Download Country Risk Updates – Q1 2016 Jan

Country Risk Updates – Q1 2016
Jan-Mar 2016
Risk Rating Changes
The risk ratings for Q1 2016 indicate that 5 countries have been upgraded and 8
countries have been
downgraded.
Country
Change
Cote
d’Ivoire
▲
Malawi
▼
Senegal
▲
Zambia
▼
Cambodia
▼
Poland
▼
Costa Rica
▼
Ecuador
▼
Namibia
▲
Romania
▲
Trinidad
and Tobago
▼
Iran
▲
Canada
▼
Extended WW Headline
Dun & Bradstreet upgrades Cote d'Ivoire's
country risk rating as the economy's rapid
growth looks set to continue.
Dun & Bradstreet downgrades Malawi’s country
risk rating due to several serious challenges.
Dun & Bradstreet upgrades Senegal’s country
risk rating owing to deeper regulatory
reforms.
Dun & Bradstreet downgrades Zambia's country
risk rating following a downbeat economic
assessment by the IMF.
Dun & Bradstreet downgrades Cambodia's rating
outlook as political turmoil weakens investor
sentiment.
Dun & Bradstreet downgrades Poland's country
risk rating after worrying developments in the
legal sphere.
Dun & Bradstreet downgrades Costa Rica's
country risk rating amid a widening deficit
and rising debt.
Dun & Bradstreet downgrades Ecuador's country
risk rating following unfavourable
constitutional reforms.
Dun & Bradstreet upgrades Namibia's country
risk rating amid a mining-led acceleration in
growth and greater political stability.
Dun & Bradstreet upgrades Romania’s country
risk rating due to the prospect of greater
political stability in 2016, and potentially
longer should the current anti-corruption
spirit endure.
Dun & Bradstreet downgrades Trinidad and
Tobago's country risk rating as the economy
contracts due to the collapse in hydrocarbon
prices.
Dun & Bradstreet upgrades Iran's country risk
rating by two quartiles following the lifting
of most sanctions by the UN, US and EU.
Dun & Bradstreet downgrades Canada's country risk rating amid
early-2016 economic sluggishness, stemming from the low oil price,
currency weakness and rising import costs.
Outlook Trend Changes
Country
Change
Egypt
▼
Iraq
▲
Papua New
Guinea
▼
Azerbaijan
▼
Hong Kong
▼
Netherlands
▲
Slovenia
▼
Bahrain
▼
Extended WW Headline
Dun & Bradstreet downgrades the rating outlook
as the authorities opt for import controls
over devaluation in response to the chronic
shortage of FX.
Dun & Bradstreet upgrades Iraq's rating
outlook following a strategic victory against
IS and the bottoming out of the oil price
fall.
Dun & Bradstreet downgrades the rating outlook
as negative external factors, including lower
international commodity prices and a slowing
Chinese economy, weaken growth.
Dun & Bradstreet downgrades its rating outlook for Azerbaijan as
the economy falters amid weak oil prices, a sharp drop in the
manat, government cut-backs and rising inflation.
Dun & Bradstreet downgrades its rating outlook for Hong Kong
because of contagion fears from China's capital outflows and
unpredictable policy responses.
Dun & Bradstreet upgrades its rating outlook for the Netherlands
amid strong economic growth that is being driven by rising
investment and domestic demand.
Dun & Bradstreet downgrades its rating outlook for Slovenia as
a deepening migration crisis increases threats to the cross-border
passage of goods.
Debt concerns grow as Fitch revises the ratings outlook to
negative.
World Watch
Country
Angola
Mauritius
Mozambique
Tanzania
Australia
Hong Kong
Myanmar
Papua New
Guinea
Taiwan
Belarus
Estonia
Lithuania
Serbia
Uzbekistan
Israel
Extended WW Headline
Oil revenues are under pressure and causing financial
stress in the country.
Maritime projects are taking shape as the government
pursues its 'Ocean economy' strategy.
The government secures balance of payments support
from the IMF.
The country elects a new president but political
rivalries remain a destabilising factor.
Reports emerge of an increasing Islamic State
presence in Afghanistan.
Retail and property shocks will test economic
resilience in 2016.
Politicians jockey for position after a landslide
election victory for Suu Kyi's NLD party.
Growth forecasts decline owing to drought and the
temporary closure of a mine.
January's elections could lead to more cautious
market sentiment.
Lukashenko wins another term as president, while the
West eases sanctions.
Household consumption drives third-quarter growth,
underpinned by strong job prospects and rising wages.
Paying taxes in Lithuania becomes more cumbersome and
compares poorly to its Baltic peers.
The imminent opening of negotiations on EU membership
should spur the push for reforms.
Government unveils banking reforms for the period
2016 to 2020.
Medium- and long-term economic prospects get a boost
Saudi Arabia
Canada
Dominican
Republic
Honduras
Trinidad &
Tobago
Ireland
Switzerland
United
Kingdom
following a gas exploration deal.
Record levels of oil production are maintained,
triggering a further decline in oil prices.
Growth should pick up in 2016 but the two-speed
economy persists.
The IMF describes the Dominican Republic as amongst
the most dynamic in the region.
A money laundering scandal threatens to undermine
government credibility and stoke political tensions.
The new government is to implement fiscal
consolidation and possible tax hikes.
Lower unemployment, higher real wages and buoyant
exports growth boost domestic demand.
The central bank maintains key policy rates despite
rapidly falling consumer prices.
Insolvency risk is falling amid solid economic
performance.
Risk Rating Explanations
The DB risk indicator is divided into seven bands, ranging from DB1 through DB7.
Each band is subdivided into quartiles (a-d), with an ‘a’ designation representing
slightly less risk than a ‘b’ designation and so on. Only the DB7 indicator is not
divided into quartiles.
Indicat
or
Meaning
Explanation
DB1
Lowest Risk
DB2
Low Risk
DB3
Slight Risk
DB4
Moderate Risk
DB5
High Risk
DB6
Very High
Risk
DB7
Highest Risk
Lowest degree of uncertainty associated
with expected returns, such as export
payments and foreign debt and equity
servicing.
Low degree of uncertainty associated with
expected returns. However, country-wide
factors may result in higher volatility of
returns at a future date.
Enough uncertainty over expected returns to
warrant close monitoring of country risk.
Customers should actively manage their risk
exposures.
Significant uncertainty over expected
returns. Risk-averse
Customers are advised to protect against
potential losses.
Considerable uncertainty associated with
expected returns. Businesses are advised to
limit their exposure and/or select highreturn transactions only.
Expected returns subject to large degree of
volatility. A very high expected return is
required to compensate for the additional
risk or the cost of hedging such risk.
Returns are almost impossible to predict
with any accuracy. Business infrastructure
has, in effect, broken down.
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