How war and arms sales are exacerbating global poverty

Poverty has many roots, and it has many causes. but among those causes, war and arms sales are one of the greatest obstacles to development and poverty reduction. War and arms trade may have fattened the pockets of some businesses and individuals, but millions have been plunged into poverty. Social scientists and economists argue that once a country experiences conflict, it faces a reversal of economic development, because when a war or armed conflict begins, its consequences extend far beyond human casualties. Wars directly destroy homes, hospitals, businesses, schools, infrastructure and other national resources worth billions of dollars, resulting in low or negative economic growth, increasing unemployment which in turn creates poverty and widens income inequality.

According to the Institute for Economics and Peace (IEP), the estimated economic cost of armed conflict, war and violence to the global economy in 2020 was USD 14.96 trillion—in purchasing power parity (PPP) terms. This figure is equivalent to 11.6 percent of the global GDP.

Today, in nearly 50 conflict zones around the world, some one and a half billion people live under the threat of violence. These countries are spending up to 59 percent of their GDP on the effects of violence. Syria, with its ongoing civil war, suffered the greatest economic impact with almost 60 percent of its GDP lost to conflict in 2019, followed by Afghanistan (50 percent) and South Sudan (46 percent). From Syria to Yemen, Haiti to Mali, South Sudan to Venezuela, Afghanistan to Myanmar—political crises, war and armed conflicts have forced millions to flee their homes.

According to the United Nations High Commissioner for Refugees’ (UNHCR) Global Trends Report, by the end of 2020, more than 8.24 crore people fled war or persecution. The report also confirms that just five countries make up more than two-thirds of all refugees: Syria (68 lakh), Venezuela (54 lakh), Afghanistan (28 lakh), South Sudan (22 lakh), and Myanmar (11 lakh). These displaced people are forced to seek safety in neighbouring countries, where they live in makeshift camps in horrible conditions, often struggling to meet basic needs like health, education, food, housing, water and sanitation, to name a few.

Today, about 9.2 percent of world population—about 68.9 crore people—live in extreme poverty on less than USD 1.90 a day, according to the World Bank. Among the 17 Sustainable Development Goals (SDGs), ending extreme poverty by 2030 are part of a comprehensive global agenda, but these intensifying wars, armed conflicts and violence are suggesting that the global target of ending extreme poverty by 2030 will be missed by a large margin. New research estimates that the number of people living in extreme poverty is expected to rise to about 75 crore by the end of 2021. Meanwhile, projections by the World Bank, the Organisation for Economic Co-operation and Development (OECD), and others estimate that by 2030, 50-64 percent of the global poor will live in countries affected by fragility, conflicts, and high levels of violence. Today, only a handful of economically and politically powerful global elites are setting the rules of the world. For the past several years, these powerful nations have been preaching “world peace,” but the question remains: Do they really practise what they preach?

Take the United States for example, the world’s leading economic power. Since its birth on July 4, 1776, the country has been at war for 93 percent of its existence. While they try to be noble by claiming that they have entered wars because they are “fighting for justice,” “for democracy,” or “fighting against terrorism and dictatorship,” the entire world knows what the real motive underlying these wars and conflicts is, and who the beneficiaries of these wars are.

According to new data released by the Stockholm International Peace Research Institute (SIPRI), arms sales by the world’s 25 largest arms-producing and military services companies (arms companies) totalled USD 361 billion in 2019. That year, the top five arms companies were all based in the United States: Lockheed Martin, Boeing, Northrop Grumman, Raytheon, and General Dynamics. These five companies together registered USD 166 billion in annual arms sales. In total, 12 US companies appear in the top 25 for 2019, accounting for 61 percent of the combined arms sales of the top 25. These companies have benefited tremendously from the growth in global military spending. SIPRI noted that world military expenditures in 2020 totalled USD 1.981 trillion.

The five biggest spenders in 2020, which together accounted for 62 percent of global military expenditure, were the United States, China, India, Russia, and the United Kingdom, according to SIPRI. With a military budget of an estimated USD 778 billion, the US remained the world’s largest spender in 2020, accounting for 39 percent of global military spending, followed by China (USD 252 billion, 13 percent), India (USD 72.9 billion, 3.7 percent), Russia (USD 61.7 billion, 3.1 percent) and the United Kingdom (USD 59.2 billion, 3 percent). In 2019, the combined military expenditure of the 27 EU member states was 186 billion euros.

In the wake of the terrorist attacks on September 11, 2001, the United States launched an international war on terrorism. A report from the “Costs of War” project at Brown University revealed that 20 years of post-9/11 wars have cost the US an estimated USD 8 trillion, and over 929,000 people—including US military members, allied fighters, opposition fighters, civilians, journalists and humanitarian aid workers—have died as a direct result of war. The report also confirms that the US post-9/11 wars have forcibly displaced at least 38 million people in and from Afghanistan, Iraq, Pakistan, Yemen, Somalia, the Philippines, Libya, and Syria. This number exceeds the total displaced population by every war since 1900, except World War II.

Given the world’s present circumstances, it does not seem to be a very nice place right now; there is too much hatred, conflict, war, double standards, and hypocrisy. It is really unfortunate that while trillions of dollars are devoted to killing people, there is much less money spent to keep people alive. The United States spent USD 2.26 trillion on its war in Afghanistan. Spending that kind of money in any country should have lifted most people out of poverty, but sadly, in 2020, 47.3 percent of the Afghan population still lived below the national poverty line.

Let’s recall that world leaders once committed to “end poverty in all its forms everywhere” by 2030, and we’re just nine years away from that deadline. Interestingly, the SIPRI report said that military expenditure amounted to 2.3 percent of global gross domestic product—and 10 percent of that money would be enough to fund the global goals agreed upon by the United Nations to end poverty and hunger by 2030.

Therefore, if the world’s so-called “saviours” really want to achieve the goal of eradicating extreme poverty from the world and establish peace and prosperity, then they must stop war and oppression now, and change their mindset, attitude and policies in ways that may reduce international tensions. They need to understand that war will never bring peace and prosperity to the world; it just adds up to the hatred and enmity among the nations and hinder efforts to combat poverty. Extreme poverty in our world could quickly become a thing of the past if only some of their monstrous military budgets could be diverted towards humanitarian goals, investing in infrastructure like building schools, hospitals and skills development institutions in countries that are struggling.

Abu Afsarul Haider is an entrepreneur. 

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