Risks to firms ‘at highest in decade’

December 14, 2015 8:15 am Published by

Risk to businesses at ‘highest level in past decade’

  • 14 December 2015
  • From the section Business

Mechanical equipment in a Chinese portImage copyright
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China’s economic slowdown is forecast to continue in 2016

Companies face the highest level of risk in a decade because of factors including terror attacks and China’s economic slowdown, a report has said.

Consultants at Control Risks issued the warning in their 2016 Risk Map.

Chief executive Richard Fenning told the BBC the global risk outlook was currently an “eight out of 10”.

Threats include the strengthening of the so-called Islamic State (IS) and uncertainty over China’s ability to adapt to slower growth.

Chinese authorities face difficult questions over how to handle a slowdown in annual growth to 6%, according to the report.

But Mr Fenning said he did not think the country would suffer a “hard landing” as it continues to shift from a manufacturing-led to a consumer-led economy.

He told the BBC’s Today programme: “I think President Xi and the senior echelons of the Chinese leadership are the most competent group of people to be running that country, probably ever.

“I think they will get them and us through it but there will be bumps in the road.”

‘Better shape’

Other risks include a possible exit by Britain from the EU, known as a “Brexit”, and political tensions in the Middle East, Mr Fenning said.

However, he said businesses faced lower risks than at the start of the Risk Map 40 years ago when there was an oil crisis, higher tensions in the Middle East and a “very frosty” Cold War.

“Compared to then we are in much better shape. We are healthier, we’re wealthier and most of us are safer,” he said.

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This post was written by FSB News