Skip to main content

Report: Political instability on the rise

By Sophie Brown, CNN
December 12, 2013 -- Updated 0446 GMT (1246 HKT)
People walk with their belongings in the area around Sinujiif as they evacuate on November 14, 2013 after a ferocious storm and days of heavy floods in Somalia's northeastern Puntland region. Somalia has ranked in the top 10 in Maplecroft's political risk index for the past six years. People walk with their belongings in the area around Sinujiif as they evacuate on November 14, 2013 after a ferocious storm and days of heavy floods in Somalia's northeastern Puntland region. Somalia has ranked in the top 10 in Maplecroft's political risk index for the past six years.
HIDE CAPTION
The top 10 political risk hotspots: 1. Somalia
2. Syria
3. Afghanistan
4. Sudan
5. Democratic Republic of the Congo
6. Central African Republic
7. Yemen
8. Libya
9. South Sudan
10. Iraq
<<
<
1
2
3
4
5
6
7
8
9
10
>
>>
STORY HIGHLIGHTS
  • New research finds the Middle East and North Africa, and East Africa are political risk hotspots
  • The Philippines, India, Uganda, Ghana, Israel and Malaysia saw the largest decrease in risk
  • More than half of countries are classified as 'extreme' or 'high risk' of limiting political freedoms
  • Disparity between political freedom and education drives short-term social unrest

Hong Kong (CNN) -- Growing levels of conflict, terrorism, and the toppling of regimes in the Middle East and North Africa, as well as political violence in East Africa, are driving a rise in political instability worldwide, according to research by UK risk analysis firm, Maplecroft released on Thursday.

Since 2010, one in ten of the countries surveyed have experienced a significant increase in the level of short-term political risk.

These risks include governments asserting control over natural resources, regimes being ousted by popular uprisings and the expropriation of foreign investors' assets.

The findings form part of the latest Maplecroft Political Risk Atlas, which uses 52 indicators to help companies monitor political issues affecting the business environment in 197 countries.

Security at the Kenya/Somalia border
CNN on the ground in CAR
Doctors speak against atrocities in Syria
'Taliban is in a position to come back'

Since 2010, Syria has deteriorated the most. It now ranks second compared with a 44th place ranking in 2010. Somalia topped the rankings.

Afghanistan, Sudan and the Democratic Republic of the Congo also ranked in the top five.

Egypt has been downgraded to "extreme risk" for the first time as a result of violence following the ousting of former President Mohamed Morsy and an increase in terrorist attacks in the Sinai Peninsula, the report said.

Maplecroft warned that Syria, Egypt and Libya are "now so bad" that they will be "mired in exceptionally high levels of dynamic political risk for years to come."

A fall in political violence in the Philippines, India and Uganda has contributed to these countries experiencing the biggest reduction in short-term political risk over the past four years.

Improvements in the level of governance has also helped to lower risk levels in Malaysia and Israel in the same period.

Social unrest

The report said there is a higher chance for social unrest to exacerbate political instability in Bangladesh, Belarus, China, Kazakhstan, Saudi Arabia and Vietnam.

"This is due to the erosion of democratic freedoms, increasing crackdowns on political position and the brutality by security forces towards protesters, compounded by rising food prices and worsening working conditions," Maplecroft said in a statement.

Another concern for foreign investors is that there has been a major increase in oppression by governments worldwide.

"This erosion of political freedoms is central to driving the wider risk of unrest and instability in the medium- to long term," said Charlotte Ingham, senior political risk analyst at Maplecroft.

In the short term, foreign investors face a heightened risk of becoming complicit with the actions of these oppressive regimes, which poses a threat to a company's reputation, the think tank said.

Empowered youth

Instability increases as the gap grows between political freedoms and social gains, such as education and computer literacy among young people.

In 2010, prior to the the Arab Spring, Libya, Tunisia, Iran, Syria and Egypt were among the countries with the biggest divide between political freedoms and social gains.

Maplecroft predicts that the growing imbalance between social gains and political freedoms in Bahrain, Azerbaijan and South Africa will heighten the risk of instability in those countries in 2014 and beyond.

Although China is categorized as "extreme risk" in Maplecroft's ranking of oppressive regimes, the speed of the country's governance reforms is likely to be sufficient to limit the chances of widespread social unrest that could lead to a "jasmine" revolution, according to the think tank.

But China's increased scrutiny of foreign business practices has created compliance challenges for companies operating there, the report added.

Maplecroft cautioned that Vietnam's crackdown on social media and freedom of speech amid growing opposition may undermine the stability of the government in the long term.

Poland has experienced a significant increase in the level of political freedoms over the past four years, according to Maplecroft, and now displays a "near perfect balance" between the level of political freedoms and social gains, which reduces the likelihood of protests and disputes over labor conditions.

Political violence

East African countries saw the biggest increase in the risk of political violence, including terrorism, poor governance, and regimes vulnerable to popular uprisings. Somalia, Sudan and South Sudan scored in the "extreme risk" category, while Kenya and Ethiopia are "high risk." Eritrea, Tanzania and Mozambique also saw a change in their risk category.

Three years after the Arab Spring, more than 60% of countries in the Middle East and North Africa region have seen a significant rise in political violence, demonstrating the long-term political risks associated with forced regime change, the report said.

In the West, the impact of the global financial crisis continues to be seen in high levels of unemployment and underemployment.

This, combined with austerity measures, has contributed to growing inequality and stalling or declining living standards, according to Maplecroft.

Political landscapes both in Europe and the United States have become increasingly fragmented and polarized as populist parties flourished in response to growing voter dissatisfaction with established political parties over these issues.

ADVERTISEMENT
Part of complete coverage on
August 27, 2014 -- Updated 0023 GMT (0823 HKT)
Wilson Raj Perumal tells CNN how he rigged World Cup games: "I was giving orders to the coach."
August 29, 2014 -- Updated 0823 GMT (1623 HKT)
He should be toddling around a playground. Instead, his tiny hands grip an AK-47.
August 29, 2014 -- Updated 1652 GMT (0052 HKT)
CNN's Will Ripley travels to North Korea, visiting an international wrestling festival and a slide-filled water park.
August 28, 2014 -- Updated 0920 GMT (1720 HKT)
Our whole solar system appears to be inside a searing gas bubble, scientists say.
August 28, 2014 -- Updated 1230 GMT (2030 HKT)
In a raid on a luxury apartment complex, agents caught up with a French-Algerian man they accuse of bringing back terror to Europe.
August 28, 2014 -- Updated 0002 GMT (0802 HKT)
One journalist murdered, another still being held by ISIS -- a ransom negotiator talks to CNN about trying to get a hostage home alive.
August 27, 2014 -- Updated 1228 GMT (2028 HKT)
Was a police officer justified in shooting and killing Michael Brown?
August 28, 2014 -- Updated 1654 GMT (0054 HKT)
Don't like the country you live in? Meet the people who created their own "micronations."
August 29, 2014 -- Updated 1835 GMT (0235 HKT)
South Africa Music Legends stamps
Artist Hendrik Gericke puts a spotlight on iconic performers from South Africa in these incredible monochrome illustrations.
August 26, 2014 -- Updated 0946 GMT (1746 HKT)
We asked you what you would like to know about Ebola. Experts answer some of your most common questions and concerns.
CNN joins the fight to end modern-day slavery by shining a spotlight on its horrors and highlighting success stories.
Browse through images from CNN teams around the world that you don't always see on news reports.
ADVERTISEMENT