Of the world's six regions, the Asia-Pacific ranked second to the Middle East and North Africa as most risky in the organisation's Global Terrorism Index 2003-2004. It was given a rating of 45.16 against a global average of 40.19.

Colombia, the violent South American nation known as a drug-producing and trafficking hub topped the study, which placed Israel second, the United States fourth, Iraq sixth and Britain 10th.

But developing Asian countries filled the remaining positions, with Pakistan placed third internationally and the Philippines, at fifth, considered Southeast Asia's most likely terrorism hot-spot. Filling the remaining slots were Afghanistan, Indonesia and India, with Sri Lanka equal with Britain.

Nepal was also considered a high terrorism risk, while Singapore, Malaysia, Thailand, Australia and East Timor were rated medium-to-high. China, at 52nd overall, joined Japan, Bangladesh and Brunei in being assessed at medium risk.

North Korea, although on the US' 'axis of evil' list and destabilising northeast Asia with nuclear weapons and ballistic missiles, was considered the world's least likely country to attract terrorism.

The director of the World Markets Research Centre's political and economic forecasting unit, Guy Dunn, said repressive state controls imposed by North Korean dictator Kim Jong-il's regime made the threat of a terrorist attack almost non-existent.

Ironically, terrorism tended to flourish in fully fledged or transitional democracies.

'This will raise a few eyebrows in Seoul, but what we're trying to ask is what is the reality of a terrorist attack in North Korea? - and the answer is that it's almost non-existent,' Mr Dunn said. 'The state controls are so repressive, there is no active terrorist group and therefore no real threat.'

The report considered the risk of terrorism in Hong Kong was insignificant, despite the presence of a large expatriate community and foreign companies.

Mr Dunn believed every country was at threat of terrorism and it could be concluded that all Caribbean nations were also at risk of a Bali-style attack because so many American tourists frequented them.

'But that's almost scare-mongering because we're trying to assess the reality of the risks,' he said. 'Hong Kong is a soft target compared to mainland China, but the threat has to be kept in perspective. There's no reason why Hong Kong should be singled out over and above some of the other areas in Southeast Asia.'

China was relatively safe from terrorism, although Muslim separatists from Xinjiang province did carry out attacks in the northwest.

The Philippines and Indonesia, the targets in recent years of a series of bombing attacks against civilians blamed on Islamic extremists, were determined the region's riskiest countries.

The report deemed many parts of the Philippines risky for investors. 'The mix of techniques, including bombing and kidnapping, as well as the alleged links between some of the groups and the al-Qaeda terrorism network, create a high terrorist risk,' the report found.

Indonesia's terrorism threat was evident from last October's Bali bombings and numerous smaller attacks. Threats would continue despite breakthroughs in unearthing evidence and arrests of key militants.

Pakistan and Afghanistan were considered dangerous because of the activities of Osama bin Laden's al-Qaeda network.

No attack had taken place on Australian soil, but it had acquired a medium-to-high rating because of its high profile in the war on terrorism and the resulting resentment among extremist groups.

Mr Dunn said such reasoning was behind the high rankings in the index of the US and Britain.

'There's been an attack on US soil, but to go through a rigorous methodology and come out with it in fourth place is sobering,' he said.

There had been no attack on British soil from the same source, but the nation, like Australia, remained a prize target because the nature of terrorism had changed.

'What's changed is that with al-Qaeda being a transnational or international threat, all countries are now at risk,' he said. 'Terrorism has moved from becoming almost a peripheral threat to business to one of the major risks that companies face.'

The World Markets Research Centre is an intelligence research consultancy whose clients include the Organisation of the Petroleum Exporting Countries, Shell and Microsoft.