Increasing Transnational Crime and Conflict Threaten Lives around the Globe

Transnational crime and violent conflict are on the rise. According to the latest available data, terrorism, civil war, drug trafficking, and wildlife poaching are at their highest points in decades, spilling across increasingly porous borders and highlighting the urgent need for deeper, broader, and smarter international cooperation.

“Since the end of the Cold War, the world has become increasingly multipolar,” said Quy-Toan Do, an economist at the World Bank. “Cooperation is increasingly difficult at the exact moment that the threats from crime and conflict are growing, which means global institutions are needed more than ever.”        

At a recent Policy Research Talk, Do highlighted a long list of troubling statistics on the growth of transnational threats that will be featured in a forthcoming publication on Violence without Borders: The Internationalization of Crime and Conflict due out in early 2020. Perhaps most disheartening is the rise in armed conflicts. Globally, the number of conflicts more than doubled between 2011 and 2017, from 80 to over 160. At the same time, the nature of conflicts around the globe changed, with a growing percentage of civil wars that involve outside countries. By 2017, 40 percent of all civil wars involved foreign interventions.

Fortunately, the number of fatalities from these conflicts is far smaller than earlier decades. But the human cost is still hard to fathom—the number of refugees and internally displaced people has grown exponentially. As of 2017, the total number of refugees and internally displaced people reached 60 million, the highest figure since the UN Refugee Agency started tracking these numbers in the 1950s. At the same time, refugees are traveling to countries ever further from their home country, underlining the point that no country can escape the impact of conflicts—even those far from the scene of war.

Spillovers have not been limited to armed conflict, however. Within the last five years, the number of transnational terrorist attacks has quadrupled. The value of transnational criminal networks engaged in drug production, human trafficking, and poaching has also been growing and exceeded $US 1.3 trillion by 2018—equivalent to 1.5 percent of global GDP.

While the threats have proliferated, the understanding of the drivers behind these threats has grown as well, as economists and political scientists have improved the data and tools to study these phenomena.

According to Do, researchers often rely on a model of crime and conflict as a contest over resources. In this simple model, two parties—the government and a rebel group—fight each other for control, and researchers have attempted to identify the factors determining the investment each side makes in the conflict. While the model may be simple, it has resulted in a number of useful insights:

• Higher wages and lower unemployment—what economists refer to as the opportunity cost of participation—make it harder for rebel groups to recruit new participants. Consequently, well-designed public works programs that offer employment opportunities can help reduce the pool of potential recruits.
• Citizen grievances against the government can make it easier for a rebel group to recruit participants. Economic inequality is one factor that researchers have identified as contributing to these grievances, so measures to tamp down inequality may be helpful.
• Aid and development assistance are not a panacea. While aid and development may increase wages and improve job prospects (making it harder for rebel groups to recruit), it may also increase the value of the resources over which the government and the rebel group are fighting.  

Furthermore, just as the negative effects of crime and conflict spill across borders, the factors driving these phenomena may also originate from beyond a country’s border. Commodity markets are one clear example. In Colombia, for example, research has shown falling coffee prices and lower wages increased violence in municipalities where coffee growing was widespread. However, the effect of commodity prices depends on the context. A rise in oil prices resulted in increased violence in municipalities with higher revenues since the size of the pie the two sides were fighting over had grown.

Similarly, regulatory changes in one country can spur violence in a bordering country. For example, when the U.S. Federal Assault Weapons Ban expired in 2004, neighboring municipalities in Mexico experienced a spike in gun-related homicides.       

A full accounting of how the international community can best manage the challenges arising from increasingly porous borders is forthcoming in the release of Violence without Borders: The Internationalization of Crime and Conflict, but Do pointed to general principles that can guide policy makers.

Key among these is the insight that international aid alone does not necessarily produce peace. When international aid is relatively easy to appropriate or undermines the political interests of a dominant group, it may incite greater violence. Instead, Do argued that greater coordination between international aid and peacekeeping efforts can significantly enhance the likelihood of peace.