India Least Resilient and Most Exposed to Global Risks
Tuesday, 21 February 2012, 18:51 IST   |    9 Comments
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"With hopes for a global economic recovery resting with the BRICs, investors and business seeking new high-growth, high-risk markets need to be aware of their limited resilience to global risks," Maplecroft CEO Alyson Warhurst said. Brazil however is "largely buffered" from the destabilising influences of global risks, than the other BRICs counterparts, owing to its to its strong democratic governance and regime stability.
India, risk
However, poor governance and a relative lack of societal resilience could undermine the ability of countries like India, Russia and China to combat any unexpected events of large magnitude and consequence, the report said. "Poor governance and a relative lack of societal resilience in India, Russia, and China are identified as significant factors that could undermine their ability to combat the effects of 'black swan' events," the survey said. "A country's resilience to external and internal shocks is built up over time, so as the BRICs political risk environment improves we might see resilience strengthen, but our results reveal this is yet to happen," Warhurst said. The survey covered 178 countries and analysed their exposure to macroeconomic risk, security, resource security, climate change and infectious diseases. It also evaluated governance and societal resilience to measure how prepared nations are to adapt to the impacts of global risks. "Improvements in basic social infrastructure, such as education, healthcare and sanitation for large sections of society, are vital in combating the impacts of global risks. Without these, and improvements in governance, the BRIC economies may not fully realise their investment potential," Warhurst added. The study has named New Zealand, Finland, Denmark, Norway and Canada among the safest investment destinations in terms of their exposure and resilience to major risk events.
Source: PTI