African nations are riskiest places for big businessOctober 2009
African countries carry the greatest risks for multinationals, according to a ranking of nations with the most hazardous business environments.
The Global Risks Index, produced by the research firm Maplecroft, analyses the stability of countries and their business environments based on macroeconomics, governance, climate change, disease, security and ‘societal resilience’, which includes human rights and poverty issues.
The index rates Somalia, Sudan, the Democratic Republic of Congo, Chad, Afghanistan, Ethiopia, Burma, Nigeria, Burundi and Zimbabwe as the ten riskiest countries in a total of 163.
Other challenging nations for the business community include Pakistan (16th), India (27) Indonesia (32), Iran (35) and the Philippines (41), which are all rated as ‘high risk’. The only countries in Europe not awarded a ‘low risk’ rating are Bosnia and Herzegovina, Turkey, Moldova, Ukraine, Belarus and Russia.
Of the emerging economies, India is deemed the most risky for business, partly because of its population density, security problems and issues with resource security. Brazil (92), Russia (69), and South Africa (87) are all rated medium risk.
China is ranked 70th, with risks derived from resource security and the long-term effects of climate change. Competition for land and water are also risks, though Maplecroft says China is making significant strategic investments to mitigate some of these effects.
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