Paris Perspective #31: War, peace and the future of the global economy – Steve Killelea

Paris Perspective #31: War, peace and the future of the global economy – Steve Killelea

RFI English
00:23:42
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About this episode

Paris Perspective looks at the state of peace in the world in 2022 on the occasion of the publication of the 16th Global Peace Index. Steve Killelea is the founder and executive chairman of the Institute for Economics and Peace, which publishes the Index.

The 16th edition of the Global Peace Index was published this week. Data from the Index shows that, on a world-wide scale, military spending has fallen. 

However, expenditure on the military in China, US and Iran has increased.

Yet despite the ongoing war in Ukraine, the index shows that Europe is still the most peaceful region in the world.

Ironically, the situation regarding violent protests worldwide has deteriorated. According to the index, the world is actually 0.3 percent less peaceful even though military expenditure has gone down.

When broken down economically, the impact of violence on the global economy in 2021 was $16.5 trillion, or $2117 per person on the planet.

Paris Perspective spoke to the Australian philanthropist and two-time Nobel Prize nominee who founded the Institute for Economics and Peace and the Global Peace Index, Steve Killelea

With war in Ukraine, the European continent is no longer a peaceful place and the once "braindead' North Atlantic Treaty Organization (NATO) has been rejuvenated by Putin's invasion.

The resurrection of NATO

It is reckoned that NATO's expenditure will rise by seven percent in the next couple of years to $38 billion by 2024.

Meanwhile, the fact that Europeans are coming to terms with a war of attrition on their soil in the face of an aggressive Russian behemoth casting a shadow across the continent, which is, in turn, driving an existential shift in NATO's relevance in the 2020s, is generally seen as a good thing. 

But is it a good thing for global security? 

For Killelea, the overall budget will definitely have an effect in North America if NATO's military spending goes up seven percent, "but I don't know how much of an effect that's going to have on other parts of the world."

"If you look at Latin America, in South America, well, it's probably different," he says.

"[But when it comes to Africa] it'll vary from country to country. Countries in the Sahel, which are particularly challenged through terrorism, we'd expect in a number of those countries to see increases [in military spending] as well." 

What about Asia with end of the war in Afghanistan? "In many ways, we'd expect to see some decreases in military expenditure there. But for India, that may be different, because it's got issues with China," he explains.

"It's difficult to actually make a prediction going forward on how this is really going to affect global expenditures on the military. But certainly, we do need a strong military to be able to defend our countries, but every extra dollar we spend - which we don't need on the military - can be more productively invested elsewhere.

"So understanding these balances is very, very difficult." 

The impact of Covid-19

What has been easy to understand in 2022 is how the conflict between Russia and Ukraine has triggered fundamental changes in defence postures and policies, supply chains and food security. What needs to be clarified is how long it will take to adapt and move away from dependency on Russian oil, gas and grain exports.

Killelea also reminds us that we can't forget the impact of Covid on the world's trading networks.

"We've got all the issues coming out of Covid," he tells RFI. "The supply chains haven't been fixed. We've then seen China, particularly Shanghai go [back] into lockdown, which has further exacerbated a whole lot of supply chain issues, which again, underpin inflation.

"Then on the back of that we've now got the Ukraine war, which has turbo-charged those inflationary pressures and supply shortages."

Killelea is certain that these factors are not going to disappear within the next two years.

"But the real factor," he says "is inflation, and what that's going to do to global economies -  particularly in terms of turning them into [economies in] recession.

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"If we look at global debt - and I don't know the figure today - but if you went back six months ago, it was 246 per cent of global GDP.

"That's all private debt, government debt, and business debt...

"Now with inflation running at eight percent - and it's probably gonna go higher when we just look at the shortages currently - where do the interest rates end up and how well, can the economies cope with that?"

Then there's the political instability all this creates.

"Political instability is the highest it's been since we started the Global Peace Index 16 years ago. And obviously, part of that is fuelled by the Ukraine. But it's also fuelled by North Asia and the tensions with China and a number of its neighbours.

"And violence against citizens. That's at the highest it's ever been. Violent demonstrations [are] at record highs as well," he says, adding that along with the confluence of economic and human rights issue, there are 88 million refugees now: "That's the highest...in the last 16 years as well."

Russia, China influence in Africa

And there are also shifting sands in zones of influence. When it comes to peace on the African continent, Russia's renewed interest in countries such as the Central African Republic and Mali - which were traditionally French and within France's remit - are now turning to Moscow, much to the annoyance of Paris. 

"We can see the Wagner group...pulling its troops out [of Africa] and using them now in Ukraine. We see that in the Central African Republic, they organised a group of mercenaries from there to come over and fight for Russia," he says. 

"That may change as Russia's economy is going to be much more restricted than it has been in the past. So it's going to be a lot harder for it to fund groups like Wagner," Killelea remarks, however he believes China may step in and fill in some of the gaps.

"China in the last year appointed a peace envoy for the Sahel so we need to see how that develops over time. That may be a good thing or it may be bad thing - we don't know yet."

China is starting to step up on the "adviser side of cooperation", but Killilea says he finds it "very hard to imagine that [China] will actually put troops on the ground at this stage in the Sahel. But I could see them putting technical experts in there to help with advice".

Social media and 'real-time intelligence'

It is the development and accessibility of technology and the power of social media that have really underlined the shift in how war is fought in the 2020s.

Witnesses film events in real time and post them directly onto social media platforms. This begs the question: has modern warfare become more accessible and therefore cheaper to execute?

Killilea says the answer is twofold, depending on what level of warfare you are talking about. 

" [On one hand] in a lot of parts of the world for $20, $40, $200 - you've got yourself a really lethal weapon," he says.

"On the other hand, what we're seeing - and we can see it with the Ukraine trying to get at the Russian artillery pieces which are shelling them - they need really sophisticated, long range missiles. They're very expensive and very hard to get and they're relying on the US to supply them with it.

"So at one end, one can say the answer is yes. At the other end, not so much so."

But one thing the Ukraine war is demonstrating is the change in the way intelligence is gathered.

"When you see a tank coming down the street – you ping it on social media, then a bomb goes off somewhere," he says.

"Now you see some artillery - now you've got the ability to put that up on social media.

"That gets shared instantaneously and in real time. It's unfiltered. It's raw.

"So in terms of intelligence and intelligence gathering, that's vastly different to what it would have been even a decade ago."

"Then," Killelea concludes "you'd have some central body collecting it, then filtering it to make sure it's right, then disseminating it... and that was quite often well after the event."

Watch full video here.

Written, produced and presented by David Coffey.

Recorded and edited by Nicolas Doreau and Vincent Pora.

Steve Killelea is an Australian philanthropist and two-time Nobel Prize nominee who founded the Institute for Economics and Peace and the Global Peace Index