The World Through the Lens of Conflict and its Consequences

By Manav Khindri 
Illustration by Keo Morakod Ung

In the multi-faceted enigma of global affairs, conflict casts a vast, ominous shadow, leaving behind a devastating trail of despair. It is especially true today, where violent combat seems to increasingly rear its ugly head all over the world, in places such as Yemen, Gaza and Ukraine, to name but a few. Beyond the immense human suffering, these conflicts unravel global economic consequences stretching far beyond the battlefield. In exploring the economic fallout of modern conflict, we focus on the fragility of supply chains and the political implications of a bleak worldwide economic outlook, factors which emphasise just how deep the dagger of warfare can cut.

Within the increasingly globalised world of modern economies, interconnectivity and interdependence are defining features. The benefits of this system are well-documented: access to new products and markets, reduced production costs and higher levels of innovation. However, these delicate networks can easily be disrupted by any number of shocks, with conflict, in particular, posing a substantial threat.

Take, for instance, Russia’s invasion of Ukraine, which included the subsequent blocking of Ukrainian wheat exports, estimated at around six million metric tonnes. This move had a major impact, causing severe instability to the global wheat supply. By mid-2020, estimates suggested that the world had a mere ten weeks’ supply stored, sparking fears of shortages and price spikes. These kinds of disruptions reverberate across industries far beyond the agricultural sector, sowing the seeds of uncertainty and amplifying market volatility.

Looking beyond immediate disruptions, long-lasting global impacts can be even more dire. The UK’s gas price crisis over the past two years is a stark example. Though influenced by a variety of factors, its previous reliance on Russian gas before the invasion of Ukraine and the subsequent withdrawal of their supply had a profound impact. Rising prices across European economies have forced central banks into consistently raising base rates, recognising the urgent need to prevent the loss of inflation anchors. But doing so risks a major economic downturn; the UK’s recent slip into a recession has already taken its toll on consumer confidence. Meanwhile, European countries, in particular, must consider their contribution to the eventual rebuilding of Ukraine, placing further strain on the continent’s fiscal outlook.

The severe economic implications of conflict can exacerbate political issues. The situation in the UK, like most of the world, becomes complicated when attempting to confront a challenging global landscape. A pessimistic future economic outlook may serve only to divide and alienate a country unsure of whether they can trust in the nation’s leadership. In the wake of Rishi Sunak’s pledge of £2.5bn to Ukraine for 2024, the biggest annual commitment since the conflict began, questions have arisen around the prioritisation of funds by the UK government.

As those affected by such conflicts become rightly angered and frustrated by the daily horrors they witness, social unrest and discontent can, as seen in the UK, be quick to spread. While the immediate consequences of conflicts are obvious and devastating, the long-term and wide-reaching effects are not only varied, but also hard-hitting and difficult to recover from.