☛ Want the latest procurement and supply chain news delivered straight to your inbox? Sign up for the Supply Management Daily
August 2011 | Adam Leach
potential impact of natural disasters in the emerging economies of India and
China is intensified by a lack of preparedness, a report says.
The Natural Hazard Risk
published by Maplecroft, says that
while the US and Japan face the highest economic exposure to natural hazards,
businesses in emerging economies are more at risk because these nations lack
the capacity to cope with the effects of a major disaster.
report’s ‘Socio-economic Resilience Index’ ranked countries in terms of the
degree of risk created by their preparedness to deal with such events. The
level of risk was calculated by assessing a number of factors, including
economic robustness, strength of governance, how well infrastructures were established,
disaster preparedness and building regulations. While the US and Japan were
low-risk, China and India got a high-risk rating.
Warhurst, CEO of Maplecroft, said: “The emerging economies, although buoyant
with growth, lack the socio-economic resilience to limit their disaster risk.
This could threaten their economic growth and the extent to which businesses
with operations there hope to flourish. As the purchasing power [of these
nations] grows, so too will the absolute economic value exposed to natural
the growing pressure on businesses to understand the risks associated with
natural disasters, the report cites the fact that the BRIC group of economies –
Brazil, Russia, India and China – is expected to increase its share of economic
output from a quarter to a third by 2020.
June, procurement professionals discussed how supply chain risks caused by
natural disasters could be overcome. During
the CPO Agenda Question Time debate
in London, Nick Wildgoose of Zurich FinancialServices urged
purchasers to check whether any of their supply operations were located in
earthquake or flood zones by asking insurers.