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Combating Terrorism in the Transport Sector: Economic Costs and Benefits

5 June 2004

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Combating Terrorism in the Transport Sector: Economic Costs and Benefits (PDF - 575 KB)

Overview

The ongoing threat of terrorism imposes disproportionately high costs on APEC developing countries because of their heavy reliance on trade and foreign investment. The threat of terrorism also reduces the level of factor productivity, diverting resources from more productive activities, to security. Countering terrorism imposes enormous costs on the transport system and requires significant effort from both government and industry. However, there also are benefits to securing the transport sector. These include certainty and stability in the global economy, increased investor confidence and assistance in facilitating trade.

Enhanced security by engendering certainty and stability to the global economy encourages investor, business and consumer confidence. New security measures have trade facilitation benefits separate from and additional to their counter-terrorism task. For example, new logistics systems represent an investment that will deliver considerable efficiency gains in the future. The greatest benefits from counter-terrorism measures will be realised when all countries work together to implement them.

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This report is proudly sponsored by BHP Billiton