It is not that anyone doubts it or does not know it, but just in case the International Monetary Fund (IMF) has issued a worrying alert: there have never been so many armed conflicts in the world since World War II. It is the notice that the organization has published, in which it ensures that the widespread number of wars is having a very negative impact on the global economy.
According to the estimate made by the IMF, more than 35 countries are currently immersed in some type of conflict, which affects about half of the world’s population. Of course, the multiplication of wars and geopolitical tensions, warns the IMF, has a notable effect on the increase in military spending. This may boost economic activity in the short term, but it worsens inequality and inflation.
As reported in BloombergFor example, about half of the countries have had to increase their defense budgets, with arms sales currently being a sector that has doubled its numbers in just a few years. However, this rise in arms spending brings enormous pressure on public debt and the availability of less money for social investments such as education or health.
The IMF has warned that the GDP of countries involved in conflict usually falls by around 10% in five years, a decline whose consequences can be felt for decades; That is, a war can be worse, in economic terms, than a financial crisis or the accumulation of environmental disasters.
The problem is that the situation does not seem to improve, but rather worsen. You only have to look at what is happening in the Middle East, where there are more and more actors involved. In this war promoted by the United States and Israel, global problems can already be seen, especially in the supply of oil or gas, which has raised the prices of absolutely everything in all parts of the world.
Because the effects of wars are not only noticeable in the countries involved, but also in the rest. Ultimately, in a globalized world, it is difficult, if not impossible, to escape problems in supply chains, the price of basic goods or increased investment uncertainty. This has been noted with greater effect in countries in Africa, Asia or Latin America, where they depend heavily on imports of energy and raw materials, which in turn raises concerns about greater social tensions.
And what does the IMF propose? Well, first the end of wars to maintain global financial stability, but also for countries to begin to plan their public finances much better, trying to balance defense spending with social spending. And prepare for decline, or undoubtedly slower growth.
