to the Russia – Ukraine conflict, the prices of oil and gas have skyrocketed. It has also affected the price of wheat since both the nations account for 30% export of wheat. The World Bank’s baseline projection assumes Ukraine’ s poverty, based on the $5.50 per day threshold rate , will increase from 1.8% in 2021 to 19.8% in 2022. The conflict has severely affected nations that have fewer job opportunities , unstable governments and are heavily dependent on imports for their livelihood as in the case of Egypt. The war has also halted the  European carmakers from supplying key parts which are manufactured in Ukraine. Due to rising fuel prices, sanctions and travel restrictions, tourism has also been deeply affected. The effects of conflicts on global economy are critical and it must be stopped before it’s too late.

Nations should be more inclusive, cooperative and flexible. Instead of focusing on unessential issues like territorial expansion which arise purely out of greed and does no good to anybody, governments should lay more emphasis on poverty, gender equality, sustainable development etc. “ For the strength of the pack is the wolf, and the strength of the wolf is the pack”.