An analysis of security implications of economic crises finds that:
• Economic crises impact the balance of power at both the regional and global levels.
Economic crises alter the distribution of power and introduce uncertainties about
the future trajectory and stability of the system. The current economic crisis accelerates
a shift in the balance of power from West to East.
• Economic crises have a direct impact on defence spending. They thus limit and
even alter strategic objectives at both the domestic and international levels. Due
to time-lags in defence budgeting and fluctuations in the severity of the crisis, it is
sometimes difficult to prove this effect.
• Economic crises cause internal instability and political/social unrest within states.
This may have ramifications at the international level. The current crisis has caused
internal instability and political/social unrest resulting in a change of governments in
a number of countries.Economic crises also challenge the stability of the international
system. Our statistical analysis shows that states experience slight increases in conflict
during crisis periods. However, this is not necessarily due to the crisis.
HCSS analysed 76 peer-reviewed academic studies and 42 expert opinions on the
security implications of economic crises. Periods of crises show a marked up-turn in
the number of studies on this subject. Based on its research, HCSS developed a visual
model of the various security implications of economic crises and their transmission
through the system