Media Release
FA130 - 17 October 2003
Costs Of Failing To Combat Terrorism
Australia has highlighted the major threat that global terrorism poses to economic development around the world.
The costs of combating terrorism need to be seen as a crucial investment because it is only by reducing the threat of terrorism that we can underpin economic progress.
Studies show that as much as a full percentage point has been lost from Indonesia’s Gross Domestic Product because of the tourism slump prompted by the Bali bombings. The International Monetary Fund estimates terrorism-related costs in the United States could reduce economic output by as much as US$75 billion annually.
These examples highlight the economic impact that terrorism can have on all countries – often regardless of whether the terrorist attacks occur in those countries themselves. For instance, civil aviation has been adversely affected globally by the September 11, 2001 attacks in the US.
Terrorism can also severely reduce the flow of crucial investment dollars into developed and developing economies.
At the APEC Joint Ministerial Meeting in Bangkok today, I have circulated the Australian paper - “Costs of Terrorism: and the benefits of working together”.
Prepared by the Department of Foreign Affairs and Trade Economic Analytical Unit, the report emphasises that APEC’s counter-terrorism agenda is a vital investment towards the long-term prosperity of our region.
Counter terrorism initiatives make trade flows more efficient - new technologies introduced to strengthen security can increase efficiencies in trade and decrease trade costs through reduced theft, shorter delays and lower insurance costs.
A key conclusion is that all economies have an economic interest in cooperating to reduce the threat of terrorism.
Economies that fail to combat terrorism and ensure the safety of travel and trade can expect to incur significant costs in terms of lost investment and trade opportunities.
We cannot afford to forget that the infliction of ongoing economic pain is a key plank in the evil design of international terrorists.
Australia strongly endorses joint action already undertaken through APEC to strengthen international cooperation on counter terrorism - and we will continue to pursue further measures.
The report is available on the DFAT website at www.dfat.gov.au.
Media enquiries: Chris Kenny (Minister’s office) (02) 6277 7500 - Lyndall Sachs (Departmental) (02) 6261 1555