Tag Archives: Credit risk

U.S. Elections Add to Growing Political Risks Businesses Face

The 2016 U.S. presidential election is one of the rising political risks facing businesses and investors in the year ahead, according to Marsh’s Political Risk Map 2016.

Terrorism and struggling emerging economies, such as China and Russia, are also among the growing political risks businesses face.

Marsh notes that the recent terrorist attacks in Paris and San Bernardino, California have intensified political rhetoric and brought foreign relations and defense policy topics to the forefront.

With polls showing national security to be a major concern for voters, foreign policy will remain a key theme on the campaign trail in 2016 – and will be top of mind for the next presidential administration.”

Marsh observes that in the last decade multinational organizations have undertaken unprecedented international expansion, leaving them exposed to global credit and political risks like never before.

And those risks–including terrorism and political violence, armed conflicts, increasingly powerful anti-establishment political movements, and persistently low commodity prices–continue to grow.

Against this backdrop, it’s critical for businesses to be prepared for the possibility that political violence, unrest, or other large- scale crises will quickly develop in virtually any part of the world – including those countries that were historically seen as safe or stable, Marsh says.

Companies can prepare for these risks by managing their credit risk, building resilient supply chains, protecting their people and by protecting their assets through insurance.

Marsh notes:

Credit and political risk insurance can protect against a variety of risks, including expropriation, political violence, currency inconvertibility, non-payment, and contract frustration.”

Marsh’s Political Risk Map 2016, with data and insight from BMI Research, presents country risk scores for more than 200 countries and territories, helping businesses and investors make smarter decisions about where and how to deploy financial resources–including risk capital–globally in 2016 and beyond.