Is your business analysing current global events? If not, then it’s time to adopt a dynamic understanding of geopolitical developments and assess the impact on your business operations. Preparing your company to evaluate the opportunities and dangers of doing business abroad is key to business leadership. Do you have an action plan?

These are 4 of the biggest crises facing business in 2020.

1. Instability in the Gulf

Recent attacks on oil tankers have caused global volatility in international markets. Oil tankers, believed to have been attacked by Iran, disrupted shipping in the Gulf of Hormuz in June 2019. This summer also saw six oil tankers from Saudi Arabia and the UAE “sabotaged with mines”. In September 2019, a drone attack on the Saudi oil plant ARAMCO shut off 5% of global oil supplies, which triggered a surge in prices. Bloomberg named this attack the biggest single oil disruption in history.

2. US-China trade war

The world’s most important bilateral relationship is in jeopardy due to the imposition of severe trading restrictions this year. This has been a huge obstacle for businesses operating in both countries. EurAsia Group reports that “tariffs are already forcing US firms to shift production of their supply chains out of China”. As a result, Mexico and Canada are now the US’s biggest trading partners.

3. Terror and tourism

Terrorist attacks in tourist destinations result in industry-wide financial losses. On average, it takes 13 months to recover from a terrorist attack, and damages and rebuilding costs can run into millions of dollars. Following 9/11, “it took New York hotels 34 months to recover”, according to one estimate. The World Economic Forum reported that Brussels spent $57.9 million per day to “keep the city on lockdown following the Paris attacks”. Tourists are unlikely to travel to destinations where their safety and security is threatened.

4. Cyber attacks

The 2017 NotPetya attack caused $10 billion in damages, and an increasingly connected world means anyone can be a target. In 2016, a Russian hacker group almost ran French TV channel TV5Monde into the ground using malicious software to disable its computer systems. The attack cost the network 5 million euros in the first year due to complete loss of internet access, and 3 million euros every subsequent year to install heightened security measures. The attack followed a deterioration in France’s relationship with Russian relationship over the Ukraine crisis. 

Is your business crisis-ready?

Join us from 23-24 November 2020 for executive course “Geopolitical Analytical Skills for Business Leaders”, led by Dr Jean Marc Rickli, Head of Global Risk and Resilience at the GCSP.

Disclaimer: The views, information and opinions expressed in the written publications are the authors’ own and do not necessarily reflect those shared by the Geneva Centre for Security Policy or its employees. The GCSP is not responsible for and may not always verify the accuracy of the information contained in the written publications submitted by a writer.