The performance of an economy deteriorates when civil war erupts. In this case, people lose their lives whereas the infrastructure of a nation gets destroyed. Moreover, they the legal state of a nation becomes weak. In addition, people’s rights to own property are violated.
Civil war also introduces uncertainty into an economy thereby making it risky for investors to establish their businesses in a conflict-prone country (Azam 15). There are various ways through which civil war impacts on the wellbeing of a country.
For example, civil war limits the growth of capital stock. It also forces investors to depart from a country thereby reducing the level of investment. Moreover, civil war worsens the government’s fiscal balance (Thornton and Ekelund 5). As a result, a country’s GDP growth starts deteriorating.
Studies reveal that civil war can either take part in one part of a country or it can spread to all parts of a nation. Civil war leads to a large number of civilian deaths. For example, civil wars that took place in Sierra Leone, Guatemala and Mozambique led to many civilian deaths.
In this case, it is true that the civil wars that require high level of military recruitment lead to massive death of people (Thornton and Ekelund 12). Therefore, it is true that civil war damages the economic forces of a country.
The goal of this paper therefore is to discuss the economic effect of civil war on the Gross Domestic Product (GDP) growth of a country. It will conduct a study on Sudan and discuss how the civil war led to the deterioration of economic forces in the country.
Methodology
The purpose of this paper is to determine how civil war contributes to the deterioration of economic forces in a country. This paper will focus on the civil war that took place in Sudan and illustrate how it influenced the performance of the economy.
It will gather information from books and journals in order to demonstrate the impact of civil war in Sudan. The sources will provide data about the state of Sudan before the civil war and the state of the economy after the war. Moreover, the paper will provide a literature review which will illustrate the destructive nature of civil war in a country.
The information obtained from the literature will be used to show the relationship between the impact of civil war in Sudan and other countries that experience conflicts in their development process.
Significance
When people in a country become violent, the stability of a nation deteriorates significantly. When civil war erupts in a country, the wellbeing of the economic forces is disrupted. Many people lose their lives as a result of a civil war.
Moreover, the infrastructure of a country is destroyed. In addition, the level of GDP growth drops significantly. In this case, people suffer from lack of basic needs such as shelter, clothing, food and health care. As a result, the productivity of a state deteriorates thereby exposing the population to poor living conditions.
Therefore, this paper will demonstrate the negative impact of civil war on economic performance. It will provide a basis whereby governments, researchers and analysts should propose solutions in order to address the negative impacts of civil war.
As a result, they would be able to implement measures that would minimize the destructive nature of civil war in conflict-prone countries.
Overview of Civil War in Sudan
The level of output in a country drops significantly when a civil war erupts. However, when a civil war becomes persistent, physical and human capital is destroyed. This form of destruction takes a long time to reverse. There are various negative effects that are associated with internal conflicts.
For example, the destruction that the military carries out while trying to end a civil war reduces the amount of capital in a country. Moreover, the government extends its spending to economic services. In this case, the government invests its funds on the services that are provided by the military and the police (Aldosari 37).
In this perspective therefore, it is true that the economic consequences of civil war are useful in terms of analysing the economic performance of Sudan. The civil war that took place between 1962 and 1972 characterizes post-independence Sudan. Sudan experienced one of the longest civil wars in Africa.
The civil war that took place in the country led to political instability, violation of property rights, and erosion of fiscal instruments. Moreover, the human, physical and financial resources were directed to the military. The number of war casualties was enormous thereby leading to a reduction of human resources in the country (Elbadawi and Gadir 19).
The military expenses in Sudan as a result of the civil war that took place between 1989 and 1994 made the country to experience a 16% decline in investment levels. Moreover, the per capita growth experienced a 2% drop in the same period. However, the investment ratio declined by 196% when the war intensified (Elbadawi and Gadir 23).
The table illustrates Sudan’s five year moving average as a result of the civil war. Before the civil war (1973-1983), the real per capita growth rate was approximately 4.27%. However, after the aftermath of the second civil war in Sudan, the real per capita growth rate went down to 2.11%.
This is regardless of the oil inflows that were coming into the country. Before the inflow of oil investments between 1984 and 1997, the per capita growth rate dropped to 2.63%. Therefore, the war reduced the GDP growth rate of the country by 1.86%.
The impact of oil production on the economic performance of Sudan was realized between 1995 and 1997. The country had become stable at this time. From the table, the marginal difference between the growth rates shows that the production of oil in Sudan minimised the effects of the civil war.
The cost of civil war in Sudan: Foregone per capita growth
Source: (Elbadawi and Gadir 27)
Literature Review
Demonstrations, strikes and protests take time, money and government effort to terminate them. When funds are scarce, the government is unable to fund the consumption and production levels in a country. Therefore, it is true that conflicts should not be entertained since they use the resources that are normally used to fund production processes in a country (Chamarbagwala and Moran 43).
Internal conflicts impact on the overall performance of an economy. For example, people who live in war zones incur injuries, get displaced from their homes and their children are denied opportunities to attend school. As a result, the productivity and earnings of a country go down significantly.
In order for a country to recover from conflict-related destructions, it should evaluate the economic forces that are affected by the conflicts thoroughly (Chamarbagwala and Moran 48). Moreover, since the costs of war are normally felt by the marginalized groups in a country, a nation should ensure that internal conflicts do not intensify inequality and poverty.
As a result, the government should implement measures to ensure that its citizens do not participate in conflicts. For example, the civil war that took place in Guatemala between 1960 and 1996 limited the accumulation of human capital in the country (Berhanu 43).
The accumulation of human capital is affected when families are displaced and their breadwinners get killed. Therefore, in order for a country to keep its consumption levels high, it is forced to withdraw its resources from schooling and direct them to basic needs such as health, clothing, shelter and food.
After the civil war erupted in Guatemala in 1970s, more than 500,000 people were displaced from their homes (Berhanu 42). Moreover, more than half of the affected families lost their property and relatives. As a result, children were orphaned when their families were killed.
In this case, children were removed from school and taken to work. In addition, schools were destroyed and teachers killed. As a result, children were forced to leave school completely.
Since the armed forces targeted civilians, parents were forced to keep their children out of school in order to keep them safe from the conflicts (Evia, Leserna and Skaperdas 34).
In the case of a civil war, males are targeted in order to prevent them from becoming combatants. However, the most vulnerable groups in a country are those whose livelihoods are affected by a civil war. Studies show that Guatemala’s civil war affected the state of education negatively.
The war deepened poverty levels among the marginalised groups in the country. However, since the war in Guatemala lasted for 36 years, it affected the potential of the human resources significantly (Chamarbagwala and Moran 44). Moreover, families were displaced thereby heightening poverty levels in the country.
On the other hand, the socio-political conflicts that took place in Bolivia also affected the economic performance of the country. The types of conflicts that were observed in the country include demonstrations, road blockades and strikes. All types of conflicts have costs.
Moreover, all resources are directed to military expenses in the case of a civil war. Moreover, they reduce the levels of investment in a country thereby making the level of economic growth to decline (Abadia and Gardeazabal 116).
The conflicts that were observed in this country were carried out by organized groups. These groups were formed on the basis of economic, ethnic and social dimensions. They were composed of business groups, unions, ordinary workers, and associations (Aldosari 7).
The acute conflicts that took place in Bolivia in 1970s were related to the struggle for democracy and civil rights. The period between 1978 and 1982 was characterized by social unrests. The conflicts ended when the country was transformed into a democratic state.
During this time, the world economy deteriorated and natural disasters prevailed thereby resulting to a series of social unrests in the country. The social unrests made the country to experience hyperinflation. Therefore, the government was forced to end its term and call for fresh elections. Between 1978 and 1985, the growth of the country was approximately -1.1% (Evia, Leserna and Skaperdas 45).
Therefore, it is evident that the socio-political instability in the country made the output levels of the country to decline. Therefore, it is true that there is a negative relationship between socio-political conflicts and economic growth.
Conclusion and Policy Recommendations
From the analysis therefore, it is true that civil war leads to destruction of infrastructure in a country. Moreover, it leads to loss of human resources thereby making the performance of a state to deteriorate. Schools are closed and breadwinners of families get killed.
As a result, children are forced to leave school in order to look for a means of survival. Moreover, institutions and corporations are destroyed thereby bringing down the productivity of a country. Today, Sudan is one of the poorest states in Africa.
This is because the civil war that took place in the country led to the destruction of economic forces (Berhanu 27). The economic performance of the country is poor despite the fact that it is rich in oil.
As a result, it is vital for the government of Sudan to implement measures that will unite the efforts of the people in the country in order to improve performance of the economy.
It should also improve the quality of education in the country in order to improve the productivity of the human resources. Moreover, it should improve the infrastructure of the country in order to attract foreign investors who would boost the country’s production potential.
Works Cited
Abadia, Alberto and Javier Gardeazabal. “The Economic cost of Conflict; A case Study of Basque Country.” The American Economic Review 93.1 (2003): 113-131. Print.
Aldosari, Ali. Middle East, western Asia, and northern Africa. London: Marshall Cavendish, 1990. Print.
Azam, Jean-Paul. Some economic consequences of the transition from civil war to peace. California: University of California, 2008. Print.
Berhanu, Denu G. Institutions and Investment in Sudan: Socio-Economic and Institutional Foundations of Reconstruction and Development. New York: LIT Verlag Münster, 2011. Print.
Chamarbagwala, Rubiana and Hilchias Moran. “The Human Capitlal Consequences of Civil war.” Journal of Development Economics 94.2011 (2008): 41-61. Print.
Elbadawi, Ibrahim and Ali Abdel Gadir. Explaining Sudan’s Economic Growth Performance. Washington DC: World Bank, 2004. Print.
Evia, Luis Jose, Roberto Leserna and Stergios Skaperdas. Socio-Political and Economic Performance in Bolivia. California: University of California, 2007. Print.
Thornton, Mark and Robert Burton Ekelund. Tariffs, Blockades, and Inflation: The Economics of the Civil War. London: Rowman & Littlefield, 2008. Print.