In a scathing new report, the International Development Economics Associates Limited (IDEAs) has documented the heavy toll Global South continues to pay for a war it did not create — as corporations cash in.

The report describes a state of siege across the Global South region, with countries facing mounting economic pressure as the fallout from the US-Israeli war of aggression against Iran spreads.

Global South picks up the tab

The report stated that operations of Epic Fury waged by the US, and Roaring Lion waged by the colonial-settler state Israel have led to substantial hardship for countries throughout the global south.

real and financial effects being felt across the three continents of Africa, Asia and Latin America and the Caribbean, due to the contraction of energy supply and rise in energy prices.

NEW REPORT: “The War on Iran and the Global South”, focusing on significant realised & potential economic impacts of US–Israeli war on Iran & the #GlobalSouth, & analysing transmission channels through which the effects of conflict are likely to unfold. https://t.co/qmkuiLT6W2 pic.twitter.com/bx9jqWwrbo

— International Development Economics Associates (@DevEconNetwork) July 14, 2026

While defense contractors, oil giants, and Wall Street banks reaped record profits, countries across Asia, Africa, and Latin America watched their economies crumble, their food supplies dwindle, and their people succumb to a crisis thousands of miles away of Trump and Netanyahu’s making.

The report criticises these Western corporations: their actions have intensified economic challenges particularly for many nations in the south, many of which are deeply affected by global policies.

There have been a few winners able to exercise their economic power to benefit from an otherwise damaging set of developments. Defence companies have seen exponential and sustained gains. Lockheed Martin, Northrop Grumman and RTX Corporation are some of the major beneficiaries of the war, with Lockheed Martin’s stock price increasing nearly 40% since the beginning of 2026. The US remains the world’s largest military spender and arms exporter and it has proposed a $1.5 trillion defence budget for the financial year 2027, the largest in history and a 50% increase relative to financial year 2026.

The war has also boosted profits of global giants in the energy sector. According to estimates from diverse sources, Shell, BP and TotalEnergies reported extra earnings of between $3.3 bn and $4.75 bn in the first quarter of 2026. US Commercial banks have also reaped huge sums of profit in a short period of time.

As central facilitators of global finance, major Wall Street banks are capitalising on the current volatility through a surge in trading activity.

Hedge funds and operators in prediction markets also emerged as significant profit takers. In the first few weeks of the war, hedge funds increased their net-long positions on Brent crude.

Asia feels the sting

The report states that challenges facing Asia are a microcosm of issues affecting the South on a global scale.

the impact of the ongoing war will be particularly severe on countries in the Asian continent due to their geographical proximity with Iran and the Gulf countries.

Nations like Pakistan, the Philippines, and Vietnam face dire consequences, who, as is explained in the report, represent significant populations within the global south socioeconomic landscape.

both source between 85-90 percent of their oil from the Middle East, [and] are likely to face dire effects.

They added that across Asia: countries have brought into force various kinds of austerity measures such as energy rationing… moving to a four-day work week… and requiring airlines to switch to emergency operations mode.

It notes that China is relatively unscathed as it:

took the precaution of building considerable reserves equivalent to several months of [oil] imports, allowing it to weather a temporary shock and smooth the effects of a price spike.

The report warns that the overriding risk for countries in the south is a balance-of-payments crisis as the fallout from the war deepens and influences global conditions.

The forgotten victims of the Global South

It also stated that the war has hit Gulf-based migrant workers hard.

They note that migrant workers — estimated at 25 million across the Gulf — comprise between 76 and 96 percent of the labour force, describing them as the “backbone of these economies” and demonstrating how the movement of people from the south impacts global economies.

The report details how: migrants from the south, particularly, have been disproportionately affected by the conflict.

migrant workers are frequently situated in labour camps or exposed areas (such as construction sites, ports, and airports) that are less protected from military attacks.

Employers are also reportedly using the war as a pretext for withholding wages, denying exit, or dismissing workers without compensation in contravention of existing laws.

Economic shocks ripple into Africa

Meanwhile, Africa is being pummeled by the “5Fs” — fuel, freight, fertilizer, food, and finance. As the IDEAs’ report notes, African countries despite not being directly involved:

are, in direct or indirect ways, exposed to its devastating effects due to the continent’s structural external vulnerabilities.

rising energy prices do not necessarily translate into a net gain for African exporters, given the potential slowdown in global growth and the simultaneous rise in import costs.

[The war] can have lasting impacts on global fertilizer production and trade… compromis[ing] food security in African countries, especially Eastern African ones.

They added that:

For Africa, the war against Iran aggravates an already precarious African debt situation. Twenty-two sub-Saharan African countries figure among those with the highest ratios of external interest or principal payments to revenues, and collectively account for 44 percent of total interest payments of all low-income countries (LICs) projected over 2024 to 2027 (IMF, 2025).

These vulnerabilities mirror struggles seen throughout the Global South more broadly, and devastatingly.

Latin America and the Caribbean feel the squeeze

Energy-importing economies, particularly in Central America and the Caribbean, are likely to face worsening external balances and inflationary pressures, as well; these regions are key components of the global south.

The countries most exposed to rising international prices are those most heavily reliant on energy imports, including the Dominican Republic, Chile, Nicaragua, Uruguay, and El Salvador, the report adds.

Epic Fury (United States) and Roaring Lion (Israel) leave behind an economic trail of misery, Lockheed Martin, BP, and other corporate giants reap the rewards — and the Global South pays the price.

Featured image via the International Development Economics Associates Limited (IDEAs)

By Nandita Lal

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