LONDON (Reuters) - The economic downturn has made the world more violent and unstable in the last year, according to a study Tuesday that ranked New Zealand as the most peaceful country and Iraq the least.
The impact of high food and fuel prices in early 2008 and the deepening recession later in the year eroded peace, according to the Global Peace Index, compiled by a unit of The Economist magazine group.
Economic weakening has increased political instability, demonstrations and crime in some countries, according to the study, which is online at www.visionofhumanity.org/gpi/home.php.
"Rapidly rising unemployment, pay freezes and falls in the value of house prices, savings and pensions is causing popular resentment in many countries, with political repercussions," the report says.
Iceland, the most peaceful nation last year, fell to fourth place after violent protests over its economic meltdown.
"There is a very, very strong correlation between peace and wealth," Steve Killelea, founder of the Global Peace Index, told Reuters. "Peace is a leading indicator on economic prosperity."
New Zealand replaced Iceland at the head of the table of 144 countries. The top 10 included all the main Scandinavian nations as well as Austria in fifth place, Japan seventh and Canada eighth.
New Zealand's rise was in part due to the election of a new coalition government with a strong parliamentary majority in November 2008 and its low homicide rate and defense spending.
The survey ranked countries on 23 indicators including political stability, warfare, human rights, murder rates, military spending, international relations and the risk of terrorism.
The authors of the study, now in its third year, said "small, stable and democratic countries," mainly in Europe, consistently ranked highest.
The United States rose six places to 83rd, wedged between Ukraine and Kazakhstan, after researchers cut its risk of a terrorist attack. China was unchanged from last year at 74th, while Russia was near the bottom of the list at 136th.
The bottom three countries were Iraq, Afghanistan and Somalia, described as being in a "state of ongoing conflict and upheaval."
Editing by Andrew Roche