The Cost of Terrorism

Economic impact of terrorism related incidents

According to the 2015 Global Terrorism Index, the cost of terrorism to the world was $52.9 billion in 2014, the highest value since 2001, and a tenfold increase on the same value in 2000.

The cost has been proportionately higher in certain economies as the following examples indicate:

  • In Nigeria, terrorism has caused foreign direct investment to drop by $6.1 billion or 30%
  • Since 2005, terrorism has cost Iraq over $159 billion, or 32% of GDP
  • The total economic costs of the 9/11 attacks has been estimated by the New York Times at a staggering $3.3 trillion dollars

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A detailed study on the economic impact of the terror attacks in Paris on Nov 13, 2015 found four distinct economic impacts which are applicable to terrorist attacks in any major Western city

  • The first impact is an immediate and sustained decrease in tourism which typically affects the whole country, not just the area where the incident occurred
  • The second impact is a decline in consumer spending as consumers reduce their exposure to large public spaces in the city such as shops, cafes, restaurants and major sporting events
  • The third impact in the psychological impact on consumers – the threat of terrorism has been shown to have a significant impact on consumer sentiment which results in families delaying major expenditure such as new cars, consumer electronic and holiday
  • The fourth impact is the significant costs and productivity lost through increased security measures including screening and access control to public spaces

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A study conducted by economists in the United States found that the economic effects of the publics change in behaviour are 15 times more costly that the immediate damage in the wake of an incident.  When surveyed 41% of shoppers would still avoid an area where an incident had occurred and employees would require a 45% increase in wages to return to their jobs.  The study also found that increasingly the threat of terrorism (without actual incidents occurring) also had a significant impact on the way people behaved.

In Australia, ASIO has confirmed that security operations have prevented 4 mass casualty attacks since September 2011.  Victorian police have similarly conducted numerous raids aimed at disrupting potential attacks, most recently prior to Christmas.

It is also important to consider the cost of ‘false alarms’ or false positives which occur when a full security response is activated in response to a suspicious object or activity which ultimately turns out to be innocent.

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In Melbourne these types of incidents have become increasingly common:

  • Aug 30, 2014 – Closure of the Bourke Street mall and surrounding streets following a hoax bomb threat
  • 23 January 2015 – Elizabeth Street in Melbourne’s CBD was evacuated after a bomb threat
  • Nov 17 2015 – Several streets in the Melbourne CBD were closed and buildings evacuated after a suspicious shoebox was abandoned in Collins Street near Southern cross station
  • January 10, 2015 – Closure of Terminal four at Tullamarine airport after a hoax bomb threat
  • November 20 2015- Evacuation and lockdown of Station Pier after the reporting of a suspicious package
  • January 12, 2017 – Evacuation of the Moorabbin justice complex after a bomb threat

In all of these incidents the locations were subject to lengthy lockdowns and / or evacuations.

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Determining the short term economic impact for these is at one level relatively simple – lost productivity from workers forced to evacuate or locked down and lost retail turnover both during the incident and in subsequent weeks.  Whilst this understates the true cost of these ‘false positives’ it provides ample evidence that these events are extremely costly and this cost could have been prevented if a cheaper and quicker way could have been utilised to determine the true risk.

As an example, using our modelling methodology, the 2014 closure of the Bourke Street Mall resulted in retail losses in excess of $200,000 on that day alone.  The evacuation of buildings surrounding Southern Cross station in 2015 as the result of the suspicious shoebox resulted in potential productivity losses in excess of $1 million.

Evolv – a better solution.

AML can now provide the Evolv Body scanning equipment for fast processing of large crowds. Each unit has throughput of 700 people per hour.

Watch the video here

Guidelines to protect Australians from terrorist attacks in stadiums, shopping malls and public transport hubs

NEW guidelines to protect Australians from terrorist bomb attacks in sporting stadiums, shopping malls and public transport hubs have been released.

The Australia-New Zealand Counter-Terrorism Committee has released the guidelines to help governments and businesses prepare for a possible improvised explosive device in places of mass gathering.

Minister Assisting the Prime Minister for Counter Terrorism, Michael Keenan, said the guidelines were to guard against the threat of IEDs and were not in response to any specific threat.

“We want to ensure places of mass gatherings are equipped to contribute to the collective national effort to manage any IED threat,’’ Mr Keenan told the Herald Sun.

“Sadly as we have seen overseas in recent months, crowded places, such as public transport hubs, shopping malls and entertainment precincts, can be vulnerable to terrorist attacks.

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“While Australia’s threat level remains at probable – which means credible intelligence, assessed by our security agencies indicates that individuals or groups have developed both the intent and capability to conduct a terrorist attack in Australia – the incidents overseas highlight the need to be prepared.’’

Crowded places such as public transport hubs are vulnerable to attacks. Pictures: Tony Gough

According to the guidelines, violent extremists and “disgruntled individuals’’ have specifically identified mass gathering places as attractive targets both in Australia and overseas.

They warn that terrorist attacks against targets in Western countries with similar security environments to Australia typically involve the use of small portable devices, devices hidden in vehicles, or mixed-mode attacks where terrorists use explosive devices and other weapons, usually firearms.

AML Risk Management Emergency Warden

“A terrorist attack in Australia using IEDs is likely to be low cost, involve minimal training, and make use of precursors that are widely available (eg from hardware stores, chemists and agricultural supply stores) and can be bought without raising suspicion,’’ the guidelines warn.

“An IED target is often chosen for its high symbolic or economic value, its potential to generate casualties and public anxiety, or its ability to gain media attention.”

The guidelines give details of how buildings can be made more resilient to IED attack, including by creating “stand-off’’ space to stop vehicles getting too close to buildings.

“Strategically placed objects such as spheres, planter boxes, seats or bollards on the pavement at entrances to (places of mass gathering) can provide extra protection from unauthorised vehicle intrusion as well as increasing stand-off distance,’’ the guidelines say.

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They further give advice on how to identify suspicious behaviour but warn it is not an exact science and nervous behaviour might be “typical for other settings, such as attending a job interview”.

“Consider these behavioural signals: continuous scanning of an area, unusual perspiration, heavy breathing, fidgeting, rubbing hands, pacing, clock watching, exaggerated yawning, avoiding security/uniformed officers,’’ it suggests.

The guidelines follow similar documents on terrorism in public places and active shooter guidelines.

Source: Herald Sun

Be Secure, Prepared and Protected

AML Risk Management are industry leaders in providing both the latest technical innovations and the appropriate teams, strategies and know how in deploying such technology and devices to ensure minimal risk, disruption or malicious attack in public and private locations.

The DetectaChem Trace Detection Unit is a state of the art unit and a good example of the innovative practices of AML Risk Management. The unit is most effective in identifying both explosives via chemical detection and illicit substances at control points. The AML Emergency Response teams are skilled in the operation and tactical use of this equipment, having provided such services at major sporting events and at the Melbourne Showgrounds.

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Not only are the APU (Asset Protection Unit) teams proficient in the detection of illicit, illegal and often dangerous substances, but they are trained and equipped in providing an emergency response, particularly where there is a risk of explosive devices. AML Risk Management provide a complete end to end emergency service including official handover to emergency services such as Police, Ambulance and Fire Brigade as well as providing all information and a continuing local presence as is required.

AML has access to a full range of first rate, up to the minute equipment suitable for use in public venues where high risk is predicted.

This includes equipment from ‘evolv technology’ designed to achieve the detection of person borne Mass Casualty threats. These units are particularly applicable in use for softer targets traditionally ignored by Terrorists, such as special event locations (conventions, expo’s, speaker events), office buildings, hotels, shopping malls and retail precincts, places of worship, transportation hubs (Railway stations, bus depots) and sports stadiums.

‘Walk thru’ devices quickly identify potential threats, with traffic enabling up to 600 people per hour. The devices detect potential threats that traditional metal detection units do not. These units are small, portable and enable random temporary screenings and random protocols.

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Please visit the AML Risk Management website for more detail on AML Risk Management’s services. We will continue with more information on these innovative and effective units next week as well as discussing crash barrier devices and technology for public spaces requiring real protection for pedestrians and the public spaces they traverse.