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Risk Map 2019

Political risk seems to be the major factor driving Control Risk’s ’Top 5’ in its Risk Map 2019.

“In 2019, what started as a trade war will ultimately harden into a more permanent stance,” said Richard Fenning, CEO of Control Risks. “The confrontation on trade between the United States and China will become the defining geopolitical dynamic. This antagonistic relationship will complicate life, not only for businesses in China and the US. Companies in a wide orbit around this stand-off will feel the political and economic impact.”

Last year, Control Risks released their Risk Map 2019, looking at the some the global political risks that businesses should have on their radar.

These Top 5 risks differ from those outlined in their Risk Map 2018, which demonstrates how much can happen in a year.

From cyber risks, to the potential war on the Korean peninsula, or regional rivalries, three keys risks from Risk Map 2018 in the middle east did not make the Top 5 cut for the Risk Map 2019.

Concerns over nationalism and or protectionism and its impact on international business remains the same.

  1. The Risk Map warns that the antagonistic relationship between the US and China will ‘harden’ into business-as-usual. They suggest the trade war with China will become a double-edged sword for Asia and will force them to diversify their supply chains.

  2. They predict a continued global data regulations stand-off highlighting the different perspective of what data is and how it should be handled. According to the Risk Map, “For China, data is something to be controlled; for the EU, data is something to be protected; and for the US, data is seen as something to be commercialised.” Control Risks indicates that this would prove particularly challenging for organisations and how they process data.

  3. Control Risks also highlights the political uncertainty as a result of the legislative gridlock in the United States.

  4. Environmental Regulation will rise in response to the extreme weather conditions that have been created by climate change. They believe that 2019’s weather-related insurance claims will surpass the previous years’.

  5. Finally, the increase of nationalist politics is having an impact on trade, and specifically on multinational companies, and what Control Risks defines ‘informal and formal barriers’ are beginning to rise.

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