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PEACE

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REGIONAL COMPOSITION OF

REGIONAL COMPOSITION OF ECONOMIC IMPACT OF VIOLENCE The economic impact of violence by type of expenditure is not evenly distributed across regions, with large variations in both the magnitude of expenditure and its composition. North America accounts for 30 per cent of the global economic impact of violence, which is almost entirely attributed to the United States. The next largest regional share comes from Asia-Pacific, which was dominated by China, contributing 17 per cent. This is notably higher than Europe and MENA which both account for 12 per cent of the total. FIGURE 16 REGIONAL ECONOMIC IMPACT OF VIOLENCE AS A PROPORTION OF THE GLOBAL TOTAL Developed regions incur high economic impacts from violence and conflict due to higher spending on military and internal security. North America Asia-Pacific Europe MENA South Asia South America Russia and Eurasia Central America and the Caribbean Sub-Saharan Africa 4% 4% 5% 6% 9% 12% 12% 17% 30% 0% 5% 10% 15% 20% 25% 30% 35% Figure 16 illustrates regional costs as proportion of the global economic impact of violence. Source: IEP PERCENTAGE OF GLOBAL ECONOMIC IMPACT In terms of the composition of costs, there are large differences between regions. Most of the costs in North America, Asia-Pacific and Europe are due to military and internal security expenditure whereas sub-Saharan Africa and Central America and the Caribbean suffer more economically from the burden of interpersonal violence. The highest proportion of military expenditure was in North America, where it accounts for 78 per cent of the total economic impact. Europe spends the most proportionally on internal and private security, accounting for 56 per cent of the economic impact of violence. In contrast, Central America and the Caribbean has the highest proportion of expenditure related to interpersonal violence, at 57 per cent. The economic impact of homicide in Venezuela and Honduras is the equivalent of 36 and 30 per cent of GDP respectively. Losses from armed conflict represent the smallest component of the four categories shown in figure 17. FIGURE 17 REGIONAL PER CAPITA ECONOMIC IMPACT OF VIOLENCE BY SPENDING TYPE, 2015 The composition of the economic impact of violence varies greatly across the regions of the world. PROPORTION OF PER CAPITA ECONOMIC IMPACT BY REGION 2015 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 6% 0% 16% 78% North America 11% 6% 18% 1% 33% 34% 50% 48% 28% 13% 22% 24% 2% 38% 37% MENA Asia-Pacific South Asia Russia and Eurasia 16% 1% 38% 56% 28% Europe 43% 2% 32% 23% Sub-Saharan Africa 55% 57% 0% 25% 20% South America 2% 27% 14% Central America and the Caribbean Military Internal Security Armed conflict Violent crime Source: IEP THE ECONOMIC VALUE OF PEACE 2016 | Results & Trends 24

TRENDS IN THE CATEGORIES OF VIOLENCE CONTAINMENT Homicide Homicide accounts for 13 per cent of the global economic impact of violence and has increased eight per cent between 2007 and 2014. However, it decreased seven per cent in the latest year, mainly decreasing in advanced economies. Regionally, South America, Central America and the Caribbean and sub-Saharan Africa are the most affected by economic impact of homicide. Seven out of the ten countries with the highest economic impact of homicide as a percentage of their GDP are located in Central America and the Caribbean or South America. Venezuela, Honduras, and El Salvador incur the highest cost of homicide as proportion of their GDP reflecting the very significant burden that interpersonal violence and organised crime has on the economic health of these countries. TABLE 5 TEN COUNTRIES WITH HIGHEST COST OF HOMICIDE AS PERCENTAGE OF GDP Seven out of the ten countries in the world with the highest homicide rates in the world are located in Latin America. COUNTRY TOTAL COST OF HOMICIDE AS % OF GDP Venezuela 36% Honduras 30% Lesotho 22% El Salvador 14% Colombia 14% Jamaica 14% South Africa 13% Guatemala 12% Dominican Republic 9% Swaziland 9% Source: IEP FIGURE 18 HOMICIDE AS A PROPORTION OF THE REGIONAL ECONOMIC IMPACT OF VIOLENCE The economic impact of homicide is the highest in South America, followed by Central America and the Caribbean. South America Central America and the Caribbean Sub-Saharan Africa Russia and Eurasia South Asia MENA Asia-Pacific Europe North America 0% 10% 20% 30% 40% 50% 60% HOMICIDE AS PROPORTION OF REGIONAL ECONOMIC IMPACT OF VIOLENCE Source: IEP THE ECONOMIC VALUE OF PEACE 2016 | Results & Trends 25

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