It is no secret how many victims the terrorist acts claim. However, it is not exactly calculated, what damage terrorism does to economy. One thing is clear: terrorism has an extremely negative impact on the economic situation, but its negative impact lasts a relatively short time.
Rare individual terrorist attacks, such as bombings or murders, can have a long-term and very serious effects on the economy. The long-term effect is due to the so-called terrorist campaign, continuing for a long time, or especially large and bloody attacks, which have a significant psychological effect. The unprecedented terrorist attacks in the United States, September 11, 2001 have caused enormous damage to the economy of the United States and around the world, but the negative trend caused by the terrorist attacks lasted no more than two or three months. Terrorists have slowed economic recovery in the United States, but their actions were not the cause of the economic problems.
The terrorist attacks caused damage similar to that caused by “ordinary” criminals, natural disasters, man-made catastrophes and epidemics. Mankind has long learned to cope with their effects.
Economist Benjamen Zicher believes that the greatest damage terrorism does not damaging or destroying property, but creating an atmosphere of fear and uncertainty. It is the psychological aspect of terrorist attacks is the main cause of economic turmoil occurring in your community.
Every terrorist attack gives the impression that such attacks would continue.
First of all, it has an impact on a business that puts some investment in this city, region or country and initially tries to include in the price of their products or services an additional risk fee, which leads to a decline in business activity and higher prices. The fear of terrorist attacks also makes business to spend more funds on ensuring its own security, making smaller, less productive investment.
The Islamists activity in Algeria in 1996-2001 cost the country $16 billion. After Palestinian gunmen carried out a series of terrorist attacks in Kenya, Kenya was faced with the exodus of tourists. Every year tourists gave this country about $500 million, but after the attacks, the tourism industry’s losses about $1 million a day. Similar processes have been observed in Indonesia after the attack in Bali. After terrorists attacked in Yemen the French tanker Limburg, insurance company twice raised rates for vessels calling at the port of Aden. In fact, the cost of call in Yemeni ports increased for each ship for $150 k, with the result that shipowners have to choose other itineraries for their ships. As a result, the turnover of Yemeni ports decreased by half, with the monthly losses amounted to $3.8 million.
Many economists believe that it is due the activity of the Basque terrorist that the Basque country is the least economically developed region of Spain. Economic growth rates in Basque 10% lower than the average for Spain. In Colombia, in which there are several active terrorist groups, foreign investment has become a rarity, and the standard of living of the population is 45% lower than the average for Latin America.
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