Violence Cost World Economy $8.1 Trillion: Research
The lack of world peace affects the economy by trapping productivity and removing vital resources, according to an international research institute which also put the cost of global violence at $8.1 trillion last year.
Steve Killelea, founder and executive chairman at the Institute of Economics and Peace told CNBC that by channelling resources into controlling violence and away from other resources, economic productivity is limited.
“If you can improve the peace you can move these resources into other areas that then unleashes trapped productivity, which improves the economy,” Killelea said.
The world is a less peaceful place for the third year running, with the ‘Arab Spring’ central to keeping world peace at bay, according to the Global Peace Index.
The IEP stated that violence cost the global economy $8.1 trillion in 2010.
“If you take the Arab Spring we have seen the greatest fall down the index of any nations in the five year history of the Global Peace Index.
They have fallen down the index on the obvious violence and instability we have seen but also on violent crime and with that there is a lot of cost to the economy,” Killelea said “When you deploy resources into areas which generate productivity you have a flow on effect,” he added.