How war disrupts it all

From Berlin in the World War II to Aleppo in the Syrian War, the economic cost of armed conflict, leaving aside the humanitarian one, is enough to dissuade countries from engaging with each other via arms and the men.

In 1945, West Germany was 400 million cubic meters of piled up rubble. Almost 80% of historical buildings in main cities of Germany were leveled: some were restored later and some lost forever. The trains did not work, nor was there enough food. Almost 70% of the houses were destroyed forcing people to stay in refugee camps once the war ended. Majority of men had perished fighting the war, severely impacting the labour force required to rebuild the country.

It is difficult to estimate the exact economic cost for rebuilding Germany after the war but Marshall plan or formally the European Recovery Project gives a partial figure. Beginning 1949, the Marshall Plan provided $1.4 billion to Germany with an objective to promote economic recovery. According to a 2006 report by the Federation of American Scientists, for Germany in constant 2005 dollar, the US provided a total of $29.3 billion in assistance from 1946-1952.

Taking almost 35 years, the reconstruction phase of Germany lasted upto 1980s. Even as late as 2000s, certain sections of Germany were still being rebuilt with the city of Berlin having maximum damages.

It takes decades for an economy to evolve. People from other countries migrate and settle in a country bringing new traits of commerce with them. With time, these traits become part of its settlement plans, enriching its economy to build it further. Efforts of several civilisations goes in building up a country, its economy, only to help it reach where it stands at a given point of time.

But, one war disrupts it all; dragging the country many civilisations back. In September 2012, the government forces of Syria shelled the rebel forces bankrupting 40,000 traders in the city of Aleppo in just one night.    

For the past 5 years, Syria has been witnessing war between the Islamic militants and the government forces. The population as well as the GDP of Syria has shrunk miserably since the inception of the war with the maximum brunt being borne by manufacturing and crude oil sector. According to the data released by the Government of Syria, the Syrian pound has lost about 80% of its value since the conflict began. In February 2016, Syrian President Bashar Assad put the estimated economic loss for Syria at $200 billion. Rebuilding war-ravaged Syria may be as much as $180 billion, according to World Bank President Jim Yong Kim.

The city of Aleppo, once envied for its trade and commerce, is now reduced to a debris of concrete and cement with no infrastructure. A preliminary World Bank-led assessment of damage( as of end 2014) in six cities in Syria-- Aleppo, Dar’a, Hama, Homs, Idlib, and Latakia—over housing, health, education, energy, water and sanitation, transport and agriculture-- stands between $3.6 billion to $4.5 billion.  

Even the bordering countries such as Turkey, Lebanon, Jordan and Egypt are bearing the spillover effects. The influx of more than 630,000 Syrian refugees have costed Jordan over $2.5 billion a year, the World Bank estimates. This amounts to 6% of GDP and one-fourth of government’s annual revenues.

War is the greatest negative disruptor for any economy making all its efforts over the years futile. War does not end in a day or even a year. It continues for several years on an end, putting the economy in a frozen state.

Post World War II, we know how much it took to rebuild Germany. Syria’s a tougher job ahead.