LONDON, Control Risks, the consultancy specialized in global risk, affirms that a US policy of containment of China is about to emerge as a pillar of the new world order in 2019.
The forecast is included in the annual RiskMap of Control Risks, a projection of political and security risks for business leaders and policy makers around the world, which was published today.
Richard Fenning, executive director of Control Risks, says: “What began as a commercial war will end up hardening as a more permanent position in 2019. The trade confrontation between the United States and China will become the decisive geopolitical dynamic.”
“This antagonistic relationship will not only complicate life for businesses in China and the US Companies from a broad orbit around this confrontation will feel the political and economic impact,” adds Fenning.
The five main risks for 2019
The evaluation of the United States-China dynamics tops the list of Control Risks of the five main risks for business in 2019. In government data and policy after the medium term, respectively, the dynamics of China and the United States configure the levels highest of the forecast for 2019.
The risks posed to business by extreme weather make climate change make its way onto the list for the first time.
The continuous increase of nationalist policies throughout the world leads to the inclusion of the probability that globalized companies lack more and more nationality among the five main risks.
The US-China trade crack predicts a new global order
The trade confrontation between the United States and China will become the decisive geopolitical dynamic of 2019. This antagonistic relationship will not only complicate life for business in China and the United States. Companies from a large orbit around this confrontation will feel the political and economic impact. What began as a commercial war will end up hardening as a more permanent position in 2019. A US policy of “containment of China” could become one of the pillars of a new world order.
The roller coaster of global data
The confrontation between the three domains of data regulation will present a new level of risk for international business in 2019. For China, the data is something that must be controlled; for the European Union, they have to be protected; and for the United States, they are something to market. It will be necessary to prepare for the challenge of obtaining, storing and transferring data within these three domains and between them against an incongruous backdrop of application and growing threats to cybersecurity.
The American political stalemate
The vice of legislative stalemate will reduce decision-making in Washington and throw the United States into a period of marked political uncertainty. The Democratic resurgence in the Chamber of Deputies will seek to put the President under the legislative lens. The rejection of a Republican Senate and the White House will eliminate all hope of coherence for business. The commercial policy will remain unchanged; the pace of deregulation will slow down. Foreign policy will continue to be confused and ambivalent in a global environment that requires clarity and resolution.
The extreme weather disorders
Some of the worst commercial disturbances of 2019 will not be due to terrorist attacks, but to extreme weather conditions and their consequences. Because of storms, floods, droughts and wildfires, the costs of interruptions in production, distribution, sales and travel will skyrocket in 2019. Probably the record of insurance claims related to last year’s time is exceeded. The extreme weather conditions and everything they entail have never been as important as now as commercial risk.
The multinationals will increasingly lack nationality
When 2019 begins, globalized companies run the risk of increasingly lacking nationality, while, ironically, nationalist policies continue to advance throughout the world. The formal and informal barriers are increasing. The trade without friction is beginning to have friction; Supply chains start to slow down. If business leaders do not recalibrate and adapt to this new reality, global actors will end up being interpreted by a world in uncertain transition.
The new reality and the new resilience
The RiskMap 2019 explains a world that is in full transition towards a new world order. To survive, businesses will have to develop a new kind of resilience.
“In 2019 international business will regret the postwar liberal consensus, because it was clearly good …