Secretary of State Antony J. Blinken’s commitment to implement a ten-year U.S. strategy to prevent conflict and promote stability in nine volatile nations underscores this presidency’s conviction that peace is foundational for sustainable economic growth. Partnering countries include: Haiti, Libya, Mozambique, Papua New Guinea, Benin, Côte d’Ivoire, Ghana, Guinea, and Togo. 

Amidst the current destabilizing transnational challenges that Secretary Blinken says disrupt economies, such as terrorism, the U.S. State Department is “working closely with in-country partners, businesses, and civil society organizations” to curb violence in these politically unstable countries.

Most business leaders agree that their markets grow in a stable political setting. A study published on the Word Bank’s website concluded that political instability has adverse effects on innovation. Innovation is a key factor in long-term economic growth.

According to tech tycoon, Steve Killilea, “peace creates the optimum environment” for businesses to thrive. Killilea is the founder of the Institute for Economics and Peace, which publishes an annual Global Peace Index (GPI) report. GPI defines peace “in terms of the harmony achieved by the absence of violence or fear of violence.”

GPI’s analytics includes 99.7% of the world’s population. To evaluate the “Sound Business Environment” category, GPI uses 23 qualitative and quantitative statistics from the databases of reputable sources such as the World Bank’s World Governance Indicators, The Heritage Foundation’s Index of Economic Freedom, the World Economic Forum’s Global Competitive Index, and the International Monetary Fund’s Financial Institutions Index.

As one of the most rigorous measures of the relative peacefulness of nations, the GPI analyzes 163 countries based on three indicators: societal safety and security, ongoing domestic and international conflict, and militarization.

Considering that the U.S. ranks low (at 129 out of 163) on this year’s 2022 GPI report, one may question if the U.S. is the best exemplar, as it attempts to instruct other nations in the ways of peace. The U.S.’s low score is attributed to its current internal political instability, high militarization, and involvement in international conflicts. According to a 2017 Freakonometrics publication, the U.S. has been at war 222 years out of 239, with only 20 years at peace since its founding.

Intriguingly, the 2022 GPI ranks Afghanistan as being the least peaceful nation. What responsibility does the U.S. have in contributing to Afghanistan’s low ranking? The U.S.’s recent conflict with Afghanistan has been the longest war in U.S. history and has devastated Afghanistan’s economy. A “sound business environment” is a significant factor in the GPI’s ranking system.

Despite its warring history, the U.S. continues to maintain the largest, most innovative economy in the world. A recent study contends that political stability is not always necessary in fostering greater economic growth. In fact, war often leads to greater innovation. You may have heard the maxim, “War is the mother of all inventions.” World War II spurred the invention of electronic computers, the jet engine, radar, and several medicines we now use daily.

During wartime, governments support new inventions with more resources and funding than usual. Additionally, peaceful circumstances may lead to complacency and stagnation because the need to innovate and produce products faster is not as urgent as it is during wartime.

Some may argue that the desire for profit is as powerful a driving force as war. Many important inventions were developed during peacetime, including hearing aids, xerography, the Richter magnitude scale, the trampoline, and nylon.

Perhaps Secretary Blinken’s strategy seeks to facilitate more foreign direct investment (FDI) from U.S. investors in these nine countries, which may benefit the U.S.’s economy in the long run. Among the most important factors influencing investment decisions is a country’s political stability. Global enterprises, particularly, have a higher interest in investing in countries where intellectual property rights are regularly enforced by a healthy governance structure.

From an investment point of view, political stability seems to be crucial, especially now that globalization has caused many of the world’s economic systems to become increasingly interdependent. 

As conflict throughout the world can directly impact the United States’ economy, Secretary Blinken promises to “factor in the sometimes-difficult lessons learned from decades of U.S. involvement in stabilization efforts and apply them to how we engage through our new approach.” Basing the U.S. State Department’s strategy on the new Global Fragility Act passed by Congress, we can only hope this new approach will produce better outcomes than in years past.