Delta variant raises global exposure to ‘political risk’ and economic slowdown, report finds
- While whole world is being affected by a sharp increase in social pressures, Coface assessment particularly flags impact of unemployment in Europe and United States
- Deteriorating living standards and purchasing power amid coronavirus, as well as a rise in inequalities, are cited as reasons behind worsening global social risk index
The Delta variant of the coronavirus, when factored together with a number of persistent economic issues being seen throughout the world, could lead to both political risks and greater social pressures, a new assessment has found.
Fresh lockdowns, enduring unemployment in a number of countries, and higher commodity prices resulting from fiscal stimulus measures are also working in tandem to weaken purchasing power and living standards, according to a second-quarter economic report card issued by trade credit insurer Coface.
Additionally, Coface’s global social risk index for all of 2020 rose to its highest level since 2010. Despite fiscal and monetary support globally, 140 out of the 160 assessed countries saw their gross domestic product (GDP) decline last year, and 145 countries saw their unemployment rate increase.
“The annual update of the Coface index shows a sharp rise in political risk around the world,” it said.
Since the Arab spring incidents that began in 2010, Coface had been studying the emergence of popular movements by linking the pressures for change with the instruments that facilitate popular mobilisation.