Six Countries in Middle East Lose $35 Billion Due to War

The continuing civil war in Syria and the Islamic State run across both Iraq and Syria have caused a loss of $35 billion in neighboring countries, according to data released by the World Bank.

The report indicated that the affected countries included Turkey, Iraq, Jordan, Lebanon, Syria and Egypt.

The report was published this past week on the many economic effects of the war in Syria and the spread of IS.

The paper says that the combined economic size of the six economies measure by GDP could have been over $35 billion larger had the war never occurred. That amount is equal to the GDP for Syria in 2007, says the World Bank.

The data does not include costs of services and infrastructure borne to make accommodations for refugees in hosting countries.

The analysis was to quantify the economic effects factors in both the war and the spread of IS direct economic effects and the opportunity costs from the loss of trade initiatives across the region.

The report mentioned the loss per capita for the economies but not in aggregate terms. That was because of refugee inflows that boosted the population numbers and therefore the aggregate investment, labor supply and consumption.

The just published analysis suggest that Iraq and Syria bear most of the direct costs of war, losing 16% and 14% of per capita welfare each respectively.

The report indicated that the trade embargo with Syria was a major factor contributing to the country’s real decline in GDP, which was estimated to be 30% and is much bigger than its output decline per capita of 13% because of the Syrian refugees and casualties of war on the overall population count.

In Iraq, the welfare losses per capita are tied to deteriorating environment and the decline that resulted in productivity from that.

The per capital Lebanon welfare losses are the biggest and reach nearly 11%, while those of Egypt, Jordan and Turkey are not more than 1.5%.

The study showed that the difference between per capita welfare and aggregate effects is pronounced the most in Lebanon, where the refugee to citizen ratio increase is the greatest and very minimal for both Egypt and Turkey, where total refugees account for a tiny share of the overall population.

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