The Real of Global Conflicts

The world is at an inflection point, as the number of state-based conflicts is the highest since World War II. And, they are becoming more difficult to win and increasingly expensive too. Beyond the immense human suffering, conflict represents a substantial economic burden through the displacement, dislocated trade, business uncertainty and destruction of infrastructure. According to the 2025 Global Peace Index (GPI), released by the Institute for Economics & Peace (IEP), the global economic impact of violence reached $19.97 trillion in 2024, while the countries worst affected by conflict have recorded drops in GDP of up to 30% in a single year. This figure is equivalent to 11.6% of the world's economic activity (gross world product) or $2,446 per person.

Global conflicts are so much more than just headlines. They continue to cause countless casualties and widespread devastation. Beneath the obvious destruction lie the economic costs that cripple nations and communities for decades. According to the Institute for Economics & Peace (IEP) report, the economic impact of violence on the global economy in 2024 was $19.97 trillion in purchasing power parity (PPP) terms. Military and internal security expenditure accounts for over 74% of the figure, with the impact of military spending alone accounting for $9 trillion in PPP terms in 2024. In this write-up, we look at some of the main costs associated with conflicts around the world.

The global expense on terrorism reached $8 billion in 2024, down $7 billion from the previous year. This includes the cost of security measures, emergency response and economic disruption. Efforts to combat terrorism require intelligence, policing and international cooperation. Terrorist attacks cost lives, reduce investment, interrupt trade and disrupt travel.