Ethiopia showed the greatest rise in peacefulness in 2009 among 149 countries studied in a survey .

June 8 (Bloomberg) — Ethiopia, whose army pulled out of neighboring Somalia last year, showed the greatest rise in peacefulness in 2009 among 149 countries studied in a survey released today.

New Zealand ranked as the country most at peace for the second straight year, followed by Iceland and Japan, according to the 2010 Global Peace Index, compiled by the privately funded Institute for Economics and Peace in Sydney. Iraq was least at peace, followed by Afghanistan, Somalia and Sudan.

“A sharp drop in the number of Ethiopian fatalities resulting from external conflict was a key contributor to the country’s improved score,” according to the survey.

Ethiopia’s withdrawal of troops from Somalia in January 2009 after a two-year occupation as well as a decline in military spending helped the African nation rise to 127th most peaceful nation in the 2010 survey from 133 the year before.

A well-functioning government and judiciary, freedom of the press, the ability to deliver social services and a high percentage of youth enrolled in schools are the key drivers of peace, said Clyde McConaghy, president of the peace index.

“In fact, democracy doesn’t correlate as directly with peacefulness as a well-functioning government does,” McConaghy said in an interview.

Ruling Party

Prime Minister Meles Zenawi’s ruling Ethiopian People’s Revolutionary Democratic Front and its allies won all but three of 547 parliamentary seats in May national elections, according to the National Electoral Board. A European Union observer mission declared the campaign failed to meet certain “international commitments.”

The peace index ranks countries using 23 criteria, from military spending and support for United Nations peacekeepers to economic indicators, murder rates, press freedom and human rights protection. The index was devised by the peace institute’s board of advisers, and the data were compiled by the Economist Intelligence Unit in London.

The popularity of New Zealand’s governing National Party, confidence in the government’s handling of the economy and the country’s emergence from the global recession last year — combined with a low homicide rate and respect for human rights – - secured it a score of 1.188 on a scale of 1 to 5. A score of 1 would be a country completely at peace.

Every 10 spots a country moves up in the Peace Index is marked by an average $3,100 rise in per-capita gross domestic product, McConaghy said.

Peace Dividend

“The total cost of violence in the world is over $4.8 trillion per annum in foregone economic activity,” said McConaghy. “If the world were 25 percent more peaceful, you could fund all the UN millennium goals, pay off Greece’s debt and pay all the interest on the U.S. debt for a year.”

The UN’s Millennium Development Goals are a plan by the world body to cut extreme poverty by half, halt the spread of AIDS and provide universal primary education by 2015.

Measuring peace allows countries and companies to better assess the risks of major shocks to the global economy and to evaluate efforts to reduce those risks, according to a discussion paper presented along with the report.

Over the past four years, global peacefulness declined by 2 percent, according to the survey, coinciding with the economic crisis.

Better for Investment

“Peaceful countries tend to have lower interest rates, lower risk profiles, shorter payback periods and provide a more stable environment for investment,” according to the discussion paper.

The U.S., engaged in wars in Afghanistan and Iraq, was the 85th most-peaceful country, one spot ahead of Angola and five spots behind China. Russia finished at 143, the seventh least- peaceful country in the world, just ahead of Israel.

Estonia, the Baltic nation of 1.3 million people bordering Russia, joined Madagascar, Pakistan and Yemen as the countries with the greatest decline in peacefulness within their borders since 2007, the year the survey was first issued.

An increasing threat of violent demonstrations, a rising murder rate and military expansion in 2009 put Estonia, which hasn’t seen combat since World War II, in the same basket as countries fighting Islamic insurgency and civil war, according to the report.

The index was founded by Steve Killelea, chairman of Integrated Research Ltd., a computer services company based in Sydney. Killelea founded the Institute for Economics and Peace in 2008 after the first peace index. He plans to endow chairs in peace economics at several universities around the world, said McConaghy.

Source: Bloomberg

Author: Peter S. Green Editors: Mark Schoifet, Bob Drummond.

Date: June 8th