Aon unveils 2011 Political Risk Map

by Gill Montia

Story link: Aon unveils 2011 Political Risk Map

Aon has published its 18th annual Political Risk Map, which measures the political risk of 211 countries and territories based on risks such as currency inconvertibility; strikes, riots and civil commotion; war; sovereign non-payment; political interference; supply chain disruption and legal and regulatory risk.

Counties are ranked on a six-point scale and 19 have been downgraded for the 2011 map, while 11 have been upgraded.

According to Aon Risk Solutions’ associate director, Beverley Marsden, the risk of sovereign non-payment continues to be an issue in countries across the globe.

This year’s map also highlights the continued emergence of several markets in Africa, where more international trade and investment is occurring, leading to a greater need for political risk insurance cover.

In fact, the director expects political risk to continue to be a major influencer for businesses transacting in emerging markets, in 2011.

However, the map has seen a rise of almost 30% in the number of countries in the middle rankings over the past five years, and Ms Marsden comments: “Globalization has been blamed for recent incidents of economic volatility, but it has also had a positive impact on global political and economic stability.”

Details of specific risks, such as war/civil war are available from the Aon website, the data having been produced in partnership with Oxford Analytica, which draws its analysis from a global network of over 1,000 experts, including senior faculty members at Oxford University.

Counties downgraded for 2011 are: Algeria, Benin, Comoros, Antigua and Barbuda, Bahamas, Barbados, Bermuda, Cayman Islands, Dominica, Grenada, Haiti, Antilles, St Kitts and Nevis, St Lucia, St Vincent, Trinidad, Myanmar, Iceland and Bahrain.

Countries upgraded are: Kenya, Mozambique, Rwanda, Uganda, Zambia, Panama, Georgia, Uzbekistan, Indonesia, Malaysia and India.