Only short-term gain for real economy

Osama bin Laden was finally killed in an operation in Pakistan on Sunday after being hunted by the United States for nearly 10 years. The news has had strong repercussions in the financial and commodity markets: The US dollar has risen and commodity prices have dropped. But taking a comprehensive view of the situation as a whole, the death of bin Laden is unlikely to profoundly influence the overall situation of the international economy.

The region where bin Laden was prevailing accounts for only a small share of the global economy and an even smaller share in the output of the real economy. The influence of bin Laden and Al-Qaida was mainly concentrated in countries in the Middle East and North Africa and according to the "World Economic Outlook", issued by the International Monetary Fund in April 2011, these areas account for only about 5 percent of real global GDP.

The effects of bin Laden's death will mainly be concentrated in the financial sector and the virtual economy, rather than the real economy, but if his death affects the fundamentals of the real global economy, Washington should take the opportunity to declare a successful end to the war on terror and reduce its excessive military intervention overseas, so as to avoid depletion of its national power.