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This aim of this chapter is to outline the rationale and methodology behind the development of the Global Terrorism Index (GTI), a composite index which attempts to measure the unobserved latent impact of terrorism across 158 countries covering over 99% of the world’s population.

The GTI attempts to capture the multidimensional direct impact of terrorist related violence, in terms of its physical effect, as well as emotional wounds and fear, by attributing a single-weighted average national level score. It is based on the Global Terrorism Database (GTD). This chapter also details selection of the indicators, weighting methodology and method of normalisation.

The GTI aims to be a reference point from which one can further discuss how researchers and the general public collectively define, interpret and contextualise the social, political and economic impact of terrorism.

Certain issues related to the data remain intractable (e.g., missing injury data in the GTD and property damage). The chapter also suggests a number of areas in which the basic index design could be expanded upon.

By presenting the GTI the chapter provides a relative measure of terrorism. Its value rests in the possibility to compare the impact of terrorism between countries and scores, analyse trends over the time and assess the aggregate global impact of terrorism.

This study aims to investigate the impact of terrorism on financial inclusion that is achieved through automated teller machine penetration and bank branch expansion.

Eight countries that are the most terrorized countries in the world were analysed using the panel fixed effect regression model and the generalized linear model.

The results provide evidence that terrorism reduces the level of financial inclusion in countries experiencing terrorism, but the presence of strong legal institutions, accountability governance institutions and political stability governance institutions mitigate the adverse effect of terrorism on financial inclusion.

A growing literature has shown that terrorism affects the economy, yet little is known about its impact on financial inclusion.

The main objective of this research is to investigate if there is a long-term relationship between “terrorism” and sustainable “economic growth” in Big Ten Countries.

The data was tested via Panel ARDL Analysis. The growth rate (GR) is the dependent variable, and the “Global Terror Index (GTI)” is the independent variable as the terror indicator. The ratio of Foreign Direct Investment (FDI) to the Gross Domestic Product (GDP), and the ratio of External Balance (EB) to Gross Domestic Product (GDP) are included in the model as the control variables due to their effect on the growth rate. A Panel ARDL analysis is conducted to examine the existence of long-term co-integration between terror and the economy. The planning of the study, the formation of its theoretical and conceptual framework, and the literature research were carried out in 2 months, and the collection of data, the creation of the methodology and the analysis of the analyzes were carried out in 2 months, the interpretation of the findings and the development of policy recommendations were carried out within a period of 1 month. The entire study was completed in a total of 5 months.

Results showed that “Terror” has a negative impact on “Growth Rate” in the long term while “External Balance” and “Foreign Direct Investment” positively affect the Growth Rate. The coefficients for the short term are not statistically significant.

The sample is only limited to Big Ten including China, India, Indonesia, South Korea, Argentina, Brazil, Mexico, Turkey, Poland and South Africa. The period for annual data collection covers the years between 2002 and 2019 and due to the unavailability of data.

Considering the risks and the mutual negative effect that turns into a vicious circle between terrorism and the economy, it is necessary to eliminate the problems that cause terrorism in the mentioned countries, on the one hand, and to develop policies that will improve economic performance on the other.

Trustful law enforcement bodies have to be established and supported by all technological means to prevent terror. The conditions causing terror have to be investigated carefully and the problems causing terror or internal conflict have to be solved. International cooperation against terrorism has to be strengthened and partnerships, information, experience sharing have to be supported at the maximum levels.

It is certain that terror might have a negative influence on the performance of economies. But the limited number of studies within this vein and the small size of their sample groups mostly including single-country case studies require conducting a study by using a larger sample group of countries. Big Ten here represents at least half of the population of the world and different regions of the Globe.

The relationship between terrorism and foreign direct investment (FDI) has stimulated research curiosity given its effects on lives lost, injuries, property damaged, and the psychological aftereffects, which to a very large extent impact economic growth and development. The realization of the magnitude of its influence on bilateral economic ties engineered the study, which examined the impact of terrorism on FDI in Nigeria. The data for this study were sourced from Global Terrorism Index (GTI), Stockholm International Peace Research Institute (SIPRI) database, International Country Risk Guide (ICRG)’s Quality of Governance (QoG) database, Central Bank of Nigeria (CBN) Bulletin, and World Bank Development Indicators (WDI) using autoregressive distributive lag (ARDL) bounds testing approach as described by Pesaran et al. (2001). From the results obtained, military expenditure, episode(s) of ethnic violence, and terrorist attacks have all been noted to have negative and significant impacts on FDI in Nigeria. The implication is that the reduction in FDI observed in the data is attributed to terrorism. Therefore, governments should overhaul the security apparatus so as to quell the menace of terrorists. This will go a long way to create a conducive environment for FDI to thrive, which will create more jobs for the growth and development of the Nigerian economy.

Following the financial crisis, across the Western world, defense budgets have undergone substantial and far-reaching cuts. But in the emerging markets there has been a significant rise in defense expenditure (DE). Countries such as China, Brazil, and India have doubled or even tripled their defense spending during the past two decades. It has been generally argued that terrorism can potentially affect economic growth adversely in the short run through a number of channels. Terrorist attacks can increase uncertainty which limits the scope for domestic investments and also diverts foreign direct investment. In order to mitigate terrorism, increased government spending on security can crowd out more growth-enhancing public and private investments in social sectors such as health and education, which in turn may affect the long run growth of a nation. Terrorism also hinders growth by raising the cost of doing business in terms of higher wages, larger insurance premiums, and greater security expenditures. These higher costs result in reduced profits and, thus, smaller return on investment. Terrorist attacks can also destroy infrastructure, thereby leading to business disruptions. This study attempts to examine both the short- (SR) and long-run (LR) associations among terrorism, DE, and its impact on GDP taking time series evidence, using autoregressive distributed lag model (ARDL) model from some selected countries of Asia – India, China, Bangladesh, and Pakistan – during 1990 to 2014. The results show that there are LR associations among the three variables for Pakistan only.

Terrorism dates back to the uprising against the Roman Empire in first century BC and the term entered Western literature during the eighteenth century. Conceptually, it has emerged as a security problem in a national and international context. However, terrorism is not only a security problem but also has significance on political, social, cultural, psychological, and especially economical aspects. A weak economic structure of a country makes it easier for terrorist organizations to manipulate its society in a certain direction. Issues such as economic growth, foreign trade, employment, foreign investments, and public expenditures are first affected by terror incidents, and thereafter are known to have medium- and long-term effects. In general, it is observed that developed countries are less affected from terror incidents than developing countries. In this context, in this study, regional assessments will be made using the following indicators: the Global Terror Index (GTI), gross domestic product (GDP), export, foreign investments, and public expenditure. Regional and intercontinental assessments will be implemented using spatial econometric techniques. The GeoDa package program will assess the diversity in terrorism between continents. Our main hypothesis is that terrorism’s economic effect is more in developing countries and the Middle East than among other developed countries. The other aim of the study is to determine which terrorism is more effective and which economic indicator is more affected and gives the best result about effects of the terrorism on the countries and continents. This study predominantly tries to examine whether terror incidents are most influential on the economies in the Middle East region.

The purpose of this paper is to study the impact of global anti-money laundering and countering the financing of terrorism (AML/CFT) standards on combating money laundering and terrorist financing (ML/TF) efforts. This study will assess the impact of AML/CFT legal framework as well as the effective implementation of the framework on combating crimes.

The author develops an AML/CFT effectiveness index using the results of 11 immediate outcomes in mutual evaluation reports to measure the overall effectiveness of regimes in combating ML/TF. In addition to this index, the AML/CFT compliance index is used to measure the strength of the AML/CFT legal framework of countries. A model was developed and tested to measure the impact of the AML/CFT legal framework and its effective implementation on corruption, bribery, terrorism and crimes.

The results suggest that the effective implementation of the AML/CFT legal framework is important to combat ML/TF. The existence of a sound AML/CFT legal framework alone will not be sufficient to combat ML/TF. Therefore, countries are required to implement their legal framework effectively to achieve the AML/CFT goals of the country as well as the global policymaker. The empirical results show a significant relationship between the AML/CFT effectiveness index with the proxies the author used to capture corruption, bribes and crimes. Considering the wide range of implications of the crimes, which are related to ML/TF, this study suggests the global policymakers to further strengthen the monitoring mechanism of AML/CFT deficient countries to protect the global financial systems from criminals.

There is a dearth of studies on the impact of the effectiveness of the AML/CFT regime on combating ML/TF. Therefore, this study will lay the foundation for future studies on measuring the effectiveness of an AML/CFT regime. More appropriate measures will be developed in the future based on this foundation.

This paper is an original work done by the author, which discusses the impact of Financial Action Task Force standards on combating ML/TF. The AML/CFT effectiveness index is the original idea of the author, which can be used as a quantitative measure to capture the effectiveness of the AML/CFT regimes in future studies.

Nigeria has been ravaged by terrorist activities which has made the country unsafe for Nigerians and foreign investors. The motivation of this study arises from the dearth of research applying quantitative empirics to the determinants of terrorism in a specific country. To achieve this goal, vector autoregressive (VAR) model was applied using data from Global Terrorism Database (GTD), International Country Risk Guide (ICRG) data, Stockholm International Peace Research Institute (SIPRI) data, and Transparency International. Stata 13 software was used for estimation. The results show that ethnic violence, absence of good governance, presence of corruption, and rises in military expenditure are part of the causes of terrorism in Nigeria. It is, therefore, recommended that internal security should be maintained to minimize the occurrence of ethnic violence and ethnoreligious biases (sentiments) in the discussion of issues concerning Nigeria. Also, politicians should stop the proliferation of arms, as this will cease the violent reactions before and after elections. Finding lasting solutions to corruption using constitutional means will improve the quality of governance, which will improve the welfare state of the people and reduce restiveness.

This chapter attempts to highlight the economic perspective behind the rising incidence of terrorism across the world that has impinged a serious threat to the sustainability of mankind. Based on the sample of 123 countries all over the world, it has sought to analyze the relationship between the intensity of terrorism faced by a country and the level of its economic development. Moreover, classifying terrorist activities as externally sponsored and internal militancy triggered by extremist outfits, this chapter seeks to identify which type of terrorism is more pronounced in a country and the underlying economic considerations. Besides, in this study, an attempt has been made to examine the extent to which a country’s military expenditure is attributable to the degree of terrorism it is exposed to.