Positive Peace Report 2020 Summary and Findings

Executive Summary

This report details the latest findings from IEP’s research into Positive Peace, including country rankings and their changes over time. The report also analyses the relationship between development and Positive Peace, finding that Positive Peace acts as a catalyst for better development outcomes.

Download the full report here.

Positive Peace is defined as the attitudes, institutions and structures that create and sustain peaceful societies. The same factors that create lasting peace also lead to many other positive outcomes that societies aspire to, including:

Thriving economies
Better performance on ecological measures
High levels of resilience and adaptability to change.

Other factors that improve with Positive Peace are measures of inclusiveness, wellbeing and happiness. Therefore, Positive Peace can be described as creating an optimal environment for human potential to flourish.

Positive Peace is conceptually and empirically linked to socio-economic resilience. Countries with high Positive Peace are more likely to maintain their stability and recover more easily from internal and external shocks. Through the modelling of the relationship between Positive Peace and the actual peace of a country, as measured through the Global Peace Index (GPI), it is possible to predict large falls in peace. A model based on Positive Peace deficits was able to predict 90 per cent of the countries that would deteriorate in peace over the past decade. Additionally, seven of the ten largest falls on the GPI were also predicted by this model.

The data used in this report covers the period from 2009 to 2019. As such, it does not include the impact of the COVID-19 pandemic, lockdowns and the global recession that ensued. It will be included in forthcoming editions of the Positive Peace Index (PPI), as well as other upcoming IEP publications such as the GPI and the Business and Peace report.

Analysis finds that Positive Peace is strongly correlated with better economic outcomes. Countries that develop high levels of Positive Peace display greater degrees of economic strength and resilience. Countries that improved in Positive Peace between 2009 and 2019 had annual per capita GDP growth almost three percentage points higher than countries that deteriorated in Positive Peace. As such, Positive Peace can be used in financial markets helping investors identify reliable and sustainable growth opportunities. In addition to improvements in GDP, Positive Peace is statistically associated with better performance in a range of other macro-economic indicators, including stronger flows of foreign direct investment, appreciating currencies and lower and more stable interest and inflation rates.

Trends in Positive Peace can be used to forecast future economic outperformance in countries. This is an invaluable tool for financial analysts seeking to complement their traditional macroeconomic forecasting models. This analysis is discussed in this report and will be further developed in the upcoming Business and Peace publication.

Positive Peace is also conceptually and empirically linked with the notion of ethical investing, or as it is often described, environmental, social and governance (ESG) investing. Positive Peace is statistically linked to improvements in ESG measures and as such can be seen as creating the background environments where countries will perform well in such measures. Positive Peace can be used as a predictor of superior ESG performance and can be applied in the design of impact- type investment strategies or as a risk assessment and management tool.

Global levels of Positive Peace have improved since at least 2009, with 134 of the 163 countries, or 82 per cent, improving in the PPI over this period. Positive Peace improves slowly, therefore planning needs to be longitudinal. Much of the progress since 2009 is due to improvements within the Structures domain of Positive Peace, which includes measures related to economic, technological and scientific development. They tend to grow almost uninterruptedly, reflecting the continuous increase in national incomes, the constant development of new technologies and the permanent stream of new discoveries in science and health.

In contrast, factors relating to social behaviour and social relations, as measured by the Attitudes domain, have deteriorated considerably over the past decade. These factors measure social views, tensions and perceptions and have been negatively affected by a rise in corruption, greater polarisation of political views, the intensification of tensions between social groups and the dissemination of false information. Some countries have experienced steep declines in this domain, including developed countries, such as Denmark, the Netherlands, Austria, the US and the UK.

Six of the eight Pillars of Positive Peace have improved over the last decade. The Pillars with the greatest improvements were Free Flow of Information and Sound Business Environment. These developments mostly reflect the dissemination of information technologies and the growth in goods and services consumption and trade. High Levels of Human Capital also improved markedly, on the back of greater access to education and professional training. It was also influenced by increased technical and scientific research output.

However, the Pillars Low Levels of Corruption and Well- Functioning Government, deteriorated globally. Either corruption itself has become more prevalent over the last decade or perceptions of it have deteriorated. Overall, Low Levels of Corruption deteriorated in 103 of the 163 countries assessed by the PPI. In line with these developments, governments have also become less effective and reliable, with the Well-Functioning Government Pillar deteriorating in 98 countries since 2009. These are serious concerns.

The research also incorporates systems thinking, which provides a more accurate understanding of how nations operate and societies develop over time, rather than the traditional approach of cause-and-effect linear thinking. The introductory section of the report describes the fundamental concepts associated with systems thinking. Adopting this approach, IEP develops a new interdependent framework and holistic methodology to the study of peace and societal development.

When combined with systems thinking, the analysis of Positive Peace produces a new theory of social change. Developments in Positive Peace precede societal changes in peacefulness, either for better or worse. Stimuli and shocks have cascading effects, due to the feedback loops contained within national systems, pushing societies into virtuous or vicious cycles. However, these cycles can be understood, planned and moulded to produce the best social outcomes. Positive Peace provides a roadmap of the things societies need to change, to either consolidate virtuous cycles or break vicious ones.

Each Pillar of Positive Peace represents a complex set of social dynamics. Research finds that different Pillars become more important at distinct stages of development. In low-peace countries — those struggling with external wars, civil wars or internal insurgencies — improvements in the Pillars Low Levels of Corruption, Acceptance of the Rights of Others, Good Relations with Neighbours, Sound Business Environment and Well-Functioning Government are critical for the reduction of violence. As countries progress toward higher levels of peacefulness, further reductions in violence require improvements in Free Flow of Information, Equitable Distribution of Resources and High Levels of Human Capital. The eight Pillars build on one another to consolidate previously acquired successes.

Additionally, improvements in a single Pillar, without improvements in other supporting Pillars can lead to a higher likelihood of deteriorations in peace. Focusing exclusively on building stronger business environments or higher levels of education, for example, may prove to be problematic. Countries, like systems, evolve and therefore the unique factors which constitute the make-up of a country need to be understood for interventions to be successful. Radical change also creates instability and risk. The best approach is many small, progressive nudges towards virtuous cycles of greater Positive Peace. Once a cycle is underway, it tends to be self-reinforcing. This is the nature of systems.

Taken together, the findings in this report have important implications for building and sustaining peace:

• There are no quick and easy solutions. Building and sustaining peace requires a large number of society-wide improvements progressing in concert with one another over long periods of time.

• Simply addressing the factors that led to violence in the past will not be enough to sustain peace in the future. Different aspects of the social system push societies towards or away from peace, which means that improvements in peace require broader and more systemic strategies than once thought.

• Prevention should be the priority. Recovery after violence has already occurred is difficult, expensive, and requires widespread effort to rebuild Positive Peace. Through focusing on the factors that are most critical, it is possible to build resilience in cost-effective ways.

• Stopping or averting conflict is not an end in itself. As Positive Peace progresses, it enables an environment where human potential may more easily flourish.

Positive Peace can also be applied practically through workshops and development projects on a national, state or community level. IEP has implemented workshops in all major regions of the world. Included in this report are examples of IEP programmes conducted in the Philippines, Ethiopia, Mexico, Uganda and Japan, all aimed at building Positive Peace in these countries and communities.

Without a better understanding of how societies operate, it will not be possible to solve humanity’s major global challenges. Positive Peace provides a unique framework from which to manage human affairs and relate to the broader ecosystems upon which we depend. Positive Peace in many ways is a facilitator, making it easier for workers to produce, businesses to sell, entrepreneurs and scientists to innovate and governments to serve the interests of the people.

The 10 Countries that are Highest in Positive Peace

🇳🇴 1. Norway
🇮🇸 2. Iceland
🇫🇮 3. Finland
🇨🇭 4. Switzerland
🇸🇪 5. Sweden
🇩🇰 6. Denmark
🇳🇱 7. Netherlands
🇮🇪 8. Ireland
🇳🇿 9. New Zealand
🇦🇹 10. Austria

The 10 Countries that are Lowest in Positive Peace

🇸🇴 1. Somalia
🇾🇪 2. Yemen
🇸🇸 3. South Sudan
🇪🇷 4. Eritrea
🇨🇫 5. Central African Republic
🇹🇩 6. Chad
🇸🇾 7. Syria
🇨🇩 8. Democratic Republic of the Congo
🇬🇶 9. Equatorial Guinea
🇸🇩 10. Sudan

Download the full Positive Peace 2020 report here.

Key Findings

Positive Peace Fundamentals

Positive Peace is defined as the attitudes, institutions and structures that create and sustain peaceful societies.
These same factors also lead to many other positive outcomes that society feels are important, such as economic strength, social resilience and wellbeing.
Therefore, Positive Peace creates the optimal environment for human potential to flourish.
The most peaceful countries in the world perform strongly on all eight Pillars of Positive Peace.
High Positive Peace countries are more likely to maintain stability, adapt and recover from shocks.
Countries that perform well in Positive Peace are more likely to achieve and sustain high levels of peace.

Global and Regional Trends

More countries improved in Positive Peace — 134 in total — than deteriorated — 29 countries — from 2009 to 2019.
These improvements were mainly driven by
the Sound Business Environment, Free-Flow of Information, Equitable Distribution of Resources and High Levels of Human Capital Pillars.
Positive Peace improved 3.3 per cent globally in the past decade. This is driven by improvements in six of the eight Pillars of Positive Peace since 2009.
Eight out of the nine world regions improved in Positive Peace since 2009, with North America being the only exception.
Russia and Eurasia, Asia Pacific, South Asia and Europe had the largest regional improvements. All countries in Russia and Eurasia recorded improvements in the PPI.
Higher levels of Positive Peace are mainly due to improvements in the Structures domain of the PPI, while the Institutions domain was broadly steady and the Attitudes domain deteriorated markedly.
This means the world has become richer and more apt at technology, but the ways in which we treat one another have become measurably more intolerant.

Positive Peace, Ethical Investment and Resilience

Positive Peace has a high correlation with indicators of environmental, social and governance (ESG) investment. Designers of financial products and benchmarks can use this when catering for the growing demand for ethical investment.
Positive Peace is a reliable gauge of economic resilience. As such, it can be used to select portfolios of countries that consistently outperform global GDP growth. The combined GDP of PPI improvers outgrew global averages by almost one percentage point per year since 2009.
This outperformance is also verified for other indicators of macroeconomic activity and national governance.
The PPI can also be used as a tool to help forecast future economic outperformance in sovereign markets.
Inflation rates in countries where Positive Peace deteriorated were four times more volatile when compared to countries where Positive Peace improved.
Domestic currency in countries where Positive Peace improved appreciated by over one percentage point per year more than countries where the PPI deteriorated.
Countries that improved in Positive Peace also have a more positive outlook on credit rating as assessed by Standard & Poor’s, Moody’s and Fitch.
Among countries where Positive Peace improved, household consumption rose in the past decade at a rate almost twice as high as for countries where the PPI deteriorated.

Positive Peace & Changes in the Global Peace Index

Countries that have a higher rank in negative peace than in Positive Peace are said to have a Positive Peace deficit. This is where a country records a level of peacefulness higher than can be sustained by its internal socio-economic development. Most countries found to be in deficit subsequently record increasing levels of violence.
Sixty-nine per cent of countries with a Positive Peace deficit of 20 places or more in 2009 had substantial deteriorations in the Global Peace Index (GPI) from 2009 to 2019.
When the threshold is raised to 50 places, the proportion of deficit countries experiencing subsequent increases in violence rises to 90 per cent.
The ten largest deteriorations in the GPI ranking from 2009 to 2019 were recorded by Libya, Nicaragua, Burkina Faso, Egypt, Syria, Bahrain, Mozambique, Cameroon, Tunisia and Ukraine. Of these ten countries, seven had large Positive Peace deficits in 2009. This underscores the predictive power of the Positive Peace deficit model.
On average, deficit countries that recorded increases in violence saw their GPI Internal Peace score deteriorate by 17.8 per cent from 2009 to 2019. This compares to a 0.3 per cent deterioration over the period for the median country in the GPI.
Looking forward, 30 countries recorded substantial Positive Peace deficits in 2019, and may deteriorate further into violence in the coming years. Of particular concern, Eritrea and the Equatorial Guinea combine large Positive Peace deficits with a long trend of PPI deteriorations over the past decade.
Other nations in deficit in 2019 — such as Liberia, Zambia, Guinea-Bissau, Bangladesh, Qatar, Rwanda and Zimbabwe — have already recorded PPI deteriorations in more recent years.

Low Levels of Corruption, Acceptance of the Rights of Others, Sound Business Environment, Well-Functioning Government and Good Relations with Neighbours are the most important Pillars requiring improvement in countries suffering from high levels of violence.
Free Flow of Information, Equitable Distribution of Resources and High Levels of Human Capital become more important as countries move away from very low levels of peace.
Low Levels of Corruption is the only Pillar that is strongly correlated with the GPI across all levels of peacefulness. Improvements in this Pillar are associated with reductions in violence in low- peace, medium-peace and high-peace countries.
Uneven improvements in the Pillars of Peace can lead to increased violence, highlighting the importance of a holistic approach to building Positive Peace.

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Positive Peace Report 2020 Summary and Key Findings