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The Gulf War - Essay Example

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Name Professor History and Political Science Date The Gulf War Gulf war has been the main general terminology for one of the worst clashes that people living in Europe and North America .The gulf war started in 1990, when Iraq invaded Kuwait in the grounds that Kuwait possessed a very quire behavior, such as not valuing an agreement on their established quotas as agreed between the two nations…
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The Gulf War
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"The Gulf War"

Download file to see previous pages After easily conquering Kuwait, Iraq began verbal attacks on Saudi Arabia, which forced the rest of the world to take a stern action against the stubborn Iraq nation. When Iraq defied all the warnings to leave Kuwait, a military action was the only remaining solution to cub that problem. The western world in collaboration with other wealthy nations contributed funds and security forces to fight Iraq. The gulf war negatively affected the economies of almost all nations, with the worst hit being the developing nations and it altered global democracy. The gulf war had a great negative effect on the world economy that was under pressure in recovering from the Second World War was threatened once again. Oil prices escalated at a great deal since Middle East countries are the major world oil producers because the war had interrupted oil mining and the exportation processes. The oil supply in Middle East countries reduced greatly up to a point where it could not meet global energy demands. Due to the scarcity of oil from major producers, the few Non- OPEC oil producing countries took advantage and hiked their oil prices and the customers did not have a choice but to dig deeper into their pockets. Those prices affected the budgets of various countries since a portion of money that had been set aside for other national projects had to be used to meet the rising cost of oil (Schwab 340). After the problem persisted for a long time, the global economy had taken a recession direction. Many developed nations opted to exploit on other sources of energy to meet their energy demands. Those unplanned new projects hampered development in those nations due to the increased expenditures that those countries did not anticipate. The cost of production of energy rose at an alarming rate, and the result was that the production cost of goods also rose. The increased cost of production further worsened the world economic status since most industries had reduced their production capabilities and they faced weaker purchasing powers. Most ended up in retrenching a good number of their workers thus increasing the rate of unemployment and overdependence at the same time. Annual revenues that governments earned from those companies reduced drastically forcing them to reduce funding the national projects and development of infrastructures. Free trade markets experienced acute shortages of various goods whose prices had also risen; the nations that relied on these products had to spend more to get them (Schwab 342). Since many sovereign states had cut down on the cost of development, it implied that they produced fewer goods to trade and thus they earned less from foreign exchange markets and in local trades. The poverty levels pushed up due to the increased rate of unemployment, thus posing a great threat to the nationals’ securities since a considerable number of people had turned into theft and other criminal acts to earn their daily bread (Cashman & Robinson 11). The developing states faced the worst economic crisis as compared to the developed countries primarily because those nations heavily depended on the imported goods from their developed neighbors (Costigan & Perry 301). The oil crisis forced those developed states to use more money from their budgets and they had to stall some of their projects ...Download file to see next pagesRead More
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