Terrorism involves the intentional use of violence against civilians. Terrorists are done for political purposes. In some cases, conflicts between religions cause terrorism. The global economy has been affected by terrorism in the past, and people fear terror attacks. Terrorism has affected the global economies because the emergence of globalization created the unity of different countries.
When the economy of a country is affected, other countries are affected. Trade between different countries has led to the spill-over effect of terror attacks in certain countries. Therefore, a crisis affecting one country affects the other countries due to the interconnections between or among them.
Terrorism has impacted the global economy negatively. Various strategies have been applied to fight terrorism, however, terrorism continues to be a substantial threat to economic development (Jackson, 2). This study shows how terrorism has impacted the global economy negatively. The paper indicates that terrorism is instrumental in causing adverse effects to economic activities.
Terrorism has been a serious menace to global economies. Governments have united in the fight against terrorism. For about thirty five years, the incidents of terrorist have accumulated to twenty thousand. These incidents have caused the death of more than ninety thousand people. Terrorism affects the economies of countries in that it prevents foreign investors from investing in a country that has a high rate of attacks. In addition, terrorism also causes destruction of property and infrastructure (Young, 12).
Terrorism and the global economies
Other than the casualties and physical destruction which result of the attacks, terrorists inflict a grave harm to the modern economies globally. There are many ways in which terrorists harm economies. Some of them include; it reduces consumers, and firms’ expectations for the future, it forces private sector and governments to spend vast amounts of resources to security measures, hence reduce efficiency in vulnerable industries.
This redirects the investment away from productive economic uses. Terrorism has also caused consumer businesses and investors to avoid areas which are perceived to have a high risk. The geopolitical conflict triggered by terrorist may cause further economic disruptions (Setty, 25).
In reference to the data from the 2005MIPT Terrorism Knowledge Database, which has more than 20,000 incidents of terrorism, it is evident that the higher the number of terror attacks, the lower the lower the Gross Domestic Product (GDP) per Capital Growth and the lower the capital formation. In addition, when the terror attacks increase, the GDP per capita declines (Phillips 182).
The September 11 attacks in the US had a significant macroeconomic impact, and it seriously altered the outlook of a number of industries. With the US being the world’s largest importer, the world economy experienced reduced growth. The US fiscal situation worsened as a result of the attack (Lutz, James and Brenda 1525). It spent a lot resources to improve security after the incident.
There are more other negative economic consequences that impacted the US. Some of them include the demise of city centers, where significant businesses were located. The US had to move away from the global supply chain because of the increase in insecurity and screening costs. The air travel industry and tourism sector were also affected.
In combating terror terrorism, different unions with common interests have been formed worldwide. In September 2006, the member states of the United Nations Global Counter-Terrorism Strategy realized that terrorism was affecting the economies of many countries. This was the first time when all the member states agreed to develop a common strategy in combating terrorism.
Terrorism was considered to be unacceptable, and the member states took practical steps individually and collectively to stop and combat terrorism. They developed measures which include addressing the instrumental tools which make the spread of terrorism effectively, measures to stop and combat terrorism, measures to arm states to prevent and combat terrorism and measures to ensure that human rights for all countries are respected (Setty, 15).
For the global economy to grow, all barriers that inhibit its growth should be addressed. Terrorism is the worst among the inhibitors of economic growth. Nations are spending lots of money on buying effective military tools to fight terrorism. The provision of distinctive operations forces, stringent human intelligence, unmanned aerial vehicles and many others are expensive.
All these expenses pull economies back. In combating the negative effects that terrorism can cause, implementing measures against this inhuman act can do well. The measures developed by the United Nations Global Counter Terrorism Strategy can do better if implemented.
The union counters terrorism from all corners ensuring that it has put barriers that will not allow terrorism at all. Some nations have imposed new laws, which are against cases of terrorism. Without terrorism, the global economy will grow tremendously.
Jackson, Richard. An Argument for Terrorism. Journal of the Terrorism Research Initiative, 2.2 (2008): 1-20. Print
The author addresses on how the global war on terrorism is being prosecuted by the authorities. It also addresses on how terrorism is understood and dealt with as a criminal act under international and domestic law.
Lutz, James and Lutz, Brenda. “Terrorism as Economic Warfare.” Global Economic Journal, 6.2 (2006): 1524-5861. Print
The author explains the reasons that make terrorists to choose their targets. The terrorists target places preferred by tourists or places of economic value. Mostly their aim is to see the targeted nation to suffer from the economic crisis.
Phillips, Peter. “The Diseconomies of Terrorism.” The Journal of Current Economic Analysis and Policy 12.4 (2011): 171 – 192. Print.
The author explores the impact of terrorism groups to the global economies. The distribution of terror groups has been explained, and the impact of terror activities in countries where the groups are many.
Setty, Sudha. What’s in a Name? How Nations Define Terrorism Ten Years after 9/11. Journal of International Law, 33.1 (2011): 7-54. Print.
The writer addresses a significant historical gap in examining the interplay between international obligations and domestic definitions, the previously overlooked history and evolution of those definitions, and the potential rule of law issues arising from the definitions in their current form.
Young, Reuven. Defining Terrorism: The Evolution of Terrorism as a Legal Concept in International Law and Its Influence on Definitions in Domestic Legislation, International and Comparative Law Review 29.1 (2006). p. 1-47. Print.
The journal examines the evolution of the definition of terrorism at the international level. The authors compare the definition of terrorism as explained by various bodies.