But appearances can be deceiving. Admiral Harris warns that the US should prepare for a war against China.
Political Risk Map Tensions and Turbulence Ahead Inthe global political risk landscape was turbulent, and is likely to remain so over the next 12 months.
For example, tensions between North Korea, the US, and other countries have risen as North Korea continues to conduct missile tests. At the same time, the risk of increased global trade protectionism continues. BMI Research predicts that trade giants — such as the US — will seek further restrictions inafter a brief decline in such measures being implemented in Meanwhile, succession risks dominate the political risk landscape in many African countries.
And the threat of terrorism remains a concern, evidenced by attacks in Europe, Africa, Asia, and elsewhere in Below, we look at key developments in each region that are likely to affect the political risk landscape throughout Forthis is expected to continue, and could include changes regarding global trade, with China potentially a key target.
The US mid-term congressional elections will be held in November for the Senate and House of Representatives, both of which currently have a Republican majority. A shift in power to the Democrats could create greater political gridlock. The uncertainty caused BMI Research to increase its estimate of political risk in each of those countries, as portrayed in the short-term political risk index STPRin which lower scores represent decreased stability.
Venezuela has experienced continued unrest throughout as a result of an economic crisis, which has continued to weigh on its STPRI, now at As talks continue, the risk that the UK will leave without a deal becomes greater, and companies may need to prepare for such an eventuality.
In Spain, political instability has persisted since August in Catalonia, as some there push for independence. Terror attacks in Barcelona, London, Sweden, and elsewhere in Europe in have kept terrorism a major security concern.
Elsewhere, the rise of far-right parties in created uncertainty around upcoming elections.
General elections in Italy will take place in Marchraising concerns over whether anti-establishment and Eurosceptic parties, including the 5-Star Movement, will prevail. Current opinion polling suggests that the opposition centre-right bloc consisting of Forza Italia and Northern League LN looks set to emerge as the largest in parliament, but fall short of a majority.
This could result in extended negotiations over coalition building, and the eventual formation of a weak government. Greece experienced improvement in its political risk outlook, owing to greater policy stability and improved relations with its international creditors.
AFRICA The African region once again saw some of the biggest improvements in political risk scores, but also some of the most notable deteriorations.
Succession risks in Africa reached a decisive peak in In Zimbabwe, Robert Mugabe resigned from power after 37 years, and the transition to Emmerson Mnangagwa appears to have gone smoothly, reducing the risk of political disruption in the country and improving its STPRI score from However, uncertainty around elections and successions led to sharp increases in political risk in several countries.
At the same time, Qatar continues to face a diplomatic crisis, while tensions between Saudi Arabia and Iran remained heightened. Other risks in the region stem from conflict between Israel and Hezbollah in Lebanon, between Israel and Hamas in Gaza, and more broadly, the risk of a new Palestinian uprising against Israel.
North Korea has typically used important anniversaries to conduct missile tests, and BMI Research believes it will do so again this year. In the South China Sea, tensions between China, South Korea, Japan, and Vietnam over disputed islands remain, but did not develop further in the latter half of Social instability and adverse government actions are among the most common examples of political risks that multinational organisations face when trading or investing in foreign countries.
Does this mean businesses should forego opportunities if they happen to be in potentially unstable areas? While political risks are typically not directly controllable, in many instances they can be mitigated through credit and political risk insurance, providing greater confidence in the benefits of the opportunity.
But companies should keep in mind that this strategy has the potential to leave significant gaps. Whether it is a political violence or a terrorism insurance policy that responds to a claim often depends on how insurers and governments view specific events.
In some instances, terrorism and political violence insurers have denied coverage, claiming that a particular event should be covered under the other type of policy. Alternatively, political risk insurance can help bridge gaps by including coverage for both perils, potentially avoiding such disputes.
Trade contracts for the supply of goods and services with government or private entities in emerging countries are often exposed to a number of underlying political risks. Increased global protectionism, the restriction of hard currency payments to overseas companies, and the imposition of trade embargoes and sanctions are recurring issues in countries where governments attempt to enforce foreign policy objectives, influence domestic public opinion, or manage economic issues.
Moreover, companies may find themselves faced with internal counterparty limit constraints that keep them from competing effectively in target markets. Contracts can be covered for terms of up to three to seven years or, if a buyer holds sovereign status, more than 10 years.
This interactive map rates countries on the basis of political and economic stability, giving insight into where risks may be most likely to emerge and issues to be aware of in each country. For more information on BMI research, visit their website:Research Article Toward a legitimacy-based view of political risk: The case of Google and Yahoo in China.
Danson Cheong is one of The Straits Times' China correspondents, covering developments out of the Beijing bureau. He was previously on ST's political desk where he focused on security, terrorism. Get the latest science news and technology news, read tech reviews and more at ABC News.
Jan 25, · How the battle was won. China didn’t openly re-retaliate against the freeze in approving extra flights, but it essentially won the battle.
It had a massive advantage. TOWARD A LEGITIMACY-BASED VIEW OF POLITICAL RISK: THE CASE OF GOOGLE AND YAHOO IN CHINA CHARLES E.
STEVENS,1* EN XIE,2 and MIKE W. PENG3 1 Department of Management, Lehigh University, Toward a legitimacy-based view of political risk: the case of . BuzzFeed CEO Jonah Peretti suggests the site could eventually merge with rival publishers to negotiate better terms with companies like Facebook and Google — Jonah Peretti, the chief executive, says his company could eventually merge with other online publishers in order to negotiate better terms with tech platforms like Facebook.