By Benadeta Mwaura - Reporter
Kenya, 23 December 2025 - In 2025, conflict once again proved to be one of the most powerful forces shaping the global economy.
From Europe’s prolonged security crises to Africa’s devastating wars and economic stand-offs between major powers, geopolitics dictated capital flows, trade routes, humanitarian spending and growth prospects.
The year underscored a stark reality, wars no longer remain local, their economic consequences ripple across continents.
In Europe, the ongoing war in Ukraine continued to distort markets well beyond the battlefield. Energy prices remained volatile as countries accelerated the shift away from Russian supplies, forcing governments to pour billions into subsidies and defence spending.
While some European economies adapted through diversification and renewables, the cost was high, swelling public debt, tightening fiscal space and slowing growth across the continent.
Defence manufacturing surged, but consumer confidence and industrial output remained under pressure, especially in Eastern and Central Europe. The war effectively restructured Europe’s economic priorities, placing security above austerity and long-term climate investments.
Beyond Europe, Africa bore some of the most severe consequences of conflict in 2025.
In 2025, conflict did not always announce itself with full-scale war.
In many places, it lingered, persistent, adaptive, and quietly reshaping economies, governance, and everyday life.
Across Africa and beyond, power struggles took different forms, militant insurgencies, post-war fragility, criminal violence, and international interventions that blurred the line between peacekeeping and containment.
From the Horn of Africa to West Africa and across the Atlantic in Haiti, instability remained one of the most powerful forces shaping national priorities and human survival.
The war in Sudan reached a grim milestone, becoming one of the world’s most severe humanitarian crises, according to international aid agencies.
Fighting between rival military factions collapsed supply chains, destroyed agricultural production and displaced millions, straining neighbouring economies and forcing massive humanitarian reallocations.
The conflict’s economic toll extended far beyond Sudan’s borders, disrupting regional trade corridors in the Horn of Africa and diverting international funding from development into emergency relief.
In the Democratic Republic of Congo, persistent conflict in mineral-rich eastern regions continued to affect global supply chains.
As the world accelerated its transition to electric vehicles and renewable energy, insecurity around cobalt, copper and coltan mining zones exposed how fragile the global green economy remains when built on unstable regions.
Investors faced mounting ethical and operational risks, while the Congolese economy struggled to convert mineral wealth into broad-based development amid insecurity.
The Sahel region, stretching across Mali, Burkina Faso and Niger, also remained economically fragile as insecurity, military takeovers and shifting alliances disrupted agriculture, trade and aid flows.
Somalia spent much of 2025 in a state of uneasy persistence rather than calm.
While the federal government continued to reclaim territory from al-Shabaab and assume more security responsibility as international troops gradually drew down, the militant group remained capable of deadly, symbolic attacks, particularly in Mogadishu.
Suicide bombings, assaults on government-linked facilities, and targeted killings reminded Somalis that gains on paper did not always translate into safety on the ground.
The transition to a new African Union security framework placed pressure on Somali forces to perform without the depth of resources they had long relied on.
At the same time, regional tensions, including diplomatic strains involving Ethiopia and Somaliland, complicated coordination in a region where borders, politics, and security are deeply intertwined.
In neighbouring Ethiopia, the shadow of war still hung heavy in 2025, especially in Tigray.
Though large-scale fighting had subsided, peace remained fragile and incomplete.
Internal divisions within Tigray’s leadership, unresolved grievances, and the slow pace of reconstruction meant that stability felt conditional.
Beyond Tigray, violence flared intermittently in Amhara and Oromia, driven by armed groups, ethnic tensions, and heavy-handed security responses.
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For ordinary Ethiopians, the conflict’s legacy was economic as much as political: disrupted farming cycles, limited humanitarian access, inflationary pressure, and a population exhausted by years of uncertainty. Ethiopia’s story in 2025 was not one of war resumed, but of peace not yet fully arrived.
Further west, Nigeria’s conflicts were less centralized but no less corrosive.
The country spent 2025 battling multiple, overlapping security crises, jihadist insurgency in the northeast, banditry and mass kidnappings in the northwest, farmer–herder clashes in the Middle Belt, and separatist agitation in the southeast.
These were not isolated conflicts, they fed into one another, draining state capacity and investor confidence.
Entire communities adjusted their lives around insecurity, markets closed early, schools shut down intermittently, and transport routes became risk calculations.
Despite government assurances and military operations, Nigerians increasingly experienced conflict as a constant background condition, one that quietly taxed the economy and eroded trust in institutions.
Thousands of kilometres away, Haiti represented another face of modern conflict, one where gangs, not armies, controlled territory. By 2025, armed groups dominated large swathes of Port-au-Prince, collapsing public order and fuelling one of the world’s worst humanitarian crises.
Into this vacuum stepped international intervention, with Kenya playing a leading role in a multinational security mission. Kenyan officers deployed to support the Haitian National Police, while others completed rotations and returned home, carrying the weight of a mission defined by risk, ambiguity, and global attention.
Haiti’s crisis exposed a growing global reality, when states collapse under economic strain, political paralysis, and violence, distant nations are often drawn in, not by choice, but by necessity.
Taken together, Somalia, Ethiopia, Nigeria, and Haiti reveal a defining truth of 2025, conflict is no longer always about frontlines. I
t is about endurance, pressure, and the slow grinding effect on societies. These crises shaped budgets, displaced millions, redirected international diplomacy, and forced governments to choose between security spending and social investment.
As the world looks ahead, the question is not whether conflict will persist, but whether fragile systems can absorb its weight without breaking entirely.
These conflicts compounded food insecurity, inflation and unemployment, reinforcing cycles of instability that weighed heavily on regional economic integration efforts.
At the same time, 2025 saw the expansion of economic conflict as a substitute for open warfare.
Trade disputes between the United States and China hardened into a strategic rivalry encompassing tariffs, technology access and supply chain control.
These tensions forced multinational companies to restructure production networks, often at higher cost, contributing to slower global growth.
Canada, despite being a close U.S. ally, was drawn into economic friction over trade rules and industrial policy, highlighting how economic pressure increasingly replaced traditional diplomacy.
Africa was not immune to this economic contestation. South Africa, in particular, found itself navigating strained trade relations and geopolitical pressure as global powers recalibrated alliances.
The uncertainty affected investor sentiment and currency stability, underscoring how economic warfare can be as disruptive as armed conflict.
Within this turbulent environment, diplomatic engagement still played a role, albeit at a cost. U.S. President Donald Trump pursued high-profile peace and stability efforts through direct diplomacy, holding meetings with African leaders, European heads of state and Asian partners, including a strategic trip to Japan aimed at reinforcing economic and security ties in the Indo-Pacific.
These engagements sought to stabilise markets and reassure allies, but often came bundled with economic demands, trade concessions or security commitments that reshaped bilateral relationships.
By the end of 2025, the economic imprint of conflict was unmistakable. Wars drove up defence spending, humanitarian budgets and borrowing, while geopolitical tensions fragmented trade and slowed investment.
For Africa, the year illustrated a painful paradox: the continent bore some of the harshest economic costs of conflict while simultaneously becoming a focal point of global power competition.
As the world moves into 2026, the lessons are clear. Peace, stability and economic growth are increasingly inseparable.
Whether through armed conflict or economic pressure, geopolitics will continue to shape markets, and countries that fail to manage conflict risk may find themselves locked out of the next phase of global growth.
2025 in Review: How War and Power Struggles Reshaped the Global Economy
War Continues to Inflict Pain on People Across Continents
