Nationalist politics identified as biggest risk for European businesses in 2019
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2019 will be a testing year for companies that have not adjusted operations during the gradual shift in the business landscape from frictionless global trade to nationalist policies and regulation. This is one of the key findings of RiskMap2019, a publication forecasting political and security risk for business leaders and policy makers across the world, by specialist global risk consultancy Control Risks.
Daniel Vassall-Adams, director and head of Control Risks' Zurich office, elaborates: "Until recently, global business operations could count on being buoyed by established economic waters as a result of globalisation. A few years ago, the plug was pulled. 2019 will reveal the companies that have thoroughly prepared for the new economic reality - and those who have not. For the latter, the final call has been made to adjust their operations towards greater adaptability in these uncertain times."
Control Risks' top-five global risks for 2019
1. US-China trade rift foretells a new global order
The US-China trade confrontation will define global geopolitics in 2019. Friction between these two nations will complicate business not only for those European businesses operating in both countries but also for those with connections several times removed.
2. The global data rollercoaster
The stand-off between the three major data regulation ideologies will present a new level of risk for international business in 2019. For China, data is something to be controlled; for the EU, it is something to be protected; for the US, it is something to be commercialised. Businesses must be prepared for the challenge of collecting, storing and transferring data within and between these three domains against a backdrop of inconsistent enforcement and escalating cyber security threats.
3. US political gridlock
The vice of legislative gridlock will close on policy making in Washington and throw the US into a period of political uncertainty. Resurgent Democrats in the House of Representatives will seek to scrutinise the president under an investigative lens. Pushback from a Republican Senate and White House will erase any hopes of consistency for business operations. Trade policy will remain unpredictable; the pace of deregulation will slow.
4. Extreme weather disruption
Some of worst business disruption in 2019 will stem from extreme weather and its consequences. From storms to floods to droughts and forest fires, the costs of interrupted production, distribution, sales and travel will skyrocket in 2019. Last year's record for weather-related insurance claims will likely be surpassed.
5. Multinationals becoming nationless
As globalised companies enter 2019, they risk becoming nationless nomads, as nationalist politics continue to advance across the world. Formal and informal barriers are rising. Frictionless trade is beginning to rub, supply chains are starting to drag. Business leaders must recalibrate and adapt to this new reality, or global players will end up being played by a world in uncertain transition. While these top-five global risks will undoubtedly impact global organisations, Vassall-Adams reminds businesses "not to lose sight of what is happening on the ground at company level every day. Developments in far-flung markets and on home turf will be just as important for your business as the world of international relations."
About Control Risks
Control Risks is a specialist global risk consultancy that helps to create secure, compliant and resilient organisations in an age of ever-changing risk. Working across disciplines, technologies and geographies, everything we do is based on our belief that taking risks is essential to our clients' success. We provide our clients with the insight to focus resources and ensure they are prepared to resolve the issues and crises that occur in any ambitious global organisation. We go beyond problem-solving and provide the insight and intelligence needed to realise opportunities and grow. www.controlrisks.com
Contact:
Felicitas Sommer
+49 15904453336
felicitas.sommer@controlrisks.com