Country risk Sep 2001: Analysts see little sign of sovereign risk contagion
Amid mounting concerns about a global economic slowdown, it is still country-specific political and economic factors that are propelling nations up and down the country risk rankings. There have been marked drops for such countries as Argentina, Zimbabwe, and Indonesia but no sign of fears of contagion spreading to their neighbours.
The September report on country risk shows Euromoney's analysts reacting to the global slowdown by carefully choosing among the countries expected to suffer and those that should protect themselves against the downturn. Their choices show that though economic prospects are closely associated with overall risk, there are also several significant exceptions to this pattern. And in their selective identification of gainers and losers, they have indicated scant concern with fears of contagion, except, perhaps in the case of Argentina and Brazil. Most countries can be seen to gain or lose in the risk table on the basis of their own situation, rather than on the basis of the presumed spread of troubles across international borders.
Only someone who is fervently dedicated to avoiding the news can be surprised at the most prominent countries that have lost favour with Euromoney's analysts. There is scarcely a question as to the reasons for the downgrading of Zimbabwe (which fell by 23 places from the March ranking), Argentina (which fell by 11), Indonesia (which fell by 9), Algeria (which fell by 7), and Turkey (which fell by 6).