Wars leave behind more than destruction; they shatter lives and displace entire communities. Families are forced to leave their homes and don’t have access to food or healthcare. The human cost of war is immense, measured in the suffering of civilians who endure violence, fear, and instability. By mid-2024, nearly 123 million people worldwide were forcibly displaced by conflict and human rights violations. Refugees numbered 43.7 million, while internal displacement reached 72.1 million, with most coming from different countries, such as the Democratic Republic of the Congo, Haiti, and Mozambique.

Yet alongside the human tragedy comes economic devastation. Wars destroy vital infrastructure, such as roads, schools, and hospitals, leaving massive reconstruction costs that require years of sustained investment. Conflicts also drain a country’s human capital, as casualties, injuries, and displacement weaken the workforce and reduce productivity. For example, in the Gaza Strip, two years of war have killed over 67,000 people and displaced around 100,000 among the 2.2 million people living in the territory. Since the start of the war, the population has fallen to an estimated 2.1 million due to death and displacement. These losses account for more than 10% of the pre-war population. This highlights that future reconstruction will face severe shortages of skilled labor and community capacity, making the recovery of Gaza’s infrastructure and economy even more difficult. Therefore, understanding both the human and economic costs of war is essential to grasping the full impact of conflict on societies and their path to recovery. This raises a central question: To what extent do the economic consequences of war affect a nation’s ability to rebuild and achieve peace?

Beyond national economies, wars impose heavy costs on businesses, threatening their operations and trade. Operating in conflict zones exposes organizations and global markets to serious risks that can easily disrupt normal business activity. Wars disrupt shipments, limit investments, and increase transportation and labor costs. When supply chains break down, companies struggle to keep production going. In many cases, companies lose access to workers, as wars displace many families, including young professionals. This leaves fewer people available to work. Businesses may also face shortages of raw materials or enormous damage to critical infrastructure. This makes it extremely difficult for a company to maintain trade or meet demand.

This is where peace agreements take on a crucial role. They do more than stop violence and save lives. Additionally, they create conditions for economic recovery by allowing investments to resume and facilitating reconstruction plans. These plans are often backed and implemented by international actors such as the World Bank, the IMF, UN agencies, bilateral donors, and even private sector investors. In this way, mediation can serve as a powerful tool not only for peace but also for long-term stability.

The economic cost of war

Wars impose immense economic costs. They cause the loss of lives and human capital and destroy critical infrastructure. On the economic level, conflicts create severe macroeconomic disruptions, including rising national debt, inflation, and a major decline in GDP. All these effects leave economies fragile and slow down recovery. They also limit the ability of both governments and businesses to stabilize and grow.

The ongoing wars in Ukraine and Sudan highlight a shared reality. The cost of war reaches far beyond human loss, leading to economic collapse and the widespread loss of livelihoods. For example, the Russian invasion of Ukraine has caused immense economic devastation, adding to the human toll of death, injury, and displacement. In the first half of 2022, Ukraine’s economy collapsed by nearly 30 percent as large parts of its territory were occupied. Key industries were destroyed, and around three-quarters of small businesses stopped operating. Mining, metallurgy, and manufacturing also shut down. Despite some recovery and reconstruction efforts by mid-2022, particularly in agriculture, Russia renewed its attacks on key electricity infrastructure. These renewed strikes damaged production and disrupted exports. As a result, it slowed economic growth.

Moving to the ongoing humanitarian crisis in Sudan, the war erupted from a power struggle between the Sudanese army and the Rapid Support Forces (RSF). This happened after disagreements over merging the RSF into the national army and transitioning to civilian rule.

Their rivalry for control turned violent in April 2023, unleashing brutal fighting that devastated cities and displaced thousands.

From an economic perspective, the war in Sudan had caused economic losses exceeding $26 billion by November 2023. This represents over half of the country's economic value from the previous year. The industrial sector, including manufacturing and oil refining, has lost more than 50% of its value, according to the Sudanese finance minister. The conflict has also resulted in a loss of 4.6 million jobs and pushed over 7 million more people into poverty. Furthermore, the agrifood system alone has shrunk by 33.6%.

From these examples, it is clear that operating in such conflict zones poses extreme risks for businesses. The disruption of supply chains and damage to critical infrastructure caused by these violent conflicts often halt production. Furthermore, companies must face threats to their workforce, including displacement, safety hazards, and reduced productivity stemming from the trauma of war. Given the high cost of all of these factors combined, peace mediation becomes an essential requirement.

Building on this, the link between peace and economic recovery becomes evident. When meditation and dialogue are effective in stopping violence, they not only save lives but also serve as the first steps to rebuild infrastructure and revive industries. This, in turn, lays the foundation for longer-term economic stability. However, when mediation fails, these opportunities become limited, leaving economies fragile and communities vulnerable. This connection shows how peace mediation can stimulate economic renewal. It also highlights why, despite its potential, mediation sometimes falls short.

Why peace mediation efforts sometimes fail

But what exactly is mediation, and how does it influence a country’s economic recovery? Peace mediation is a voluntary process where a neutral third party helps resolve disputes through dialogue. It can take place at international or national levels. A variety of actors may be involved, including governments, international organizations, or independent mediators. When peace negotiations begin, they represent the first steps toward recovery. Even the early stages of mediation can ease tension between conflicting parties.

Mediation plays a crucial role in restoring stability and rebuilding economies; however, its success is never guaranteed. Mediation efforts and peace agreements sometimes fail because modern conflicts have become deeply complex. They involve fragmented groups and constantly shifting alliances. Rather than clear state-to-state rivalries, they are defined by deep mistrust among parties. In such contexts, peace agreements are not enough to address the underlying political, social, and economic tensions that fuel violence.

Many peace talks collapse because the parties enter negotiations not to compromise. Instead, they do it to gain time, rebuild strength, or seek international legitimacy. The Sudan war illustrates this clearly. The repeated mediation attempts by regional and international actors have failed to end the conflict between the army and the Rapid Support Forces. Both sides continue to seek military advantage and distrust external involvement. One of the major causes of failure of peace mediation is the deep divisions among both the warring factions and the mediators involved. The mediation attempts also lacked any real enforcement or accountability. It failed to pressure foreign backers to stop supplying weapons. Rather than tackling the root causes of the conflict, such as power struggles, governance failures, or foreign interference, efforts have mostly targeted short-term ceasefires. Even ceasefire attempts in Sudan have collapsed, with the fighting now spreading to more cities and intensifying the conflict.

Similarly, in Ukraine, several mediation efforts, including the Minsk agreements, have not led to lasting peace. Both sides have refused to compromise on essential matters such as sovereignty and territorial integrity. Additionally, talks between the United States and Russia reached a deadlock. This happened because neither party was prepared to make progress on key concerns like security guarantees or Ukraine’s independence. These examples show that mediation often fails when there is no genuine political will and when the balance of power on the ground keeps shifting. Without strong mechanisms for enforcement and long-term peacebuilding, peace agreements are more likely to fail.

When peace mediation fails, businesses operating in conflict zones face serious multifaceted challenges. They face rising security costs as well as frequent disruptions in supply chains. This uncertainty makes long-term planning and investment extremely difficult. In response, many companies reduce their operations or withdraw from the country entirely, further slowing economic activity and hindering recovery. This failure may create a broader climate of economic instability that can persist long after the conflict ends.

A prominent example is Lafarge, the French construction company, which continued operating a cement plant in northeast Syria during the civil war in 2011. The company faced extraordinary challenges, including disrupted supply chains and extreme security risks. It also received constant threats from multiple armed groups controlling the region. To maintain operations, Lafarge reportedly made payments to local militias for protection, a decision that later sparked controversy and legal scrutiny. Ultimately, the intensifying conflict made it impossible to continue, forcing the company to shut down the plant and withdraw completely from the area. The company’s exit from the region resulted in significant financial losses as well as reputational damage, combined with ongoing severe legal consequences. This case highlights the complex ethical and operational dilemmas businesses face in conflict zones.

On the contrary, when peace mediation actually succeeds in ending violence, it allows governments and international organizations to step in and coordinate reconstruction efforts. This cooperation strengthens the country’s institutions and lays the groundwork for long-term growth. A clear illustration of this process can be seen in the case of Bosnia and Herzegovina. This case shows how coordinated post-conflict support can help a country take practical steps toward recovery. Despite heavy casualties and widespread destruction, the World Bank’s financial aid and technical guidance in the late 1990s helped the country begin its transition to a market economy while restoring essential services. Over the following two decades, much of the damaged infrastructure was rebuilt, and institutions were strengthened. Consequently, the economy gradually stabilized, which laid the foundation for longer-term reforms and progress.

Corporate responsibility

While mediation is often associated with governments, UN agencies, or international organizations, it is not limited to them. Businesses operating in or around conflict zones are directly affected by instability, and this creates both an incentive and an opportunity for them to contribute to peacebuilding efforts. As violence escalates, companies face significant operational risks. These risks include damaged assets, shrinking markets, and rising security costs. Supporting initiatives that reduce tensions or strengthen local resilience can, therefore, help safeguard their operations and create more stable conditions for investment.

Companies can play an important role in peacebuilding through their core business activities. They can help stabilize communities affected by conflict by creating jobs and providing essential goods and services. Especially, businesses that have strong local ties with communities and therefore understand the social and political dynamics of a country can act as anchors of stability even in fragile environments.

Companies can also support post-conflict recovery by partnering and working with NGOs and development agencies. These organizations provide funding, expertise, and guidance for post-conflict reconstruction, while companies implement projects on the ground. This creates jobs, restores essential services, and helps revive local economies. At the same time, businesses can earn financial returns while contributing to peacebuilding. A clear example comes from Benghazi, Libya. The INGO, Agency for Technical Cooperation and Development (ACTED), partnered with local construction companies to rehabilitate the city’s water authority, schools, and a psychiatric hospital. These efforts restored essential services and enabled over 800 children to return to school. These efforts helped communities recover and encouraged displaced families to return.

Beyond their economic role, companies can also engage in what is known as corporate peacemaking. This involves using their influence and networks to support peace efforts directly. For instance, by facilitating dialogue between conflicting parties, raising awareness, or advocating for peace-focused policies. Businesses can also help prevent conflict by offering early warnings about rising tensions and encouraging cooperation between communities, governments, and other relevant stakeholders.

Businesses can contribute meaningfully to the peacebuilding process in different ways, both to support stability and to protect their own long-term interests. They can contribute by partnering with international organizations to implement reconstruction plans or by using their local networks to facilitate dialogue. Businesses can help create the conditions in which recovery and sustainable investment become possible.

Conclusion

Wars leave profound damage that extends far beyond the immediate conflict zones. They destroy lives and weaken societies and economies. Understanding these costs reminds us that peace is not only a moral goal but also an economic necessity.

Peace mediation plays a critical role in post-conflict recovery. It helps rebuild trust and restore stability, enabling communities to shift their focus from survival to sustainable growth. Yet modern conflicts are often highly complex, involving multiple actors with competing interests, which can limit the effectiveness of mediation efforts and, in some cases, lead to their failure. Achieving sustainable peace, therefore, requires more than the engagement of governments and diplomats. International financial institutions, NGOs, and businesses also have an essential role, contributing through investment, participation in reconstruction efforts, and job creation. Businesses can help stabilize fragile regions and provide communities with a pathway toward hope and resilience. Ultimately, peace is a shared responsibility. When governments, mediators, and the private sector collaborate, the devastation of conflict can be transformed into practical foundations for long-term stability and prosperity. Shall we?

This article is part of The Outside World, ftrprf’s very own research center.

For organizations, it’s pivotal to thoroughly understand what is happening in society. We help companies generate comprehensive insights into societal change and its potential effects on their strategy and operations, both negative and positive. With actionable societal insights, courageous plans, and a can-do mentality, we connect the outside world to your company's strategy. For these outside-world insights, we use a rigorous methodology that includes data processing, quantitative and qualitative analysis, and a thorough review process to ensure the accuracy and consistency of our findings.

For more information, please contact theoutsideworld@ftrprf.com.

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Next articleWhen Women Lead: Why Representation Creates Possibilities – but Not Always Transformation

Acknowledgement: I write as a man engaging with feminism from an ally perspective. The analysis below draws on feminist scholars, activists, and political figures. My aim is not to define women’s experiences, but to listen and contribute to conversations about how political power intersects with gender justice. There is a growing global recognition that having more women participate in politics is not just a matter of symbolic fairness, but a pathway toward real social change. Research across dozens of countries shows that when women hold office, governments tend to invest more in healthcare, education, child welfare, and violence prevention – areas that disproportionately affect women and children. According to UN Women, as of 2025, roughly one fourth of the world’s national parliamentarians are women. Only a minority of countries have ever been led by a woman. Just a couple weeks ago, Japan elected its first ever female leader. Japan, a male-dominated country with strong conservative gender roles, chose Sanae Takaichi as their new prime minister. However, representation alone doesn't necessarily guarantee feminist change. Margaret Thatcher famously rejected feminism, and Sanae Takaichi has taken a similar stance, openly opposing key gender equality reforms. Yet, both still mark a significant step forward for women in politics, just not in the way we might assume. Their rise shows how women can break into traditionally male structures without necessarily changing them. So the question isn’t: d oes electing women produce feminist change? It’s rather: under what conditions does women’s representation become liberatory for women — and when does it fail to do so? This article explores that tension — how representation can be liberatory, how it sometimes is not, and what that means for the movement toward greater gender equity. Sanae Takaichi’s election is historically significant, but her policies signal continuity rather than transformation. Takaichi has opposed gender quotas and same-sex marriage, supported traditional family structures, and appointed only two women to her cabinet. Reporting across Japanese and European media stressed that she represents continuity, not transformation. Here, Margaret Thatcher is a historical parallel. As Britain’s first female prime minister, she broke a glass ceiling that had held for centuries. She also rejected feminist language and appointed almost no women to senior positions. Rather than challenging gendered institutions, she often reinforced them. Thatcher’s presidency was the start of something new: a woman could lead a major Western democracy. However, she governed within a framework that remained patriarchal and individualist. Italy’s Prime Minister Giorgia Meloni offers a contemporary version of a leader of a powerful country. Meloni is a high-profile woman whose conservative agenda defends traditional family models rather than reconfiguring gender roles. Since taking office in 2022, she has positioned herself as a symbol of female achievement while at the same time distancing herself from feminism, arguing that women’s empowerment comes from motherhood and religious values, not structural reforms. These examples help us see a pattern. A woman’s presence at the top does not automatically shift the institutions she inherits. A leader can break the glass ceiling yet leave it unchanged. That does not make their leadership irrelevant, symbolic breakthroughs matter, but symbolism alone cannot undo patriarchal systems. None of these women leaders suggest they should not lead a country. The conditions around leadership, such as institutional support and political ideology, determine whether representation translates into meaningful change. At the same time, placing an expectation on female leaders to “fix” gender equality simply because they are women reproduces an unfair dynamic. Male leaders are not held personally responsible for dismantling patriarchy, yet female leaders who do not adopt feminist agendas are often treated as disappointments. The problem is not that Thatcher, Takaichi, or Meloni are women. The problem is that political systems remain structured in such a way that individual representation does not produce collective liberation. Women’s representation in formal politics is still low, but it is rising. The UN reports that greater participation broadens public agendas, strengthens social infrastructure, and can improve democratic legitimacy. Research supports this. A 2023 study on gender and political decision-making found that women legislators advocate more strongly for public health, childcare access, and anti-violence policy. Governments with higher proportions of women are more likely to pass laws against gender-based violence and expand social-protection systems. This stands in contrast to figures such as Thatcher, Takaichi, and Meloni, whose leadership did not translate into substantive feminist gains. One explanation lies in the political environments that surrounded them. Leaders like Michelle Bachelet in Chile, and Ellen Johnson Sirleaf in Liberia, pursued transformative gender agendas because they governed within contexts more open to redistributive social policy. They were supported by progressive coalitions with public approval, and institutional frameworks that could translate feminist ambitions into more equal laws. Bachelet’s expansion of childcare rights, and Sirleaf’s post-conflict legal reforms addressing sexual violence were possible because they aligned with broader political projects that recognised gender equality as essential rather than optional. Representation matters not only because women bring new policy priorities, but because it expands who counts in public life. The symbolic change is structural: when girls see women in power, they can imagine themselves in those roles. Political scientist Anne Phillips calls this the politics of presence – the idea that physical presence is a form of political pressure. Even with recent progress, the distance to gender parity remains long. As of 2025, women hold roughly 27 percent of parliamentary seats worldwide. Only 29 countries currently have a woman serving as head of state or government. According to UN projections, the world is still more than a century away from parity in the highest offices. The Netherlands – often seen as progressive – shows how representation and inclusion diverge. Dutch political scientist Zahra Runderkamp argues that although more women are entering politics, many struggle to stay. They face greater harassment, receive smaller portfolios, and exit politics earlier. Interviews with female MPs reveal a recurring experience: politics is built around the rhythms and expectations of men. Even when women arrive in the political arena, they are often pushed to the margins of power. Runderkamp notes that Dutch parties increasingly select diverse candidate lists, but often fall back on white male leadership when it comes to top positions. Media patterns reinforce this imbalance. Male politicians are discussed in terms of their ideas. Women are more often framed by personality, tone, family, or “likability.” These dynamics flatten the meaning of progress, making it appear that the problem has been solved when its foundations are unchanged. These findings echo a broader global reality: representation matters, but institutions decide what representation can do. Media dynamics reinforce this. Men are evaluated on their ideas; women on their tone, personality, family status, or “likability.” These dynamics flatten the meaning of progress.They make it appear that representation has solved inequality when its foundations remain unchanged. Even with more balanced candidate lists – for example with initiatives like Stem op een Vrouw (Vote for a Women) , has led to a record number of women parliamentairers of 43% – parties often revert to selecting white male leaders for top roles. This context matters when evaluating the outcome of women’s leadership. If structures remain hostile, women leaders cannot simply be tasked with transforming them. The responsibility lies with institutions, parties, and citizens – not only with women who break through the door. There are women whose leadership has transformed political systems though not solely because they are women. Their success depended on coalition support, and institutions willing to adapt, apart from their own willpower to change their countries oppressive patriarchal systems. Jacinda Ardern in New Zealand built a government rooted in social infrastructure: paid domestic-violence leave, crisis-response frameworks, and a “well-being budget” that measured national progress not only by GDP, but by health, equity, and social resilience. Her reforms were possible because she led within a political culture already open to social experimentation. Michelle Bachelet in Chile, who expanded childcare access, strengthened anti-violence programmes, and institutionalised gender mainstreaming. Similarly, Ellen Johnson Sirleaf in Liberia governed during post-conflict reconstruction, prioritising legal reforms addressing sexual and gender-based violence. In Iceland, former prime minister Katrín Jakobsdóttir made gender equality a central pillar of governance, strengthening national strategies to combat gender-based violence and supporting welfare structures that continue to rank Iceland as the world’s most gender-equal country. Her backing of parental-leave policies and public campaigns – including participation in the nationwide women’s strike – helped normalise the expectation that equality is a collective responsibility, not an individual achievement. Denmark’s Mette Frederiksen offers a different but still telling example. While her broader politics are sometimes contested, her government recognised and apologised for the historical forced contraception of Greenlandic women. Finland under Sanna Marin advanced a more comprehensive approach: her administration implemented a coordinated Action Plan for Gender Equality, aimed at embedding equity across employment, social services, and state institutions. With nearly half of ministers in her coalition being women Marin normalised female leadership across the cabinet, demonstrating how representation within institutions can shift political priorities toward care infrastructures and workplace equality. These outcomes demonstrate that feminist policy emerges when women’s representation aligns with supportive institutions and political coalitions. Women are not inherently better to lead than men — but when the environment enables it, representation can transform systems. Feminist progress has always been led by women. Supporting that progress as a man means recognising the limits of one’s perspective and practicing a form of participation grounded in listening. It means citing women’s research and activism, advocating for institutional reforms and calling out sexism in media, parties, friends, and workplaces. Being an ally does not mean speaking about or for women. It means sharing power so more women can lead on their own terms. Take the time, listen to the experience of women. The story of women in politics is neither a straight line nor a finished project. The election of Takaichi, like Thatcher before her, makes clear that a woman at the top can reinforce existing hierarchies. But the record of Bachelet, Ardern, Sirleaf and many others shows that women’s leadership can also open new political horizons. Representation is essential, but on its own, it is not liberation. Liberation happens when representation is linked to feminist agendas, and institutions willing to change. Electing women is only the beginning of this process. The task now is to build systems in which women can not only enter power, but reshape it. Shall we? This article is part of The Outside World, ftrprf’s very own research center. For organizations, it’s pivotal to thoroughly understand what is happening in society. We help companies generate comprehensive insights into societal change and its potential effects on their strategy and operations, both negative and positive. With actionable societal insights, courageous plans, and a can-do mentality, we connect the outside world to your company's strategy. For these outside-world insights, we use a rigorous methodology that includes data processing, quantitative and qualitative analysis, and a thorough review process to ensure the accuracy and consistency of our findings. For more information, please contact theoutsideworld@ftrprf.com.

2025-11-17

When Women Lead: Why Representation Creates Possibilities – but Not Always Transformation

Economics of War and Peace: How Mediation Shapes Post-Conflict Futures

The economic cost of war

Why peace mediation efforts sometimes fail

Corporate responsibility

Conclusion