Since the 21st century has begun,
several terrorist attacks occured all over the world and in 2015, it became common to hear about a tragic barbaric act caused by the
growing power of some extremist religious groups which are aiming to
impose their ideology on everyone. The purpose of those attacks is to
conquer inhabited land in order to rob and destroy them by using
radical and violent ways, similar to what the Nazis tried
to do 75 years ago.
Terrorist groups also want to destabilize the
economic system of The West by spreading panic in political opinion,
reducing household consumption and destroying transport
infrastructure.
Economic
repercussions of 9/11
It is hard to estimate clearly the economic impact of
the 9/11terrorist attack, however most economists claim that it
was significant. First of all, the financial system of Wall
Street was obviously interrupted for a while and the huge amount
of casualties weaked the potential of the American financial
system. Beyond the tragic casualties, the american population reeled from the shock and, the 2001 third quarter was an
absolute disaster for the economy (while it is usually the most
favorable one) insofar as the household consumption fell heavily and
some investment and equipment projects were postponed for later.
Psychological and technical reasons explain that : The cost of
security, control, surveillance in order to enforce the safety of
the economic operators also put a brake on some initiative.
France
gets into a mourning and fear period
Three days after the woeful incidents occured in France,
the whole nation was in mourning, and while the minister of finance
Michel Sapin announced just before the terorist attack a growth
of 1% for the French GDP in 2015, economists are now worried about the
economic situation of the country after what happened. France and
especially Paris has been the biggest tourist destination for a long
time and tourism is contributes to 8% of the french GNP and the country
welcomed 83.7 millions visitors in 2014. The fact that the city of
love suffered was attacked twice in 2015 will obviously make tourists more reluctant about visiting the country.
« We are worried about the hospitality sector »
said Evelyn Maes chairman of the UMIH75 « We fear that the
foreign customers who are usually coming for christmas won't be here
this year ».
French people are also really scared and do not dare to
go out, «I never seen Paris that calm, there is nobody in the street
and some shops do not even open» said a witness interviewed this
morning in the capital city.
As the U.S governement did d in 2001, the french government
will probably invest money in security and surveillance especially in
transport infrastructure and cafe/bars which are the main target of
the terrorists. The amount of money needed to increase safety is high and usually it exceeds the basic budget especially when it
comes to an unforeseen situation like that.
A short
term slump
Economists confirmed that right after an unexpected
terrorist attack, the economy of the country suddenly slows
due to all the causes quoted above, and the main problem is usually the
consumer spending . However the slump in the economy
never lasts long, After 9/11 the american economy came back on
track in less than a year and improved the consumption quickly
thanks to the motivation of the American population always ready for helping the country when it is needed . That is also why Washington has spent over than 100
billion dollars for five years for the safety of the population
and in order to bring down the « subprime credit » and boost demand .
In Europe neither the 2004 terrorist attack (in Madrid)
nor the attack of Charlie Hebdo in early 2015 (Paris) had a real
impact to the economy of each country, except during the days after the incident and economists are confident. But in contrast to
the U.S.A, France does not have good opportunities of credit
and owes a lot of money to its creditors (predominantly countries of
the European Union) in addition, the french unemployment rate is still
high (11%).
Swan
Domergue
Hello Swan,
ReplyDeleteI was almost certain that you would write your article about that current topic. I found it interesting, especially to know the economic consequences and repercussions of such events, even if we do not have many figures to illustrate them.
However, I have some objections to make, but don’t take it amiss!
On the one hand, I expected to read an article about the economic reasons that terrorists claimed (and still do) through such attacks, as you titled your article “when barbarity goes with economy”. In your opinion, do you think there is a link between barbarism and economy? If yes, do you have any information about that?
On the other hand, I found that surprising the “transition” you made between your first and second part, without contextualizing the previous month events. You’ll tell me that everybody knows what happened last month, but I think it would have been better to write a few words about that, especially if you read this article in a few years.
Nevertheless, it is a tricky topic to deal with, so well done for not having taken sides and explained it from a neutral point of view.
Sorry I forgot to sign : Margo V.
DeleteThank you for your comment Margo !
DeleteTo be honest with you, it did not come threw my head to talk about what Daesh is and how they also contribute to the world economy, but for sure it is a really interesting subject. Yesterday, I have watched a documentary about that actually, and if I knew it before, I would definitly talk about it. To answer your question yes, there is a link between economy and terorism, Daesh is currently chairing huge oil and weapon company and they sell it to many countries including France and USA. Daesh became a really rich state and economist a specialist are wondering themselves how a countrey which does not phisically exist could make a huge amount of money (1,8 billion if my memory is right) in less than a year. All these attacks allow them to become much more powerful therefore richer.
I recommend you to watch the documentary "Un jour dans l'histoire" which is giving plenty of infomation about it
Hi Swan,
ReplyDeleteInteresting article indeed, but I would like to discuss one of your argument which support that terrorists are trying to destabilize the economic system. I am agree that Al Qaida tried to paralyze the american economy by targeting the World Trade center but i am not certain that what happened in France had something to do with the economy. If they wanted to they could have attack other places than pubs or a concert hall. I would like to have your opinion on this.
Thanks
This comment has been removed by the author.
DeleteHello Swan,
ReplyDeleteI find it interesting reading about economic impacts after terrorist attacks. Your article made me realize the fact that we always wait for the bad thing to happen to act.
I mean that we already knew about the Islamic state activity with oil and its ideology. I find it sad that we let them trade and develop their economy and we only react once it is "too late".
I guess it is difficult to counter such a movement, and I'm not saying I could have done better to prevent this event, I'm sure the government did its best.
Do you think we should be more agressive towards such organisations when we're aware of the potential danger they represent -without waiting for such a drama to happen-?
Thomas C.
Well, I always said that violence does not solve any problems. However right now, insofar that these terrorist groups are really purposeful about imposing their ideology and they will still kill to do it, I do not see any other way but attacking them to stop those awful terrorist attacks. However, I also think that if powerful countries (such as France, America....) stop to buy oil from Daesh and stop to sell weapon to them, we could begin a boycott. Therefore we wont contribute to their growth.
Delete