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KEY FINDINGS • The

KEY FINDINGS • The total economic impact of violence to the world economy was $13.6 trillion in 2015, expressed in purchasing power parity (PPP) terms. This is equivalent to 13.3 per cent of world GDP. • The country average for the economic impact of violence is 10.2 per cent of its GDP. However, there are large differences between countries with the median being 7.2 per cent of GDP. • The economic impact of violence is equivalent to less than five per cent of GDP in 35 countries. By contrast, there are only 15 countries where the economic impact of violence is more than 20 per cent of GDP. • Countries with the highest levels of Positive Peace spend between one and two per cent of GDP on internal security. Countries with average levels of Positive Peace tend to spend more, whilst those countries with the lowest levels of Positive Peace generally spend less than one per cent of GDP on internal security. • The Syrian economy is most affected by violence, at 54.1 per cent of GDP. Iraq, Afghanistan, and Venezuela are the only other countries where the impact of violence is more than 40 per cent of GDP. • Indonesia has the lowest economic impact of violence as a percentage of GDP, at 1.98 per cent. This is largely due to Indonesia’s low levels of military and internal security expenditure. The economic impact of violence is also under 2.5 per cent of GDP in Canada, Iceland and Austria. • The total global economic impact of violence fell two per cent between 2014 and 2015. This is equivalent to $246 billion PPP. The decrease was driven by a fall in both military and external security expenditure. • Internal security expenditure, which encompasses police, judicial and prison system spending among other factors, is the second largest category. It stood at just over three and half trillion dollars PPP in 2015, which is approximately 26 per cent of the global total. • Military expenditure is the single largest category in the economic impact of violence model, accounting for approximately 45 per cent of the total figure. US military expenditure alone accounts for 12 per cent of the global total. The economic impact of total world military expenditure in 2015 was an estimated $4.46 trillion PPP. However, it has been decreasing in recent years, with falls every year from 2011 onwards. • Regionally, the cost of violence has surged in Latin America as well as in the Middle East and North Africa. Of all the regions, only North America, Europe, and Russia and Eurasia had a lower total cost of violence in 2015 than 2007. • There are vastly different impact profiles between the regions. 78 per cent of the total economic impact of violence in North America stems from military expenditure, compared to only 14 per cent in Central America and the Caribbean. Military and internal security spending is more than 50 per cent of the total economic impact in all but two regions. • Identifying the optimal level of violence containment spending is complex. No country that spends less than 0.8 per cent of GDP on internal security ranks better than 42 on the Global Peace Index. However, no country that spends more than two per cent of GDP on internal security ranks among the top 20 most peaceful countries. Spending too much or too little on violence containment does not lead to a peaceful society. • ODA targeted at security sector reform has risen substantially over the last decade, increasing 145 per cent between 2005 and 2014. However, it still comprises less than one per cent of total assistance in 2014. • Spending on peacebuilding and peacekeeping is small compared to the economic losses caused by conflict, representing respectively 0.9 per cent and 1.1 per cent of the cost of conflict in 2015. THE ECONOMIC VALUE OF PEACE 2016 | Executive Summary 4

COST OF VIOLENCE, 2015 THE COST OF VIOLENCE BY COUNTRY AS A PERCENTAGE OF GDP The cost of violence per country as a percentage of GDP >28% 20–28% 12–20% 4–12%

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