Estimate of The Economic Cost of Armed Conflict: A Case Study From Darfur

Abstract

There has been much debate in many forums to seek a settlement of the Darfur conflict (DC), but no study has addressed its economic cost. This study is the first attempt to quantify the economic cost of the DC. The war’s costs include the destruction of infrastructure, direct military spending attributable to the war effort, and the impact of the latter on capital formation. In addition, the human destruction – loss of life and income – must be taken into account. Our calculations show that the government of Sudan has incurred costs totaling US$30.5 billion, equivalent to 171% of 2003 Gross Domestic Product GDP, on the war in Darfur. This includes $10.1 billion in direct military expenses; $7.2 billion in the lost productivity of internally displaces persons; $2.6 billion in foregone lifetime earnings of the dead; $4.1 billion in infrastructure damage; and $6.5 billion in war impacts on GDP. The total costs of the war are $41.5 billion if we added military spillover and African Union/UN hybrid operation in Darfur peace-keeping operations of $10.9 billion. While the country has spent only 1.3% of its budget on public health and less than 1% on education over the past two decades. The war consumes 13% of GDP in a society that lacks the means to provide the basic entitlements of education, food, health care, and shelter to its people.