Introduction
Economic Risk Factors
Methods of Risk Avoidance Introduction Economic development is important not only for preventing conflicts, but also in post-conflict settings. Collier and Hoeffler found that the higher the level of per capita income, the lower the risk of conflict. Hence, economic development is paramount for the prevention of future conflict and for post-conflict societies to avoid relapse into violence. Civil war is common in low-income countries, and deteriorates the already dismal state of the economy of these countries even further. Thus, the transition periods following conflicts are unstable, not only from the socio-political point of view, but also in economic terms. Yet economic stability is an important feature in securing long-term political stability and reconciliation. It is paramount for the constitution of a legitimate government that is equipped with sufficient financial flexibility to restore infrastructure and to create a social safety network. The transition period from violent conflict to peace is characterized by an unnatural demographic distribution of the population. Large numbers of refugees and displaced people often cluster in parts of the country where the land does not provide sufficient nutrition, and they are left with nothing to do. This can lead to relapse into conflict as former combatants or refugees revert to violence to secure their basic needs. When peace is finally established the country and its economy are exposed to an often large influx of people, who had fled across the borders during periods of violence. This influx further aggravates the social and economic tensions. Economic Peacebuilding has to target the micro- and macro-level. Basic needs of the population have to be met. Economic opportunities have to be created to employ the large amount of idle labor. On the macroeconomic level, the post-conflict government should be assisted in its efforts to secure the economic foundations for viable transition to peace. Economic recovery can only be achieved in the long-term. It is a complex process, during which strategies have to be harmonized in ways such that they do not contradict each other or undermine efforts in different areas of post-conflict Peacebuilding. Economic Risk Factors Certain economic realities can potentially lead to recurrence of violence and relapse into conflict if not taken into consideration. - Lack of Opportunities: Conflicts have severe destructive effects on a country's economy, leading to a contraction of economic opportunities. Young men and former combatants are particularly vulnerable under these conditions. Left without anything to do, they are at risk to return to their former employers-– army, warlords, rebel leaders-– in search for employment. In some cases these men are recruited as security forces for former warlords, who seized large properties or power over natural resources. In other cases they are recruited by rebel leaders, who are dissatisfied with the peace-agreement and try to destabilize the new government through land raids and terrorist acts.
- Food Scarcity: In situations where conflicts led to a break down of food distribution sentiments of hopelessness caused by lack of economic opportunities are further aggravated. Refugees are often stranded in overcrowded camps. Access to arable land might be restricted for members of ethnicities or population groups that have been driven out of their homelands. Again, those affected by these circumstances are vulnerable to recruitment efforts by warlords or rebel leaders, who can promise food and shelter or the recapturing of native soil in return for military services.
- Landmines: In many cases landmines further restrict access to arable land, due to extensive use of landmines during conflicts. Landmines are a hindrance not only to timely resumption of agricultural production but also to transportation of goods, as demining of roads and fields becomes necessary. Demining is an expensive and cumbersome process that uses up large amounts of post-conflict reconstruction assistance.
- Natural Resources: Countries dependent on natural resources are often more conflict prone. In post-conflict situations the redistribution of control over natural resources can become the cornerstone for economic recovery. According to Collier rebel activity and political rebellion can be caused by natural resource rents. Any settlement remains unstable as long as the fight over resources is more profitable than peace. For rebel groups, like the Columbian guerilla, extraction of resources not only provides means for rebel activity but also constitutes the objective thereof. Rents are used to pay for arms and soldiers to protect the production sites. Political leaders in resource-rich regions are more likely to mobilize the population for secession than leaders of poorer regions which are dependent on transfers from the central government authorities.
- Aid: Foreign aid, while necessary, is at the same time a potential risk factor in the absence of appropriate institutions that guarantee the distribution of aid into the right channels. While aid is necessary to meet basic needs of civilians and victims of conflict, it is often abused by government or rebel forces to invigorate their soldiers and build up their arms supplies. Thus, aid can prolong conflict. (Case Study: Sudan)
- Donor Fragmentation: The absence of multilateral donor coordination can frustrate good macroeconomic management and lead to sectoral mismatches. Furthermore, the often weak post-conflict authorities in the recipient country become overburdened with the administration of aid that comes from a large number of different sources. Bilateralism can lead to political and economic exploitation of both the internal division among recipients by the donors and the fragmentation of donors by the beneficiaries.
Methods of Risk Avoidance - Economic Opportunities: Economic growth brings employment opportunities, but peace is not automatically accompanied by economic recovery. As a strategy which brings more immediate effects, expansion of primary and secondary school enrolment should be considered. It increases future income-earning opportunities and has a so called "jail effect" on child soldiers and young combatants. While in school, they are less likely to be recruited for rebellions.
- Micro-finance: International donor agencies can help create opportunities for economic activity and employment on a local level through the establishment of micro-credit institutions, which lend capital to people who do not have access to bank loans or other instruments of institutional financial markets because of stringent credit requirements.
- Local Ownership: Investment at the community level is needed for the success of development. Thus, money freed by cutting military expenses should be re-invested to strengthen social institutions and civil society. A solid economic base at the local level can facilitate re-integration of former combatants.
- Food and Land Distribution: Providing for basic needs and establishing food security in post-conflict countries is paramount in terms of laying the foundations for peaceful transition. The relocation of the displaced population into arable regions and equitable distribution of land between former adversary groups is not only necessary for economic recovery, but can also positively influence reconciliation.
- Aid: Burnside and Dollar have proven that aid and policy are complementary. In low income countries aid is necessary to spur economic growth. It intensifies the effects of government policies and policies augment the effects of aid. International donor agencies can positively influence the effects of aid if they exert pressure on post-conflict governments to adopt good policies; policies that guarantee that money are used for long-term economic recovery rather than for just short-term gains.
- Control over Natural Resources: Diversification of the economy cannot be established in the short-term. One approach to avoid control over natural resources persisting as an immediate cause of violence is to concede some control over resource rents to rebels - although this will hardly prevent relapse into conflict in countries where more than one rebel group fight over resources that are too scarce to satisfy all groups' demands. The government can also undermine support for rebel movements or secession by returning the proceeds from natural resources to benefit the entire population. Transparency and balanced distribution of rents to as many beneficiaries as possible decreases the threat of future conflict by decreasing dissatisfaction among the population over the way rents are utilized by the government. The international community has the potential to eliminate this risk factor as a conflict cause by denying market access to those who use natural resource rents to prolong conflicts in their respective countries.
- Macroeconomic Framework: Economic recovery calls for sound macroeconomic policies. International organizations provide budgetary support to post-conflict governments and assist in the restoration of financial institutions and appropriate legal frameworks. Investment guarantees can be instrumental for the recovery of key economic sectors and the return of expatriate expertise.
- Social Safety Network: The creation of a social safety network is a long-term strategy. Social security provides individuals with economic independence and prevents discontent and social tensions from re-emerging in society.
|
