Political Risk, Terrorism and Political Violence Maps - 2019

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Populism, Protectionism and The Changing Face of Terrorism: Assessing the Threats

Terrorism & Political Violence

Political Risk

Terrorism & Political Violence

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From growing populist sentiment to shifts in terrorist ideologies, key findings from Aon’s 2019 Risk Maps provide insights and analysis across geopolitical trends impacting global trade.

How will U.S.-China trade tensions and tariffs impact the global supply chain?

What does rising populist sentiment mean for business?

How significant is the threat of national extremist terrorism in Europe and North America?

What security risks are posed as Islamic State fighters return to Southeast Asia?

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Political Risk

Whether it’s due to tariffs or risk of retaliation by governments, geopolitical tensions and rising populist sentiment can translate to increased costs of doing business causing a ripple effect on the global economy. This year’s analysis highlights:

Trade Relations Between Superpowers:

U.S.-China trade tensions are impacting economies. Tariffs could lower U.S. GDP by as much as 0.3% by 2023, while China’s may shrink by 0.6% in the same period.

Impact of Tariffs on Global Economy:

Trade tariffs are set to cap global economic growth – particularly in countries with high levels of public and private debt.

Volatility in Oil and Gas Prices:

In 2018, oil prices oscillated by more than 40% - from $85 a barrel to $50. Concerns about oil supply and demand were heightened by geopolitical events such as sanctions against Iran.

Superpower GDPs

China and U.S. GDP may contract by 0.6% and 0.3%, respectively, by 2023.

U.S.

0.3

China

0.6

How does populism impact the global business landscape?

Populism raises the prospect of politically motivated measures that can end contracts, stall high-profile projects, and force firms to reconsider their overall supply chains. And how can firms best prepare for increasing trade uncertainty stemming from populist agendas?

North America and Europe saw reduced levels of terrorist attacks motivated by Islamist extremism – and an increase in attacks motivated by national extremist beliefs

Evolving ideologies and changes in methods of attack continue to redefine terrorism

This year’s analysis dives deeper into the following areas:

The March 2019 mosque shootings in Christchurch, New Zealand and the 2019 Easter bombings in Sri Lanka demonstrate that active groups, influenced by either form of extremism, aim to inflict mass casualties and create and exacerbate divisions within countries

After IS lost territory in Iraq and Syria in 2017, it shifted focus to other countries with fragile security environments, particularly Afghanistan, Nigeria, and the Philippines

Instability in nearly every region

Islamic State-linked attacks in NorthAmerica, Europe and Australia

IS and its supporters mounted at least twice as many attacks in these three countries in 2018 compared to the year before

2017

2018

Afghanistan

Nigeria

Philippines

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Aon’s 2019 Risk Maps

Aon’s 2019 Risk Maps are an in-depth annual survey of the world’s political risk, terrorism and political violence, helping organizations identify the major macro-economic and political developments that could affect their business in the coming year.

Managing Through Geopolitical Uncertainty

Geopolitical uncertainty carries many implications for companies that rely on international trade. From supply chain disruption to location strategy, Aon’s The One Brief features perspectives on how business leaders can manage through the unknown.

Explore Aon's The One Brief

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AON plc (NYSE:AON) is a leading global professional services firm providing a broad range of risk, retirement and health solutions. Our 50,000 colleagues in 120 countries empower results for clients by using proprietary data and analytics to deliver insights that reduce volatility and improve performance.

The Risk Advisory Group provides intelligence, investigations, screening and security management to support organisations dealing with complex international threats. Our guidance, intelligence and analysis help many of the world’s foremost businesses negotiate challenging and uncertain environments to choose the right opportunities, in the right markets, with the right partners.

Continuum Economics is the international market-leading service for independent economic research powered by 4Cast and Roubini Global Economics. With its growing user base of 10,000 clients and a reputation for incisive analysis on every aspect of the market, it provides research that spans short-term market signals and long-term strategic themes.

The Rise of Populism in Europe

The rise of populism has encouraged divisive politics and provided fuel for extreme ideologies. Eleven countries in Europe now have populist parties in government, while populist parties hold on average 22% share of the vote across 33 European countries. Populism has increased the prospect of politically motivated measures to frustrate established contracts, while forcing firms hit by new tariffs and trade barriers to reconsider their international supply chains.

Populist Parties in Europe (%,Votes)

2012-2014

Sweden

2017-2018

Source: Contiuum Economics. Note: *Spanish elections were in 2011 and 2016

Evolving Terrorism in Europe and North America

Terrorism motivated by right-wing beliefs in Europe and national extremism in North America has doubled since 2016, with groups targeting ethnic, religious and LGBT+ minorities. The U.S. and Germany had the highest numbers of attacks and foiled plots in 2018.

Far-right Terrorist Attacks & Plots

Belgium

France

Germany

Greece

Italy

Spain

Sweden

U.K.

U.S.

Source: Risk Advisory Group

2016

2017

2018

2012-2014

Germany

2017-2018

2012-2014

Netherlands

2017-2018

2012-2014

France

2017-2018

2012-2014

Italy

2017-2018

2012-2014

Spain*

2017-2018

2012-2014

Sweden

2017-2018

2012-2014

Sweden

2017-2018

2012-2014

Sweden

2017-2018

2012-2014

Sweden

2017-2018

2012-2014

Sweden

2017-2018

Globalization opens up markets – but with opportunity comes risk. Trade uncertainty, combined with changes in the terrorist threat, mean organizations face a large number of economic and political challenges. From keeping people safe to threats to overall business continuity, how are organizations navigating the volatility?

Terrorism in 2019: What do changing tactics and ideologies mean for business?

As motives and methods evolve ensuring safety measures are in place to mitigate and respond to terrorist incidents and acts of violence will be an increasingly priority to keeping people safe and limiting overall business interruption.

Populism raises the prospect of politically-motivated moves that can end contracts, stall high-profile projects, and force firms to reconsider their overall supply chain.

How does populism impact the global business landscape?

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Source: Continuum Economics

Share the insights:

Experts from Risk Advisory, Continuum Economics, and Aon, discuss the business implications of political risk, terrorism, and political violence.

How Can Organizations Prepare?

Experts from Risk Advisory, Continuum Economics, and Aon, discuss the business implications of political risk, terrorism, and political violence.

2020 Risk Maps

Now Available:

Aon's guide to Political Risk, Terrorism & Political Violence.

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2019 Risk Maps

Now Available:

Aon's guide to Political Risk, Terrorism & Political Violence.

Access the 2019 Risk Maps