Country risk ratchets up worldwide

Jeremy Weltman
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Country risk increased across the G10 and some of the other main regions of the world in Q3 2012, according to the survey. North America, the eurozone, and Central and Eastern Europe are among those areas where risk perceptions have increased the most.

Risk profiles have stabilized, or even improved slightly, for other parts of the world. However, higher average ECR scores for Asia and the Middle East only partially reverse the falls witnessed previously. They also tend to mask important underlying developments, not least the continual questioning of China’s investor attractions by ECR’s experts, and increased risks for Japan, which has seen both countries slide further down ECR’s rankings.

In total, 110 of the 186 countries in the survey became riskier during the third quarter of the year, while 72 became safer.

In the latest survey results, participating economists and country risk analysts registered further deterioration in perceptions of sovereign risk across five mutually exclusive economic/geographical regions of the world during the third quarter: North America, the European Union (encompassing the eurozone), Central and Eastern Europe and the Commonwealth of Independent States (Russia and the former Soviet satellites). Increased risk within the G10 has been driven by downgraded scores for North America, the eurozone and Japan.