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Politics, conflict undermine supply chains

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Ukraine and Thailand pose substantial supply chain exposures, while Taiwan has improved its supply chain resiliency, according to FM Global's 2015 Global Resilience Index, released Tuesday.

The index evaluates three primary factors — economic, risk quality and the supply chain itself — to arrive at its rankings, FM Global said in a statement.

Ukraine saw the largest year-over-year drop in this year's ranking, falling 31 places to 107th due to the nation's conflict with Russia.

“This worsening political risk and a weakened infrastructure are the main negative factors affecting the rank of Europe's largest country” by area, FM Global said in the statement.

Thailand fell 20 places to 82nd due to “poorer perceptions of the country's infrastructure … and the quality of local suppliers as well as a decline in political stability and the quality of fire risk management,” FM Global said.

By contrast, Taiwan climbed 52 places to 37th position on a substantial improvement to its commitment to risk management, both natural hazard and fire, FM Global said.

“This rise shows an increased awareness of the natural hazards and fire risk exposures inherent to the country, the building of new facilities to a higher level of quality and greater acceptance of risk management measures that can better existing protect facilities,” said Bret Ahnell, executive vice president at FM Global.

The U.S is divided into three regions due to its geographical spread presenting different risk exposures. Region 3 includes most of the central part of the country and ranks 10th; Region 1, with much of the East Coast, ranks 16th; and Region 2, primarily the West Coast, ranks 21st, according to FM Global.

The most resilient nations are Norway at No. 1, Switzerland, and the Netherlands, while the least resilient are Mauritania, Kyrgyz Republic and — ranking last at 130 — Venezuela.

The index is compiled annually for FM Global, by Oxford, England-based analytics and advisory firm Oxford Metrica.