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 22, 2014 -- Updated 1231 GMT (2031 HKT)
James Dawes: Evil is the strongest word we have to prepare ourselves to kill others.
August 23, 2014 -- Updated 0159 GMT (0959 HKT)
As protests over the shooting of an unarmed black teen calmed down, the question remains: Where's the police officer who pulled the trigger?
August 22, 2014 -- Updated 0922 GMT (1722 HKT)
CNN's Tim Lister: Getting rid of ISIS will be tougher than taking on al Qaeda.
August 22, 2014 -- Updated 0042 GMT (0842 HKT)
American patients infected with Ebola are being released from the hospital. What now?
August 22, 2014 -- Updated 1048 GMT (1848 HKT)
One of the first observers at the MH17 crash site in Ukraine describes the harrowing scene.
August 21, 2014 -- Updated 1353 GMT (2153 HKT)
Five survivors of acid attacks capture India's attention with a "ground breaking" photo shoot.
August 20, 2014 -- Updated 1219 GMT (2019 HKT)
In an exclusive CNN interview, Lance Armstrong admits to having a "f**k you" attitude.
August 20, 2014 -- Updated 0036 GMT (0836 HKT)
The pain that Michael Brown's parents are going through is something Sybrina Fulton can relate to. She, too, lost a son in a controversial shooting.
August 22, 2014 -- Updated 1149 GMT (1949 HKT)
Cristiano Ronaldo of Real Madrid gestures during the UEFA Super Cup match between Real Madrid and Sevilla at Cardiff City Stadium on August 12, 2014 Cardiff, Wales.
"We are like one grain of sand against a whole beach," says Eibar fan Unai Eraso.
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.
August 22, 2014 -- Updated 1022 GMT (1822 HKT)
From fierce protests in Ferguson, to an Ebola survivor discharged from a hospital in Atlanta, browse through the photos of the week.
ADVERTISEMENT