May 17, 2020

Asian economies most vulnerable to natural hazards

natural hazards
natural disasters
bangladesh
India
Freddie Pierce
3 min
Japan is less at risk due to it's economic resilience
Follow @WDMEllaCopeland A number of Asias most important growth economies are at the highest risk from Natural Hazards, according to the second Natural...

A number of Asia’s most important growth economies are at the highest risk from Natural Hazards, according to the second Natural Hazards Risk Atlas released by industry research group Maplecroft.

Countries are rated by Maplecroft in accordance to the level of exposure to their cities and trading hubs in the event of natural disasters such as flooding, earthquakes and tropical cyclones. The study highlighted the economies of Bangladesh, the Philippines, Myanmar, India and Vietnam in the top ten countries with the greatest proportion of their economic output exposed to natural hazards.

In addition, these countries were also judged to demonstrate ‘poor capability to recover’ from any significant event exposing investments to risk of supply chain and market disruptions. This could lead to business interruption costs and material damage to essential infrastructure.

Knock on effects

Maplecroft’s study determined that these knock on effects of a natural disaster could also exacerbate other risks like societal unrest, food security, corruption and rule of law, potentially leading to increased political risk.

“High exposure to natural hazards in these countries are compounded by a lack of resilience to combat the effects of a disaster should one emerge,” explained Maplecroft’s Head of Maps and Indices Helen Hodge. “Given the exposure of financial and manufacturing centres, the occurrence of a major event would be very likely to have significant impacts on the total economic output 

of these countries, as well as foreign business.”

The top countries at risk:

  1. Bangladesh
  2. The Philippines
  3. The Dominican Republic
  4. Myanmar
  5. India
  6. Vietnam
  7. Honduras
  8. Laos
  9. Haiti

 

SEE RELATED STORIES FROM THE WDM CONTENT NETWORK:

‘Weak resilience’

High levels of economic exposure, coupled with weak resilience, means that the fallout of a large natural disaster would likely be felt keenest in the top ten countries at risk. Impacts in these exposed Asian countries are also heightened by their economic fragility. Some of the highest risk countries have substantial economic outputs, but they are fuelled by large, poor populations,

Countries with strong resilience

Japan, China, Taiwan and Mexico are calculated to have the highest economic exposure to natural hazards in absolute terms. However, huge economies like Japan have the capacity to recover quickly from natural disasters due to entrenched resilience factors such as economic strength, strong governance, disaster preparedness and established infrastructure – things that are largely ineffective in the emerging growth economies.

Maplecroft CEO Alyson Warhurst stated “this presents an exciting opportunity for business to contribute to reducing risk and thus to enhance their own security in the future economic growth environment. As the middle classes grow in these emerging economies the appetite for insurance will also grow, incentivising stronger disaster preparedness.”

About

The Natural Hazards Risk Atlas helps companies to assess the risk across 197 countries. Based on research undertaken by Maplecroft and UN OCHA, it includes 29 risk indicies and interactive maps that measure physical exposure to 12 different natural hazards and provides a calculation of overall economic exposure and socio-economic consequences.

All information and pictures are copyrighted to Maplecroft.

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Jun 19, 2021

Driver shortages: Why the industry needs to be worried

Logistics
SCALA
supplychain
Brexit
Rob Wright, Executive Director...
4 min
Logistics professionals need urgent solutions to a shortage in drivers caused by a perfect storm of Brexit, COVID-19 and compounding economic factors

While driver shortages are a global problem, with a recent survey from the International Road Transport Union suggesting that driver shortages are expected to increase by 25% year-on-year across its 23 member countries, the issue has very much made itself felt for UK businesses in recent weeks. 

A perfect storm of factors, which many within the industry have been wary of, and warning about, for months, have led to a situation wherein businesses are suddenly facing significant difficulties around transporting goods to shelves on time, as well as inflated operating costs for doing so. 

What’s more, the public may also see price rises as a result due to demand outmatching supply for certain product lines, which in turn brings with it the risk of customer dissatisfaction and a hit to brand and stakeholder reputation. Given that this price inflation has been speculated to hit in October, when the extended grace period on Brexit customs checks comes to an end, the worst may be yet to come.

"Steps must be taken to make a career in the industry a more attractive proposition for younger drivers, which will require a joint effort from government, industry bodies, and the sector as a whole"


That said, we have already been hearing reports of service interruption due to lack of driver availability, meaning that volumes aren’t being transported, or delivered, to required schedules and lead times. A real-world example of this occurred on the weekend of 4-6 June with convenience retailer Nisa, with deliveries to Nisa outlets across the UK affected by driver shortages to its logistics provider DHL.

But where has this skills shortage stemmed from? 

Supply is the primary issue. Specifically, the number of available EU drivers has decreased by up to 15,000 drivers due to Brexit alone, and this has been further exacerbated by drivers returning to their home country during the COVID-19 pandemic, as well as changes to foreign exchange rates making UK a less desirable place to live and work. This, alongside the recent need to manage IR35 tax changes, has also led to significant inflation in driver and transport costs.

COVID-19 complications have also meant that there have been no HGV driver tests over the past year, meaning the expected 6,000-7,000 new drivers over the past year have not appeared. With the return of the hospitality sector we understand that this is a significant challenge with, for instance, order delivery lead times being extended.

It is little surprise, therefore, that the Road Haulage Association (RHA) earlier this month became the latest in a long line of industry spokespeople to write to the government about the driver shortage for trucks. The letter echoed the view held by much of the industry, that the cause of this issue is both multi-faceted and, at least in some aspects, long-standing. 

So, many in the industry are in agreement as to the driving factors behind this crisis. But what can be done? 

Simply enough, outside of businesses completely reorganising their supply chain network, external support is needed. In the short-term, the government should consider providing the industry with financial aid, and this can also be supported more widely with legislative change. 

Specifically, immigration policy could be updated to place drivers on the shortage occupations list, which would go some way towards easing the burden created by foreign drivers returning to their home countries. Looking elsewhere, government should also look for ways to increase the availability of HGV driver tests after the blockage created by the coronavirus lockdowns.

Looking more long-term, steps must be taken to make a career in the industry a more attractive proposition for younger drivers, which will require a joint effort from government, industry bodies, and the sector as a whole. As it stands, multiple sources suggest that the average age of truck drivers in the UK is 48, with only one in every hundred drivers under the age of 25. We must therefore do more to increase the talent pipeline coming into the industry if we are to offset more significant skills shortages further down the line. 

On the back of a turbulent year for the supply chain industry, it has become increasingly clear that the long-foretold shortage of drivers is now having a tangible and, in places, crippling effect on supply chains. 

Drivers, and the wider supply chain industry, have rightly been recognised for the seismic role they played in keeping the nation moving and fed over the past year under unprecedented strain. If this level of service is to continue, we must now see Government answer calls to provide the support the sector needs, and work hand-in-hand with the industry to find a solution. If we do not see concrete action to this effect soon, we are likely to be in for a turbulent few months. 
 

Rob Wright is executive director at SCALA, a leading provider of management services for the supply chain and logistics sector

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