Terrorism in Developing and Advanced Economies: A Historical Look

Acts of terrorism occur throughout the globe, yet the toll on human lives and economic activity can weigh much heavier in different parts of the world.

For example, 83% of attacks worldwide from 2002 to 2019 occurred in South Asia, the Middle East and North Africa, and sub-Saharan Africa.See Khusrav Gaibulloev and Todd Sandler’s April 2023 article “Common Myths of Terrorism” for more details, including those about this region classification system adapted from the World Bank. Many nations in these regions are relatively poor and lack state capacity to counter terror threats effectively.Wealthy nations have also seen major terror incidents (e.g., 9/11 in the U.S. and the July 7, 2005, London bombings in the U.K.), indicating the limits of counterterrorism efforts even in advanced economies. Terrorist attacks also create an additional challenge to economic development; studies have shown that terrorism can negatively affect the flow of foreign direct investment and bilateral trade.

In this blog post, we first show the number of terrorist attacks from 1970 to 2020At the time of this writing, 2020 was the last full year for which data from the Global Terrorism Database were available for our purpose. occurring in advanced economies and in emerging market and developing economies as defined by the International Monetary Fund. For brevity, we use the term “developing economies” to refer to this latter group. Second, we list the top 25 nations and territories ranked by cumulative number of terrorist attacks in the post-9/11 period (2002-20). Finally, we list the top 25 nations and territories ranked by per capita terrorist attacks, again over the post-9/11 period.

Terrorism in Advanced and Developing Economies from 1970 to 2020

The figure below shows that terrorism in advanced economies has remained relatively stable through the entire period we examined. In contrast, terrorism in developing economies increased rapidly in the 2000s, with some moderation after 2014.

Terrorist Attacks in Advanced and Developing Economies, 1970-2020

SOURCES: Global Terrorism Database, International Monetary Fund and authors’ calculations.

Indeed, it is clear from the next figure that even with the decline in terrorism in developing economies in recent years, the ratio of attacks in developing economies to those in advanced economies far exceeds its pre-9/11 peak. Various factors have contributed to this pattern, including the rise since the 1990s of terrorist groups like al-Qaida and the Islamic State group, which have been based primarily in developing economies.

Ratio of Terrorist Attacks: Developing Economies to Advanced Economies, 1970-2020

SOURCES: Global Terrorism Database, International Monetary Fund and authors’ calculations.

Top Venues of Terrorism in the Post-9/11 Period

The following figure identifies the 25 places around the world with the largest cumulative numbers of terrorism incidents in the post-9/11 period.Data for the West Bank and Gaza are reported together in the Global Terrorism Database as terrorism incidents in the “West Bank and Gaza Strip.”

Places with Largest Number of Terrorist Attacks, 2002-20

SOURCES: Global Terrorism Database, International Monetary Fund and authors’ calculations.

Except for the U.K. and Israel, all the other places listed in this figure are developing economies, and most are located in Asia and Africa. Three of the top five nations (Afghanistan, Pakistan and India) are located in South Asia. Notice, however, that the population sizes of these places vary considerably, such that it is useful to consider per capita terrorist incidents to get a sense of the average terrorism hazard faced by a typical resident.

In the figure below, we account for the issue of population scale by identifying the 25 places around the world with the largest numbers of terrorism incidents per capita. Some less populous places (the West Bank and Gaza, Somalia and Libya) now feature in the top five, replacing Pakistan, India and the Philippines. Among advanced economies, Israel moves higher up on the list, while the U.K. moves off it and is replaced by Greece and Ireland.

Places with Largest Number of Terrorist Attacks Per Capita, 2002-20

SOURCES: Global Terrorism Database, International Monetary Fund and authors’ calculations.

Conclusion

The post-9/11 period has seen an increase in incidences of terrorism in developing economies. Much of this terrorism is located in Asia and Africa. Further, many terrorism-impacted areas are extremely poor and face challenges in terms of state capacity to counter terrorist threats. Aside from other challenges, terrorist acts and the insecurity they engender hamper economic development in some of the world’s most economically vulnerable areas.

Notes

1. See Khusrav Gaibulloev and Todd Sandler’s April 2023 article “Common Myths of Terrorism” for more details, including those about this region classification system adapted from the World Bank.
2. Wealthy nations have also seen major terror incidents (e.g., 9/11 in the U.S. and the July 7, 2005, London bombings in the U.K.), indicating the limits of counterterrorism efforts even in advanced economies.
3. At the time of this writing, 2020 was the last full year for which data from the Global Terrorism Database were available for our purpose.
4. Data for the West Bank and Gaza are reported together in the Global Terrorism Database as terrorism incidents in the “West Bank and Gaza Strip.”