A small campfire, if left unattended, can spread its flames to nearby brush and trees, eventually growing into a much larger and harder-to-control blaze. Similarly, armed conflicts in Africa often start as localized issues but can quickly spread across borders, impacting neighboring countries and their economies. These conflicts, once ignited, have a troubling tendency to expand, engulfing not just their origin sites but also spreading instability and economic challenges to neighboring territories.
The Growing Blaze of Conflict in Africa
Africa has recently seen a surge in armed conflicts and coup attempts, particularly in the Sahel region since 2020. The number of conflict incidents and fatalities has spiked dramatically in recent years. In 2022, fatalities were more than five times higher than in 2010, and conflict incidents had increased tenfold over the same period. While all types of conflict have escalated, violence against civilians has been the most predominant, with a marked increase in the involvement of rebel groups since 2018.
These conflicts are primarily concentrated in border areas that often lack public service provision, creating ungoverned spaces. Notable examples include the civil war in Ethiopia, the long-running conflicts in South Sudan and the Central African Republic, and extremism-driven conflicts across the Sahel and northern Mozambique. Such hotspots pose substantial risks to security and stability, both within the affected countries and in neighboring states.
Conflict Flames Travel Across Borders
These conflicts spread beyond national borders like an expanding fire, impacting surrounding areas. The new Conflict Spillover Index (CSI) highlights this trend, showing that conflict spillovers have been rising, turning neighboring regions into zones of instability and economic turmoil. This index combines various elements, such as fatalities, incidents, and geographic proximity, to provide a comprehensive measure of conflict spread. It reveals significant cross-country heterogeneity, with the Sahel region experiencing some of the most severe spillovers.
The CSI indicates that conflict spillovers in Sub-Saharan Africa (SSA) have increased significantly since 2011. Conflict acceleration in the Sahel coincided with the Libyan civil war and began with an outbreak of violence in Northern Mali. Initially restricted to Northern Mali, this conflict spilled over into Burkina Faso, Niger, and Nigeria. Since then, the Sahel has evolved into a conflict hotspot, where various conflicts reinforce one another.
Another notable finding by the index is that resource-rich countries in SSA exhibit a higher tendency for conflict spillovers compared to their non-resource-intensive counterparts. This pattern suggests a correlation between the abundance of natural resources and an increased likelihood of conflict spillover, as competition and disputes over valuable resources often contribute to regional instability.
The Economic Cost of Next-Door Conflict
An empirical analysis of the effects of a surge in conflict in neighboring countries reveals significant and persistent negative impacts on the home country. An increase in conflict abroad can lead to slower economic activity and higher inflation domestically. It is also associated with increases in government spending, public debt, and imports in the home country. These findings indicate that countries affected by conflict spillovers face substantial fiscal and external challenges. The negative effects on output and revenue shortfalls are more pronounced in countries with less effective governance and limited fiscal space, highlighting their limited capacity to mitigate the impacts of conflict spillovers. In contrast, increases in government expenditures are primarily observed in more effective governance contexts, reflecting a proactive response to counteract the negative impacts of neighboring conflicts.
Containing the Blaze
Considering these findings, several policy implications emerge, akin to strategies firefighters use to contain a wildfire. First, there is a pressing need for fiscal prudence and the establishment of fiscal buffers to appropriately respond to the spillover effects of conflict shocks. Just as firefighters create firebreaks to prevent the spread of flames, countries must build financial resilience to manage the economic instability brought about by these conflicts.
A coordinated response is essential to address externalities, particularly in regions with porous borders and cross-border communities. Collaborative efforts among neighboring countries can help manage and mitigate the spread of conflicts, ensuring that instability does not cascade further, much like firefighters working together to contain a fire.
Improving governance can significantly mitigate the negative spillover effects on growth. Effective governance reduces the vulnerability of economies to external shocks, like maintaining defensible space around critical areas to protect them from fire. However, the findings also indicate that higher spending and debt levels in more effective governance settings suggest these countries might face challenges as they attempt to put the fire out.
Increased efforts by development partners are crucial to finance initiatives that can attenuate the spillover effects of conflict. This support is vital to prevent the spread of conflict from neighboring countries to those affected by spillovers. Development partners can play a key role in providing the necessary resources and expertise to strengthen regional stability and economic resilience, akin to deploying additional firefighting resources to areas most at risk.
Conclusion
Conflict spillovers in Africa present a complex challenge with significant economic implications. By understanding the dynamics and impacts of these spillovers through our new Conflict Spillover Index (CSI), policymakers and stakeholders can better address the root causes and effects. Effective governance, fiscal prudence, and coordinated regional responses are essential to mitigating the adverse impacts and fostering stability in the region.
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