INTERNATIONAL COUNTRY RISK GUIDE

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INTERNATIONAL COUNTRY RISK GUIDE
INTERNATIONAL
COUNTRY
RISK
GUIDE
Volume XXIV, Number 9
September 2003
Published Monthly by
The PRS Group Inc
6320 Fly Road, Suite 102, P.O.Box 248
East Syracuse, NY 13057-0248, USA
Tel: +1 (315) 431 0511. Fax: +1 (315) 431 0200
http://www.prsgroup.com
International Country Risk Guide
2
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September 2003
International Country Risk Guide
September 2003
- IN THIS ISSUE Editor:
Tom Sealy
THE AMERICAS ......................................................... 7
Regional Editors:
Jeremy P Sealy
Benedict F McTernan
David Thompson
Michael P Nunn
Risk Ratings:
Current Assessments and Forecasts................................ 8
Regional Survey:
Brazil .............................................................................. 9
Costa Rica..................................................................... 13
Cuba.............................................................................. 16
Haiti .............................................................................. 21
Honduras....................................................................... 26
Panama.......................................................................... 29
United States of America.............................................. 34
Uruguay ........................................................................ 40
Statistics:
Penelope J Appleby
Production Manager:
Patricia Redhead
General Information:
Nora Ruthig
Fax: (315) 431-0200
Editorial Inquiries:
Email: [email protected]
Fax: +44 (0) 870 137 0960
EUROPE (EUROPEAN UNION) ............................. 43
©2002, The PRS Group, Inc
International Country Risk Guide
ISSN: 0278-6680
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Risk Ratings:
Current Assessments and Forecasts.............................. 44
Regional Survey:
Belgium ........................................................................ 45
Denmark ....................................................................... 53
Finland .......................................................................... 58
Italy............................................................................... 64
Portugal......................................................................... 72
Spain ............................................................................. 76
EUROPE (NON EUROPEAN UNION) ................... 81
Risk Ratings:
Current Assessments and Forecasts.............................. 82
Regional Survey:
Hungary ........................................................................ 83
Romania........................................................................ 86
Ukraine ......................................................................... 91
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International Country Risk Guide
September 2003
NORTH AFRICA, MIDDLE EAST, AND CENTRAL ASIA................................................. 95
Risk Ratings: Current Assessments and Forecasts .......................................................... 96
Regional Survey:
Armenia ............................................................................................................... 97
Iran ..................................................................................................................... 102
Iraq ..................................................................................................................... 109
Israel .................................................................................................................. 116
Kuwait................................................................................................................ 121
Sudan ................................................................................................................. 125
Tunisia ............................................................................................................... 129
SUB-SAHARAN AFRICA ........................................................................................................ 133
Risk Ratings: Current Assessments and Forecasts ........................................................ 134
Regional Survey:
Botswana............................................................................................................ 135
Congo, Republic ................................................................................................ 140
Ghana................................................................................................................. 142
Liberia................................................................................................................ 147
South Africa....................................................................................................... 154
Zimbabwe .......................................................................................................... 157
ASIA AND THE PACIFIC ....................................................................................................... 163
Risk Ratings: Current Assessments and One-Year Forecasts ....................................... 164
Regional Survey:
India ................................................................................................................... 165
Korea, Republic ................................................................................................. 172
Papua New Guinea............................................................................................. 176
Sri Lanka............................................................................................................ 182
Vietnam.............................................................................................................. 187
INDEX OF COUNTRY REPORTS ......................................................................................... 195
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International Country Risk Guide
September 2003
STATISTICAL SECTION:........................................................................................................S-1
Table 1: Country Risk Ranked by Composite Risk Rating..........................................................S-3
Table 2A: Composite Risk Rating over the period October 2002 - September 2003 ..................S-7
Table 2B: Current Risk Ratings and One-Year Forecasts..........................................................S-10
Table 2C: Composite Risk Rating Forecasts .............................................................................S-13
Table 3A: Political Risk Ratings over the period October 2002 - September 2003...................S-16
Table 3B: Political Risk Points by Component - September 2003 ............................................S-19
Table 3Ba: Political Risk Points by Subcomponent - September 2003 .....................................S-23
Table 3C: Political Risk Rating Forecasts .................................................................................S-26
Table 4A: Financial Risk Ratings over the period October 2002 – September 2003 ................S-29
Table 4B: Financial Risk Points by Component – September 2003 ..........................................S-32
Table 4C: Financial Risk Rating Forecasts................................................................................S-36
Table 5A: Economic Risk Ratings over the period September 2002 - September 2003............S-39
Table 5B: Economic Risk Points by Component - September 2003..........................................S-42
Table 5C: Economic Risk Rating Forecasts...............................................................................S-46
Table 6A: Summary of Economic Risk Components – September 2003 ..................................S-49
Table 6B: Summary of Financial Risk Components - September 2003.....................................S-52
Table 7: GDP per Head of Population........................................................................................S-56
Table 8: Real GDP Growth ........................................................................................................S-59
Table 9: Annual Inflation Rate...................................................................................................S-62
Table 10: Budget Balance as a Percentage of GDP ...................................................................S-65
Table 11: Current Account as a Percentage of GDP ..................................................................S-68
Table 12: Foreign Debt as a Percentage of GDP........................................................................S-71
Table 13: Debt Service as a Percentage of Total Exports ..........................................................S-74
Table 14: Current Account as a Percentage of Total Exports ....................................................S-77
Table 15: International Liquidity as Months of Import Cover ...................................................S-80
Table 16: Exchange Rate Stability .............................................................................................S-83
Table 17: Foreign Exchange Rates.............................................................................................S-86
BRIEF GUIDE TO THE RATINGS SYSTEM ...................................................................... A-1
The Political Risk Rating................................................................................................ A-3
The Economic Risk Rating ............................................................................................. A-9
The Financial Risk Rating ............................................................................................ A-13
The Composite Risk Rating .......................................................................................... A-17
The Forecasting System................................................................................................ A-18
Reproduction without the permission of the publisher is strictly prohibited
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International Country Risk Guide
6
Reproduction without the permission of the publisher is strictly prohibited
September 2003
International Country Risk Guide
September 2003
THE AMERICAS
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7
International Country Risk Guide
September 2003
CURRENT RISK ASESSMENTS AND FORECASTS
COUNTRY
Argentina
Bahamas
Bolivia
Brazil
Canada
Chile
Colombia
Costa Rica
Cuba
Dominican Rep.
Ecuador
El Salvador
Guatemala
Guyana
Haiti
Honduras
Jamaica
Mexico
Nicaragua
Panama
Paraguay
Peru
Suriname
Trinidad & Tobago
United States
Uruguay
Venezuela
CURRENT RATINGS
Political
Financial Economic
Risk
Risk
Risk
09/03
09/03
09/03
64.0
29.5
36.5
84.0
37.5
36.0
63.5
37.0
33.0
69.0
30.5
33.0
89.5
42.0
42.0
77.0
37.5
39.0
55.0
39.5
32.5
74.0
37.0
33.5
58.5
28.5
33.5
62.5
29.5
27.5
58.0
34.5
34.0
64.0
39.5
35.5
60.5
40.0
33.5
68.0
29.5
27.5
45.0
31.5
25.5
60.5
36.0
28.0
70.5
36.0
32.5
69.0
38.0
37.0
57.5
25.0
22.0
72.0
35.0
36.0
57.0
39.0
29.0
62.5
37.5
36.5
65.0
35.5
30.0
67.0
45.0
41.0
81.0
33.0
38.0
70.5
30.5
28.0
50.0
42.5
26.5
Year
Ago
10/02
49.3
76.0
65.8
59.5
84.8
76.3
61.0
74.8
64.3
69.8
59.8
71.5
67.3
62.0
54.0
63.8
68.3
69.8
54.8
71.0
60.3
68.3
62.8
72.5
75.5
61.5
54.3
COMPOSITE RATINGS
Current
Forecasts
Rating
One Year
Five Year
09/03
WC
BC
WC
BC
65.0
58.5
67.5
60.5
77.0
78.8
75.0
79.5
70.5
81.0
66.8
62.5
70.0
63.0
74.5
66.3
51.0
63.0
59.0
76.5
86.8
77.5
84.0
72.0
87.5
76.8
67.5
76.0
68.5
79.5
63.5
57.5
66.5
53.0
69.5
72.3
73.0
77.5
69.0
80.0
60.3
50.5
63.0
45.0
71.0
59.8
56.0
63.5
55.5
69.5
63.3
51.0
61.0
52.0
67.0
69.5
71.5
76.0
67.5
79.0
67.0
65.3
71.5
60.0
75.5
62.5
59.8
66.0
58.5
69.5
51.0
39.5
52.0
38.5
66.5
62.3
57.5
66.0
56.5
72.0
69.5
66.5
73.0
65.0
78.0
72.0
66.0
72.8
60.0
77.0
52.3
44.5
52.0
43.5
60.0
71.5
65.0
74.5
59.0
78.5
62.5
56.3
65.0
42.5
70.5
68.3
59.5
71.3
55.0
72.5
65.3
61.0
67.5
57.5
71.5
76.5
74.0
78.8
71.5
80.5
76.0
73.0
79.5
72.0
84.0
64.5
57.0
67.5
58.0
73.5
59.5
54.5
65.5
51.5
76.0
For historical risk ratings and key economic data on these and other countries in ICRG, please go to
www.CountryData.com.
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International Country Risk Guide
September 2003
BRAZIL
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
60.5
26.5
32.0
59.5
High
Current
09/03
69.0
30.5
33.0
66.3
Mod.
One Year
Ahead
Worst Best
Case
Case
57.0
70.0
20.0
28.0
25.0
28.0
51.0
63.0
High
Mod.
Five Years
Ahead
Worst Best
Case
Case
60.0
73.0
28.0
40.0
30.0
40.0
59.0
76.5
High
Low
POLITICS
Government Stability
Pension Reforms Approved
From the moment he entered office in early 2003, President Luis Inacio “Lula”
da Silva has performed a delicate balancing act in order to maintain the backing
of both his traditional base of support among members of the political left and
the center-right parties upon whose votes the government depends for a
congressional majority. The tension was evident throughout the 2002 election
campaign, as Lula, the firebrand former union leader, preached the gospel of
neo-liberalism, while listeners on the left and right remained hopeful and
skeptical, respectively, both sides of the political spectrum convinced that it was
all a campaign ruse.
Since winning election in a landslide, Lula has taken pains to prove that he is
sincere in embracing the virtues of fiscal restraint and responsible debt
management, to the delight of the domestic and international business
communities and the horror of his Workers’ Party (PT). He made clear that the
leftist social agenda would have to be put on the back burner until the
government carried out structural reforms required to reduce the massive debt
burden, thereby freeing up funds for increased spending on programs designed to
improve conditions for Brazil’s poor and working class population.
Early on, then, the key question ceased to be whether Lula would adhere to the
reform path, but rather how long the PT would continue to stick by its man. That
question was answered - for the moment, anyway - on August 7, when the
Congress gave initial approval to legislation aimed at reforming the country’s
generous pension system.
Under a system enshrined in the 1988 constitution, civil servants are eligible to
retire in their early 50s, with assurances of a lifetime pension equivalent to their
salary at the time of retirement. Pension payments have consumed more than 5%
of GDP annually, creating persistent large budget deficits that threaten to push
the debt burden above $250 billion if the matter is not addressed.
Pension reform topped the legislative agenda of the previous center-right
government, but political considerations deterred former President Fernando
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International Country Risk Guide
September 2003
Henrique Cardoso’s administration from taking action during its eight years in
power. Lula recognized that further delay would merely prolong the economic
instability that is the chief impediment to fulfillment of his long-term social
goals.
The reforms, which were approved by a vote of 358-125, include an increase in
the retirement age, caps on future pensions, sharp cuts in current pension
payments in excess of $800 per month, and a tax on pension income over $400
per month. All told, the changes are expected to save the government $18.6
billion over the next 20 years.
Unfinished Business
In attacking the pension system head on, Lula effectively declared war on the
country’s three million civil servants, a key source of support for the PT. In the
weeks preceding the congressional vote on the reforms, public-sector workers
showed that they were game for battle. Government workers and pensioners
took to the streets, massing in the largest demonstrations Brazil has seen since
the celebrations that followed Lula’s victory in the 2002 presidential election.
With Lula holding firm in the face of an intimidating display of public
opposition, the PT faced a test of faith in their leader. In the end, they chose to
trust Lula’s judgment, as only three of the PT’s legislators voted against the
reforms. The three dissidents were promptly expelled from the party.
However, the fight to overhaul the pension system is far from over. Pension
reform requires a revision of the constitution, and as such involves a more
complicated process than a single vote in the Congress. However, by achieving
victory in the first vote, particularly by such a large margin, Lula has taken a
crucial step, as enraged opponents of the move are well aware.
In the immediate aftermath of the vote, an estimated 50,000 protestors took to
the streets in the capital, Brasilia, resulting in violent confrontations between
rock-wielding demonstrators and police that left several people injured. The
Congress building itself was attacked; its windows broken by government
workers.
Most Brazilians - including the country’s poor - are not terribly sympathetic to
the plight of civil servants, whose income even with the approved cuts is far
higher than that of the many millions who are unemployed or struggling to get by
in low-wage jobs. But the battle over pensions has taken on a symbolic
significance for many who, while not directly affected by the cuts in benefits, are
frustrated at Lula’s apparent abandonment of his social agenda in favor of a
program of neo-liberal reforms.
The early August demonstrations drew protesters from as far away as Rio de
Janeiro, Salvador, and São Paulo. Some carried signs reading “Traitor, Get Out”
and “The Government Is Kneeling Before Capitalism,” while one group carried a
coffin with the president’s name on it.
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International Country Risk Guide
September 2003
Despite signs of growing disillusionment in his traditional constituency, Lula
remains broadly popular. However, the impact of the government’s reforms,
particularly its harsh fiscal austerity program, is beginning to be felt. Economic
activity continues to be choked by high interest rates, and unemployment has
risen above 13%.
Although the central bank has begun lowering interest rates from the crippling
level of 26.5% that held until mid-2003, the danger that a relaxation of monetary
policy may spark damaging inflation cannot be discounted. Consequently,
officials will remain cautious—a posture that in all likelihood means that there is
no significant economic rebound on the horizon. As long as that remains the
case, a popular backlash will remain a persistent threat.
Land Reform Pressures
Beyond its potential effect on government finances, the approval of the pension
reform measure is significant in that it provides conclusive evidence that Lula
has managed to cobble together a rather sizeable majority in the legislature. In
large part, that is attributable to the president’s success in gaining the qualified
support of the center-right Democratic Movement Party (PMDB).
With the PMDB on board, Lula’s administration can claim a three-fifths majority
in both houses of the legislature, which will be indispensable to obtaining
approval of measures that require changes to the constitution. However, the
inclusion of the PMDB in Lula’s camp is all but certain to lead to problems
between the government and the Landless Workers’ Movement (MST).
The MST lent its support to Lula’s 2002 campaign in the expectation that as
president he would rapidly pursue a program of land reform. MST leaders have
demanded that land be provided to 120,000 families in 2003, and to a total of
one million families by the end of Lula’s four-year term.
For its part, the PMDB is adamantly opposed to any substantial revision of the
laws concerning land ownership. Sooner or later, the PMDB and the MST will
find that Lula’s camp is not big enough for both of them, and given the fact that
the MST has no significant representation in Congress, it is not difficult to guess
which way Lula will turn if forced to choose.
The MST’s most important contribution to Lula’s election was its agreement to
temporarily halt its campaign of land invasions, which might otherwise have
been used by the center-right to paint the PT with the brush of radicalism. But as
the months have passed without action on the land reform front, the MST is
growing restive and the invasions have been resumed with a vengeance. The
MST has carried out more land invasions in the five months since its moratorium
was ended in March 2003 than were undertaken in all of 2002.
The tactic of taking over property owned by others is potentially explosive. The
invasions often turn violent, and landowners have threatened to create their own
militias to protect their assets if the government refuses to take action against the
MST.
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International Country Risk Guide
September 2003
Lula is scrambling to reach an agreement with MST leaders, but there is little
chance that the government will be able to bear the cost of meeting their
demands without jeopardizing the fulfillment of the fiscal goals outlined in
Brazil’s agreement with the IMF. In the meantime, farmers are flexing their
muscle in the Congress, which has launched an official investigation of the
movement.
Outlook
All indications are that the president will face growing pressure from both
directions, and will ultimately be forced to restrain the MST, by force if
necessary. In that event, Lula will be hard-pressed to persuade the country’s
non-privileged classes that the campaign promises he made are not mutually
exclusive. In short, the explosion of popular anger that greeted pension reform is
likely to be repeated in the months to come.
Moreover, it is not even clear that he will be able to count on the support of his
newfound allies on the center-right as he proceeds down the path of reform.
Lula’s next project—tax reform—promises to be even more controversial than
the pension reforms, and it is doubtful that it can win passage in its current form.
The key component of the tax reform plan is the introduction of a national goods
and services tax to replace the current system under which individual states set
their own tax level. In seeking investment, some states have attempted to
increase their competitiveness by dropping their tax rates to the point of
producing chronic revenue shortfalls.
Opposition to Lula’s plan is widespread. On the one hand, the tax measure faces
resistance from business and local interests that contend that the tax burdenwhich has grown from about 26% of GDP in the mid-1980s to 37% of GDP
currently-is already far too high. On the other hand, leaders from states whose
attractiveness has enabled them to set high tax rates confront the uncomfortable
prospect of being forced to make spending cuts if the lower federal rate is
imposed.
*
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*
*
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International Country Risk Guide
September 2003
COSTA RICA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
76.0
37.0
36.5
74.8
Low
Current
09/03
74.0
37.0
33.5
72.3
Low
One Year
Ahead
Worst Best
Case
Case
78.0
82.0
36.0
38.0
32.0
35.0
73.0
77.5
Low
Low
Five Years
Ahead
Worst
Best
Case
Case
78.0
84.0
30.0
39.0
30.0
37.0
69.0
80.0
Mod. V.Low
POLITICS
Government Stability
President Abel Pacheco’s Social Christian Unity Party (PUSC) administration
has come under a barrage of protests from organized labor in recent months that
pose a significant threat to the government’s plans to revitalize the economy
through structural reforms and the pursuit of free-trade agreements, and he is
clearly feeling the strain. In late June, the president was ordered by his doctor to
take a week’s rest due to “stress and fatigue accumulation” caused by the many
problems confronting his administration. Pacheco, who is 70 years old and a
diabetic, has more recently been diagnosed with high blood pressure, presumably
the result of more than a year of 14-hour workdays without a vacation.
Popular Support/Legislative Strength
While Pacheco’s strenuous efforts have done little for his health, they have done
even less for his popular support. The president won his office by garnering
58% support in a run-off contest against Rolando Araya, the candidate of the
National Liberation Party (PLN), in April 2002. At the completion of his first
100 days in office in mid-August 2002, he commanded the approval of 63% of
the country’s voters, the highest level by any president at that point in his term.
However, the results of a poll conducted in early July of this year showed that
only 39% of Costa Ricans rated his administration’s performance as “good” or
“very good,” while 29% judged it to be “bad” or “very bad,” compared to figures
of 46% and 22%, respectively, in a poll conducted three months earlier.
The president’s declining popular support can only serve to reinforce the
weakness of his government, which controls just one-third of the 57 seats in the
Legislative Assembly, making him all the more susceptible to pressure from nongovernmental interest groups. The government’s capitulation in early June to the
demands of striking workers at the Costa Rican Electricity Institute (ICE), the
state-owned electric and telecommunications monopoly, has proved politically
costly, as other labor groups, smelling blood in the water, have been encouraged
to press their own demands.
Cabinet Instability
In response, Pacheco has effectively ceded a substantial chunk of his presidential
authority to his opponents, in the process compounding his political difficulties.
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September 2003
In seeking resolution of the ICE strike, the president pledged to consult with a
broad spectrum of public-sector unions on matters of policy, a concession that all
but rules out any progress in the area of privatization, and presents a potentially
insurmountable obstacle to Costa Rica’s inclusion in the anticipated Central
American Free Trade Agreement (CAFTA) currently being negotiated between
the US and five Central American governments.
Even more worrisome is the extent to which forces outside the government
appear to have gained control over the president’s personnel decisions. In late
May, Minister of the Presidency Rina Contreras was moved to a less visible post
in the administration after a group of 28 legislators informed Pacheco they found
her style abrasive and could not work with her. In early June, Education
Minister Astrid Fischel stepped down under pressure from striking teachers.
In early July, Science and Technology Minister Rogelio Pardo resigned after
being publicly rebuked by Pacheco over remarks that were interpreted by
organized labor as suggesting that the government had plans to privatize ICE.
Pardo claimed that his reference to “privatizing aggregate values” was not
intended to apply to electricity and telecommunications, but rather to other
services, such as call centers and Internet services.
However, when the labor unions complained, Pacheco sent a note to Pardo
informing him that “by diverging from the [government’s] line of thought, you
are threatening social peace,” and instructing him to declare publicly that he
was speaking his own mind on the matter.
Given such obvious lack of support from the top, it is hardly surprising that
Cabinet officials have been rushing to the exits throughout Pacheco’s first 15
months in office. Pardo’s departure brought to eight the number of ministers
who have left the government since Pacheco took office in May 2002.
Corruption
Adding to Pacheco’s troubles, the PLN and the Citizen Action Party (PAC),
which have formed a majority opposition alliance in the Legislative Assembly,
have launched an investigation into allegations of campaign financing
irregularities by the PUSC.
According to the opposition, a total of $175,500 deposited into an account
bearing Pacheco’s name during the 2002 campaign was not reported to the
Supreme Election Tribunal (TSE), as required by law. In addition, the
opposition claims that Pacheco’s campaign received a donation of $50,000 from
a firm based in Panama. Donations from foreign sources are illegal under Costa
Rican law.
Responding to the allegations, in early August, the president ordered that his
private financial records, including a joint account shared with his wife, be made
public. As for the allegedly unreported contributions, Pacheco claims to not
have known of the account’s existence or how the money deposited in it was
used.
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International Country Risk Guide
September 2003
ECONOMY
In something of a contrast to the unrelenting bad news Pacheco has received
from the political front over the past few months, there have been some signs of
improvement in the economic arena. According to official figures, both the trade
and fiscal deficits were reduced during the first six months of 2003.
The central bank reported that the trade deficit narrowed to $658 million during
January-June, compared to $1.02 billion in the same period in 2002, mainly
owing to an increase in manufactured exports, especially semiconductors
produced by the Intel Corporation. Exports for the first half of 2003 rose by
23% compared to the same period a year earlier, while imports rose by only 6%
compared to 2002.
According to the Finance Ministry, the budget deficit stood at $222.5 million in
late June, 12% lower than the level in June 2002, as tax revenues increased by
16%. Meanwhile, government spending grew by 10% compared to a year
earlier.
Central Bank President Francisco de Paula Gutiérrez offered a positive
assessment of the economy in late June, stating that economic figures from the
first half of the year suggest a somewhat more dynamic economy than originally
expected, and that real GDP growth would be higher than the 2.2% originally
forecast, possibly even exceeding the 2.7% rate registered in 2002. Gutiérrez
added that although the government was unlikely to achieve its goal of reducing
the fiscal deficit to 3.1% of GDP, he was confident that the fiscal shortfall would
be held under 4% of GDP.
Pacheco’s most senior economic advisor, Ronulfo Jiménez, echoed the positive
government line, declaring in late June, “We are seeing more growth than we
had estimated at the end of 2002, and significantly more growth than the
economy showed during the first months of last year. The economy is showing
strong signs of recovery.”
But not everyone agrees. Alberto Dent, who was named to replace Walter
Bolaños as finance minister in late June, has offered a markedly less sanguine
assessment of the country’s near-term economic prospects. Citing the negative
impact of accounting discrepancies recently uncovered in ICE’s books and
higher levels of programmed spending in the second half of the year, Dent has
warned that the fiscal shortfall could expand to 5.2% of GDP in 2003. Speaking
to reporters shortly after he was named as Bolaños’ replacement, Dent asserted,
“It seems to me that we are running the risk of closing [the year] with an
enormous fiscal deficit, and for that reason we will begin to close off spending
on everything that is not absolutely necessary.”
That hardly sounds like a strategy likely to promote robust growth in the second
half of the year. But given Pacheco’s political vulnerability, it is doubtful that
Dent will be given a free hand to dispense harsh fiscal medicine when few others
in the administration are even willing to admit that there is a disease.
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September 2003
CUBA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
62.5
31.0
35.0
64.3
Mod.
Current
09/03
58.5
28.5
33.5
60.3
Mod.
One Year
Ahead
Worst Best
Case
Case
45.0
62.0
27.0
30.0
29.0
34.0
50.5
63.0
High
Mod.
Five Years
Ahead
Worst
Best
Case
Case
45.0
68.0
20.0
36.0
25.0
38.0
45.0
71.0
V.High Low
POLITICS
External Conflict
European Union
A decades-long friendly relationship between Europe and the Communist Party
of Cuba (PCC) government headed by President Fidel Castro shows every sign
of coming to an acrimonious end, following the EU’s imposition of diplomatic
sanctions in response to the Cuban government’s crackdown on the Caribbean
island’s tiny democracy movement in March 2003. Beyond the diplomatic
consequences of the falling out with Europe, the souring of relations has
potentially grave implications for a Cuban economy already in critical condition.
In the more than four decades since Castro came to power to in Cuba, the US has
gone to extraordinary lengths to undermine the island’s Communist regime. In
contrast, European nations have lauded the indisputable achievements of
Castro’s revolution—particularly those in the areas of health care and
education—and consistently condemned Washington’s economic embargo of the
country, while ever so gently scolding the Cuban government for its failure to
respect basic human rights.
However, all that changed with Castro’s crackdown, which began on March 18,
just one day before US-UK forces launched their invasion of Iraq. Howls of
protest went up within Europe’s corridors of power as dozens of internationally
renowned dissidents and independent journalists were sentenced to lengthy
prison terms—all in a matter of weeks. Even more disturbing were the summary
trial and subsequent execution of three would-be hijackers who commandeered a
ferry in hopes of making their way to the US coast.
Castro claimed the crackdown was provoked by the US, which openly funneled
millions of dollars in funds to dissident groups through its diplomatic mission on
the island. The Cuban leader further asserted that the dissidents’ acceptance of
financial support from a foreign source was an act of treason, a position that has
been upheld by the Supreme Tribunal, Cuba’s court of last resort, which by late
June had confirmed the prison sentences of most of the jailed dissidents.
But European political leaders were having none of that. In late April, the EU
indefinitely suspended consideration of Cuba’s application for preferential trade
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September 2003
status and enhanced financial assistance under the Cotonou agreement,
prompting Cuba to withdraw its application in May. Then, in early June, the 15members states of the EU voted unanimously to stop high-level diplomatic visits,
increase financial and other support for Cuban dissidents, and review the bloc’s
overall relations with Cuba.
Castro, the Diplomat
In the face of a major diplomatic crisis involving his country’s most important
source of trade and tourism, Castro proceeded to pour fuel on the fire. Days
after the EU announced its diplomatic sanctions and US Secretary of State Colin
Powell hinted that the US and the EU were considering adoption of a joint policy
toward Cuba, Castro delivered a televised address in which he vilified European
leaders and called upon the Cuban people to participate in governmentsponsored demonstrations against the sanctions.
The chief targets were Spain, whose prime minister, José María Aznar, was the
driving force behind the diplomatic sanctions, and Italy, which cut off some $45
million in aid. Castro ridiculed Aznar as “the little fuehrer with the moustache,”
and dismissed Italian Prime Minister Silvio Berlusconi as a “fascist” and a
“clown.”
On July 26, in a speech commemorating the 50th anniversary of the assault on the
Moncada barracks in Santiago, the opening clash in the country’s revolution,
Castro continued his rhetorical attack, unleashing a stream of invective
traditionally reserved for political leaders in Washington. Aznar once again
received special consideration, as Castro vilified the Spanish premier as “an
individual of markedly fascist lineage and ideology.”
Asserting that neither the US nor the EU would “have the final word on
humanity’s fate,” Castro pointed to the ongoing struggle of developing nations to
overcome the hobbling effects of centuries of European imperialism, and called
on the leaders of Europe “to calmly reflect on your mistakes without getting
carried away by an excess of rage or Euro-narcissistic drunkenness.” Then,
beating the Europeans to the punch, he announced that Cuba would refuse all
aid-including humanitarian assistance-from the EU.
Beyond the Rhetoric
Despite the heated rhetoric, it remains an open question what impact the
changing nature of relations with Europe will have on Cuba’s economy. The EU
is Cuba’s most important trading partner and its largest source of foreign
investment; during 1990-1998, European firms invested an estimated $640
million in the country, mostly in the tourism sector. Moreover, European
travelers account for more than one-half of all business in the tourism sector,
which is the island’s single most important source of hard currency. As such,
any moves that pose a threat to commercial ties would hold the potential to
devastate the Cuban economy.
But such moves have not as yet been undertaken, and despite some noise from
Italy, none are expected in the foreseeable future. The EU member states have
already ceased active promotion of investment and trade ties with Cuba in return
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September 2003
for a promise from the US not to impose penalties on European companies doing
business in Cuba as authorized by its controversial Helms-Burton law. But many
European political leaders (and a sizeable minority of US lawmakers) believe
that a policy of engagement is the more effective way to undermine Castro’s
regime, and they are unlikely to introduce US-style restrictions on trade and
investment, statements from Washington to the contrary notwithstanding.
Human rights organizations are hopeful that the EU’s official condemnation of
Cuba’s rights record may lend force to their efforts to dissuade European
travelers from visiting the island. However, the government’s tourism figures
through the end of June indicate that the campaign is not having much effect.
According to official data, tourist arrivals in the country reached one million on
June 29, one day earlier than in 2001 (the best-ever year for the industry) and
fully one month earlier than in 2002. According to Eric Peyre, Cuban sales
director for the French hotel company, Accor, summer bookings from the UK
and other European locations are well above expectations.
Debt Pressures
Outside of the tourism sector, European businesses face growing disincentives to
doing business in Cuba, but the cause has little to do with the recent diplomatic
row. European firms have faced increasing delays in receiving payment for their
goods and services since late 2001, in part owing to a loosening of US
restrictions on direct sales of food. The US demands cash payment for all
purchases made by Cuba, with the result that Havana is using lines of credit it
secured in Europe to pay for goods received from the US.
In addition, Cuba’s foreign exchange reserves came under heavy pressure in
2002 as a result of a decline in the tourism sector and production losses arising
from a wrenching restructuring of the vital sugar industry, as well as a
substantial increase in the oil imports bill following the collapse of a preferential
purchase arrangement with Venezuela.
The long-term impact of Cuba’s financial crunch was recently detailed by
Dennis Flannery of the Inter-American Development Bank (IDB), who warned
that the country’s debt has grown so rapidly in recent years that much of it will
probably have to be forgiven in the post-Castro era. Quoting a US State
Department report, Flannery asserted that Cuba’s hard currency debt reached
$12.2 billion in 2002, and that the country has already accumulated $1 billion in
commercial arrears.
The pressure on the country’s hard currency reserves has not eased, as became
clear in July, when the central bank unexpectedly announced a significant
tightening of foreign exchange controls that has substantially compounded the
difficulties faced by foreign entities trying to conduct business on the island. On
July 21, the central bank issued a decree ordering state-owned enterprises to
surrender all foreign currency to the central bank and prohibiting the use of the
US dollar for business transactions within Cuba. Under the decree, public-sector
companies would be required to purchase dollars for import and debt payments
through Cuban banks, subject to the approval of the central bank. The central
bank has up to 30 days to respond to all requests for dollars.
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The announcement of the foreign exchange controls caused much consternation
among the foreign business community, whose members were alarmed at the
prospect of a further month-long delay in collection of payments and arrears
from the cash-strapped state. Several foreign companies stated that they would
cease to carry on business with state-owned enterprises until they were provided
with details regarding how and when they would receive payment. Central Bank
President Francisco Soberon Valdes sought to offer reassurances to foreign
diplomats and business representatives by almost immediately scaling back some
of the restrictions, including an exemption for joint ventures.
But business interests remain wary, particularly in light of recent
pronouncements by Castro that there are too many dollars in circulation and the
decentralization of trade has gone too far. Such statements, coming on the heels
of the legal assault on democracy advocates, have fueled investors’ fears that
Castro is having second thoughts about reform. It is that consideration,
combined with cuts in European financial support that promise to prolong
Cuba’s financial difficulties, that accounts for the potential for the crackdown to
damage the country’s economy.
United States
For its part, the US continues to exhibit marked ambivalence about its relations
with Cuba. For the third consecutive year, a bipartisan group of lawmakers in
both houses of the US Congress has introduced legislation calling for an easing
of restrictions on travel to Cuba by US citizens. However, as in the past, a
minority of influential congressional Republicans has managed to keep the
measure in limbo. In any case, President George W. Bush insists that he will
veto any legislation aimed at loosening the embargo.
In recent months, Bush has come under increasing criticism over his
administration’s Cuba policy, not from those favoring a normalization of ties,
but rather within the Cuban-American exile community in Florida, which has
expressed frustration with Washington’s failure to follow through on the “gettough” stance adopted by President Bush in mid-2002.
Particularly galling to the committed anti-Castro forces in the US is the Bush
administration’s decision to uphold the so-called wet-foot/dry-foot law. Under a
1994 agreement, any Cuban refugees who come ashore in the US are permitted
to stay, can obtain work permits, and are eligible to seek permanent resident
status after one year. Those detained at sea are returned to Cuba, no doubt to
face an unhappy fate.
The issue came to the fore in late July, when the US repatriated 12 Cuban
refugees intercepted at sea. In early August, some 100 members of the Cuban
American National Foundation (CANF), a strongly anti-Castro exile group, sent
a letter to President Bush, warning that the Cuban community in Florida would
have no choice but to reconsider its support for Bush’s Republican Party if the
administration failed to turn up the pressure on Havana.
This is no idle threat. As was the case in his victory in 2000, Bush’s hopes for
re-election in 2004 could well hinge on the outcome of the vote in Florida,
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September 2003
particularly if prolonged economic troubles continue to erode the president’s
popular support. There is no question that he cannot expect victory in Florida
without the Cuban vote.
Among the demands outlined in the letter, whose signatories included numerous
Republican officeholders, were an end to the repatriation of Cuban refugees; a
substantial increase in financial support for Cuban dissidents; steps to overcome
Cuba’s jamming of US government radio and television broadcasts tailored for a
Cuban audience; and indictments against Castro and others responsible for the
1996 shoot-down of two private planes by Cuban fighter jets that resulted in the
deaths of four Cuban-Americans.
The ultimatum from the CANF came just days after the US Senate finally
confirmed Roger Noriega to the post of assistant secretary of state for western
hemisphere affairs, officially filling the position for the first time since 1999.
The early indications are that Noriega’s plans for the Bush administration’s
Cuba policy mesh neatly—and not coincidentally—with the demands outlined
by the Florida Cubans.
Noriega has stated unequivocally that a tightening of the embargo “is not an
option,” but that no easing of restrictions will be considered in the absence of
democratic and free-market reforms on the island, the stance enunciated by
President Bush in May 2002. He has stated that his priority will be to shift the
focus of debate from the embargo to conditions within Cuba, emphasizing
support for domestic dissidents, enhanced dissemination of information, and
greater coordination with Europe to promote democratic change on the island.
Although short on details, Noriega’s proposals have already drawn heat from
critics who argue that by publicizing its support for Cuban dissidents, the US
stands to undermine the legitimacy of democracy advocates by allowing Castro
to paint them as agents of Washington. The Cuban leader has shown himself to
be a master at manipulating fears of US interference in the island’s domestic
affairs to strengthen his hold on power and limit the appeal of his opponents, and
there is every reason to expect that he will continue to do so, with similar
success. In the meantime, Cuban authorities can busy themselves preparing jail
cells for those dissidents bold enough to take the US up on its offer.
*
20
*
*
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September 2003
HAITI
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
45.5
35.5
27.0
54.0
High
Current
09/03
45.0
31.5
25.5
51.0
High
One Year
Ahead
Worst
Best
Case
Case
30.0
45.0
27.0
32.0
22.0
27.0
39.5
52.0
V.High High
Five Years
Ahead
Worst
Best
Case
Case
30.0
60.0
25.0
36.0
22.0
37.0
38.5
66.5
V.High Mod.
POLITICS
Internal Conflict
In late May, the Haitian National Police (HNP) destroyed a number of illegal
weapons seized during a year-long campaign to disarm the pro-government
People’s Organizations, an apparent step toward fulfillment of a key condition
set down by the Organization of American States (OAS) to secure the release of
frozen international financial assistance. Jean-Claude Jean-Baptiste, at the time
the acting director of the HNP, declared of the event, “It is a great day. It
affirms the government’s will to end confrontation and violence as a way to
resolve conflict.” Leaders of the opposition Democratic Convergence (CD)
derided the destruction of the weapons as a “show for the OAS.”
The OAS has been attempting to broker a resolution of a crippling political
conflict stemming from the disputed results of legislative elections held in May
and November 2000, which gave President Jean-Bertrand Aristide’s Lavalas
Family (FL) overwhelming majorities in both houses of the National Assembly.
The opposition parties, who subsequently combined their forces in the
Democratic Convergence (CD) bloc, contend, with most international observers
concurring, that the voting was marred by serious irregularities. As a result, the
international community, led by the US, has halted the flow of desperately
needed foreign aid until the political stalemate is broken.
For his part, Aristide has expressed a willingness to meet the conditions outlined
by the OAS in Resolution 822 (issued in September 2002), which, in addition to
disarming the People’s Organizations, require the formation of a new Provisional
Electoral Council (CEP) that includes members of the CD, in preparation for the
holding of fresh elections by the end of 2003. However, the CD has refused to
nominate any representatives to the CEP, claiming that the government has
failed to meet its obligation under Resolution 822 to ensure a climate of security
conducive to the holding of free and fair elections.
Attack on Opposition Meeting
Support for the CD’s position came in mid-July, when a group of rock-wielding
thugs attacked and broke up a meeting of the Group of 184 (G-184)—an antigovernment umbrella organization that includes political parties, labor unions,
student and church groups, and civic organizations—in Cite Soleil. Several
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September 2003
dozen people were injured in the attack. According to eyewitness reports, the
rock-throwers were chanting, “Aristide for life, Aristide is a king,” among other
slogans, during the attack.
Far more damning evidence came from Johnny Occilius, a municipal employee
in Cite Soleil, who after fleeing to the US alleged that Mayor Fritz Pierre, a
member of the FL, had paid two local gang leaders a total of $12,500 to organize
the attack on the meeting. The US embassy subsequently confirmed the
involvement of the FL in the incident, citing information obtained from Occilius
and its own sources.
Government Counterclaims
The government has been giving as good as it gets, blaming the opposition for
the assault on the G-184 meeting, as well as a host of other violent incidents
before and since. As for the July rock-throwing incident, government officials
charged that Aristide’s opponents had “provoked” local residents, who had
spontaneously attacked the meeting.
Secretary of State for Public Security Jean Gerard Dubreuil likened the G-184
meeting in Cite Soleil to the white supremacist Ku Klux Klan organizing a rally
in the largely black neighborhood of Harlem in the US city of New York.
When a fire broke out in Port-au-Prince’s McDonald Open Market a few days
later, Prime Minister Yvon Neptune immediately pointed the finger of blame at
the CD. Jonas Petit, the interim leader of the FL, labeled the fire an “act of
sabotage” aimed at undermining the government’s efforts to improve conditions
in the country.
In late July, four employees of the Interior Ministry were killed and one
seriously wounded in an ambush while traveling in the Plateau Central region, an
area in which the level of security has been particularly poor. Interior Minister
Jocelerme Privert blamed the attack on the Force for Citizen Protection (FPC), a
group that the Interior Ministry contends receives arms and financial support
from the political opposition.
Conspiracy Allegations
CD leader Evans Paul responded to the charges by claiming that the Interior
Ministry had sent its personnel into an area known to be violent without
providing adequate protection, in the expectation that their wholly expected
deaths would provide the government with a pretext for cracking down on its
opponents.
That position was backed up by Chavanne Jean-Baptiste, the leader of the
Papaye Peasant Movement in Plateau Central, who claimed that much of the
violence in the area stemmed from fighting between local FL factions over
control of government funding to the area and smuggling operations that are
carried out in the border region. Jean-Baptiste went on to claim that “the
situation is being used as a pretext by the government to spread fear” and to
blame the opposition.
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September 2003
Law and Order
Further evidence that the government is not pursuing fulfillment of its
obligations under OAS Resolution 822 in good faith came in early June, when
Jean-Robert Faveur, the newly installed head of the HNP, resigned his post after
just two weeks on the job and went into hiding in the US. Faveur replaced the
controversial Jean-Claude Jean-Baptiste, a longtime ally of Aristide, who was
appointed as head of the HNP in late March, only to be forced to resign when his
nomination provoked a storm of controversy and the Senate failed to confirm of
his promotion.
In his letter of resignation, which was addressed to Aristide but also sent to a
number of other officials and the press, Faveur alleged that the president had
effectively stripped him of all of the authority. He claimed that he had been
ordered to clear all of his decisions with Secretary of State for Public Security
Jean Gerard Dubreuil, and that he had been instructed to rubber stamp a whole
series of promotions and assignment orders signed by Jean-Baptiste just before
he left office. According to Faveur, he was denied any control over the HNP’s
budget, and had intentionally been left off the signature card for signing
government checks.
The final straw for Faveur was when two of Aristide’s political allies, one of
whom is a member of the Cabinet, presented him with a list of militants
operating in the Plateau Central region who were to be integrated into the ranks
of the HNP. Faveur interpreted the order as an attempt to bestow legitimacy on
the violent actions of the government’s supporters, and decided that he could not
retain his post.
Predictably, Aristide’s government wasted no time launching a campaign to
smear Faveur. Foreign Minister Joseph Philippe Antonio claimed that Faveur
was a tool of foreign interests (i.e., the US) who had used him to destabilize the
government. Justice Minister Calixte Delatour accused Faveur of deserting his
post, and compared him to a mad dog.
Faveur has been replaced by Jocelyne Pierre, a judge who previously headed the
civil court in Port-au-Prince. Pierre’s appointment drew immediate and heavy
criticism from the CD and rights groups. Opposition spokesman Mischa
Gaillard warned that the “appointment is not conducive to establishing a secure
environment for the electoral process.” The National Coalition for Haitian
Rights (NCHR) charged that Pierre’s judicial record as indicating subservience
to the FL, and warned that her appointment would only serve to further politicize
the HNP.
The HNP’s ability to provide the necessary security for the holding of credible
elections was further cast into doubt in early August, when Jean-Dady Simeon,
the former spokesman for the HNP, went into exile in Canada, claiming that he
received a death threat in a phone call that was traced back to a police station.
Simeon contended that his superiors had assured him that an investigation would
be conducted, but no results were ever reported to him.
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September 2003
External Conflict
United States
Given the obvious mistrust between the government and the opposition, and the
continuing high level of insecurity that makes it increasingly unlikely that
elections can be held by the end of the year, the OAS has begun to consider it
options. At a meeting of the OAS General Assembly in early June, US Secretary
of State Colin Powell proposed that Haiti be given until the end of September to
create conditions favorable to the formation of a functioning CEP and the
organization of elections. In the absence of concrete progress by that time,
Powell suggested that the OAS should re-evaluate its role in Haiti.
The meaning of Powell’s proposal is not entirely clear. On the one hand, it
could be interpreted as nothing more than a suggestion that the OAS withdraw
from an active role in seeking a political resolution, effectively leaving the
government with no avenue to access the frozen international financial support.
But Powell may have been alluding to (or attempting to leave the impression that
he was alluding to) the Inter-American Democratic Charter (IADC), which
empowers the OAS to take action, including military intervention, “when
situations arise in a member state that may affect the development of its
democratic political institutional process or the legitimate exercise of power.”
Haitian officials downplayed the threat posed by Powell’s proposal, noting that
the US was but one of 34 members of the OAS, and reiterating the position that
Aristide’s regime had fully done its part to comply with the conditions of
Resolution 822.
However, Himler Rebu, a former colonel in the now defunct Haitian army,
warned that the FL would do well to take Powell’s remarks seriously, noting that
the penchant of the current administration in Washington for taking unilateral
action on the international front meant that Haiti could not depend upon the
opposition of other OAS members to forestall a military response from the US.
Rebu added that many of the military personnel who were responsible for the
intervention that restored Aristide to power in 1994 remain in decision-making
positions today.
What the US government might have in store for Haiti became all the more
difficult to discern in July, when CD leader Evans Paul publicly complained that
Washington was sending incoherent and contradictory signals to the opposition.
According to Paul, some elements of the US government have been urging the
opposition to seek a compromise with Aristide, while other agencies in
Washington have told the CD not to bother with negotiations “because other
things are going to be done.”
Meanwhile, US officials continue to heap criticism on (and to convey veiled
threats to) Aristide’s government. At a US Senate Foreign Relations Committee
hearing in mid-July, Mark Grossman, US undersecretary of state for political
affairs, stated, “The government of Haiti has not complied with many of its most
important commitments under Resolution 822, particularly those that would
contribute to a climate of security,” before adding, “Hemispheric patience is
running out.”
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Senate Foreign Relations Committee Chairman Richard Lugar added that
unstable conditions in Haiti posed a danger to US national security, stating,
“Corruption, drug trafficking, and illegal migration are areas of deep concern
for our two countries. Mass migration has the potential to create instability in
the region and undermine efforts to improve border control.”
ECONOMY
On the economic front, the government recently bought itself economic
breathing space by paying off some $32 million in arrears to the Inter-American
Development Bank (IDB) and reaching an agreement with the IMF, clearing the
way for the release of nearly $200 million of the more than $500 million in
foreign funds that have been frozen since 2000.
In an effort to encourage greater cooperation from Aristide’s government, the
OAS gave the green light for the partial lifting of the freeze on international
financial assistance in 2002, requesting that the IDB move to resume normal
relations with Haiti. However, as the organization is prohibited from making
new loans to countries in arrears on previous debt, the Haitian government first
had to come up with the funds to bring its accounts up to date.
In early July, the government used a bridge loan from the central bank to pay off
its arrears to the IDB, practically wiping out the country’s foreign exchange
reserves in the process. The payment secured the release of a $35 million budget
support loan that will be used, in part, to pay back the central bank for the bridge
loan.
At the US Senate Foreign Relations Committee meeting held in mid-July, US
Deputy Secretary of the Treasury for International Affairs John Taylor stated,
“The government of Haiti has taken important actions to strengthen public
finances and create conditions for greater macroeconomic stability. With
arrears…cleared, the IDB can now move forward with a number of projects
already in train, and re-engage with Haiti to discuss future lending.”
Further progress toward gaining additional international financial support came
in August 2003, when the government reached an agreement with the IMF for a
12-month staff-monitored program (SMP), under which it is committed to
trimming the budget deficit from 5.5% of GDP for the period October 2002March 2003 to just 2.7% of GDP in April 2003-September 2003. During the
same period, the government has targeted a reduction of inflation from 13% to
10%. A revised budget for 2003/2004 includes a series of revenue measures and
deep cuts in discretionary spending.
If the government meets the targets agreed under the SMP, it would become
eligible for up to $150 million in poverty reduction and economic development
loans from the IMF over the next year. While the fresh lending will help to
prevent an economic implosion that might contribute to even greater domestic
instability, loans from other sources, particularly the World Bank, the US, and
the EU, will remain frozen until a political settlement is reached.
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HONDURAS
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
60.5
34.5
32.5
63.8
Mod.
Current
09/03
60.5
36.0
28.0
62.3
Mod.
One Year
Ahead
Worst Best
Case
Case
60.0
66.0
30.0
36.0
25.0
30.0
57.5
66.0
High
Mod.
Five Years
Ahead
Worst Best
Case
Case
58.0
68.0
30.0
38.0
25.0
38.0
56.5
72.0
High
Low
POLITICS
Hell hath no Fury...
On top of his many other problems, President Maduro has become embroiled in
a personal soap opera that has created some instability within his government.
The root of the messy affair lies in animosity between Maduro's wife, Aguas
Ocaña, a former Spanish diplomat, and Mireya Batres, the president's former
love interest and his current minister of culture, arts, and sports.
In a statement to the press, Ocaña asserted that Maduro felt he had made a “big
mistake” by appointing Batres to her Cabinet post, and that he was “terribly
embarrassed by the way she has behaved.” Ocaña’s statements offended César
Batres, Mireya's father, who resigned in protest from his job as senior
presidential adviser. The elder Batres, a former foreign minister, was part of the
team of attorneys that successfully held off an attempt by the opposition to
disqualify Maduro from standing for the presidency in 2001.
The flap may be creating problems for Maduro on the home front, as well. On
the heels of César Batres' resignation, Ocaña returned to her native Spain for
“pressing personal reasons.” The scuttlebutt on the ground in Honduras is that
Ocaña is fuming over her husband's refusal to sack his old girlfriend, and that a
divorce announcement might be around the corner for the newlyweds, who were
only married in October 2002.
Law and Order
Drug Scandals
Drug trafficking seems to be prevalent not only on the streets of Honduras, but
also at various levels of government, including the national legislature.
Congressman Avila Panchame, a member of the ruling National Party (PN), was
arrested by police in July on drug-trafficking charges. Panchame's arrest
occurred just two weeks after Cesar Diaz Flores, a Honduran representative in
the Central American Parliament, was taken into custody on similar charges.
Panchame has maintained his innocence, although he will have a difficult time
reconciling that position with reports that he attempted to run over two police
officers who ordered him to stop his vehicle. For his part, Flores continues to
insist that he is protected by diplomatic and/or legislative immunity.
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The two cases are symptomatic of the increasingly apparent involvement of
members of officialdom-government, judiciary, and police-in the activities of
drug cartels. According to one government official, the investigation of such
cases is hampered by the deep roots of corruption in the country's political
culture.
President Ricardo Maduro has stated that his administration will not tolerate
illegal practices by officials, whether lawmakers or law enforcers. In late June,
the president announced plans for a "purification" of the police force. Under
legislation currently being drawn up by the government, authorities would be
permitted to immediately discharge any police personnel credibly accused of
corruption and provide for their trial before the Court of Justice. Currently, the
authorities have no legal recourse for dealing with police officials accused of
corruption.
Youth Gang Violence
Maduro won the presidency largely on an anti-crime platform and, since coming
to office, the focus of his government's law-and-order policies has been the
activities of youth gangs—the Mara. The administration has designed a youth
rehabilitation program, but Maduro acknowledges that the economic resources
needed to reform young gang members are limited. As such, his government's
priority has been locking up as many Mara members as possible.
That strategy appears to have made barely a dent in the level of crime actually
taking place on the streets. But if the allegations of rights groups are accurate, it
has made it much easier for authorities to eradicate the perpetrators of violent
criminal activity through extra-judicial means.
In April 2003, 69 people were killed in El Porvenir prison in La Ceiba as the
authorities reclaimed control of the prison following a bloody riot. Most of
those killed were Mara 18 gang members. The government has promised a full
investigation into the circumstances surrounding the killings, which have been
condemned by human rights groups and a local bishop, who charge that most of
the dead prisoners had already surrendered before they were shot. Initial
findings appear to confirm the accusations, and many are describing the incident
as a purging of gang members.
The similarity between the El Provenir killings and an incident earlier in 2003
involving the death of seven gang members at San Pedro Sula Prison points to
the possibility that a disturbing policy is being implemented among authorities
within the prison system.
However, the government is not likely to face widespread public pressure either
to investigate the claims of abuse or to punish any alleged wrong-doers among
law enforcement officials. With street violence soaring and unlikely to subside
in a climate of persistently high unemployment, frustrated, law-abiding
Hondurans have little sympathy for gang members.
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ECONOMY
Trouble with the IMF
As his administration continues its seemingly futile effort to combat crime,
Maduro continues to battle as well with the IMF. In early June, responding to
the IMF's demand that the government cut the public-sector wage bill, Maduro
announced that he would forego an agreement with the IMF if it did not relax its
conditions, declaring, "I am not going to subordinate the necessities of the
Honduran people to anyone."
The conclusion of a loan agreement with the IMF is required to win the release
of millions of dollars in additional multilateral assistance and forgiveness of as
much as one-third of the country’s foreign debt under the Heavily Indebted Poor
Countries (HIPC) initiative. Maduro stated that his government could seek
efficiencies, but asserted, "We cannot reduce the number of people who work in
health care, education or security." The submission of a Letter of Intent by the
government has been postponed until September, ruling out any chance of a new
agreement before the end of the year.
Investment and Trade Efforts
Despite the handicaps arising from the lack of an agreement with the IMF,
President Maduro has been working hard to convince Spanish business leaders to
invest in his country, highlighting opportunities in tourism, agriculture, and
infrastructure. He travelled to Madrid in June to sign an $80 million cooperation
agreement under the auspices of Spain’s bilateral aid program. Honduras, in
cooperation with Guatemala, El Salvador, Costa Rica, and Nicaragua, also
continues to pursue separate negotiations for free trade agreements with the US
and Canada.
Maduro is especially keen to maintain good relations with the US, as he made
evident in late May, when he pushed a bill through Congress authorizing the
deployment of Honduran troops to Iraq for peacekeeping and reconstruction
duties. Responding to vocal criticism of the deployment plan from his
opponents, Maduro defended the decision as befitting Honduras' “friendship and
solidarity” with the US. Perhaps, but opponents were quick to point out that
Maduro's show of support for US policy in Iraq came just two days after US
President George W. Bush approved a fourth extension of temporary protected
status (TPS) for illegal Honduran immigrants currently employed in the US.
*
28
*
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PANAMA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
72.0
34.5
35.5
71.0
Low
Current
09/03
72.0
35.0
36.0
71.5
Low
One Year
Ahead
Worst Best
Case
Case
65.0
75.0
31.0
36.0
34.0
38.0
65.0
74.5
Mod.
Low
Five Years
Ahead
Worst Best
Case
Case
58.0
78.0
30.0
39.0
30.0
40.0
59.0
78.5
High
Low
POLITICS
Government Stability
Presidential Campaign
Guillermo Endara, a dissident member of the governing Arnulfista Party (PA)
who will stand as the candidate of the Solidarity Party (PS) in the May 2004
presidential election, won the formal backing of another renegade Arnulfista,
banker Alberto Vallarino, in early June. The endorsement promises to provide a
substantial boost for Endara, who in recent months has been polling second
behind Martin Torrijos, the candidate of the opposition Democratic
Revolutionary Party (PRD).
Vallarino, a nephew of Arnulfo Arias, the PA’s namesake, broke with the PA in
1999 to run an independent campaign, finishing third with over 17% of the vote.
In 2002, he attempted to regain membership in the PA in hopes of standing as the
party’s candidate in the 2004 election. However, the effort was blocked by the
party’s leader, President Mireya Moscoso, and Vallarino abandoned his bid for
the presidency in January 2003, despite running neck-and-neck with Torrijos in
polls conducted at the time.
Backing from Vallarino stands to benefit Endara’s campaign on at least three
counts. The wealthy banker has very deep pockets, and can be expected to share
a goodly portion of his ample financial resources with the PS candidate. In
addition, had Vallarino been allowed to stand for the PA nomination, internal
party polls indicated he would have won by a landslide. As such, his support for
Endara is likely to transform the already steady flow of rank-and-file support out
of the PA toward the PS into a veritable flood. Finally, and perhaps most
important, Endara can also expect to gain the support of large numbers of nonPA voters who backed Vallarino’s independent campaign in 1999.
Torrijos in Front
So what does any of this mean for the likely outcome of the 2004 presidential
race? Probably not much, as Torrijos continues to enjoy a double-digit lead over
Endara, his nearest competitor, in pre-election polls. Of course, Torrijos held a
similar lead over Moscoso a year ahead of the 1999 election, only to see it
eroded as the election approached.
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But in 1999, Torrijos bore the burden of the fact that his party was in power, and
Moscoso gained ground by highlighting the perceived failings of Ernesto Perez
Balladares’ government. Even more significant, Vallarino staged a viable “third
way” campaign that had a real impact on the balance of support for the two main
parties.
This time around, Torrijos will be able to campaign as an alternative to a
thoroughly discredited PA administration. Although Endara is running on the PS
ticket, his PA roots—not to mention the rather dismal record he built during his
stint in the presidency in the immediate post-Noreiga period—are well known to
the country’s voters, and he may have a hard time fully avoiding the taint of
Moscoso’s failures.
Moreover, so catastrophic has been the decline of the PA that Endara has little
reason to hope that a third force—either the PA’s candidate, José Miguel
Alemán, or business magnate Ricardo Martinelli—will help his chances by
drawing support away from Torrijos.
In short, the election appears to be Torrijos’s to lose, and so far the PRD leader
has sought to avoid that possibility by saying little, and letting popular hostility
toward Moscoso do his talking for him. He has come out in opposition to some
of the current government’s most unpopular moves, particularly a regulation that
requires ordinary citizens to prove a direct interest in a matter—such as how
much the government spends on political junkets—in order to obtain information
about it. But, in general, his campaign platform has been notably short on
details, which he has promised to provide after he has had a chance to get out
among the people and hear their ideas about what the country needs.
Corruption
The need to root out a spreading rot of corruption that has permeated Moscoso’s
administration will no doubt figure prominently in the platforms of both Torrijos
and Endara. Torrijos has referred to the incumbent government as “a
nightmare,” while the PS candidate claims he is still “an Arnulfista in his heart,”
but that the PA has “gone bad.”
For their part, the president and her party seem to be almost pathologically
driven to provide as much ammunition as any anti-corruption crusader could
possibly want.
At the close of the regular legislative session in late June, the governmentcontrolled Assembly voted to end all investigations into allegations that bribes
were paid to numerous political figures to obtain the approval of the CEMIS
multimodal airport, container handling, and industrial park project in Colon.
The proposal was introduced by a PA deputy, Jacobo Salas, shortly before
midnight on June 29, and passed by a 39-14 vote at 3 a.m. on June 30.
The CEMIS corruption scandal first erupted in January 2002, when
Congressman Carlos Afú claimed that several of his colleagues in the PRD had
accepted payments ranging from $20,000-$150,000 to approve a 40-year, $400
million contract to build a multimodal logistics center in the Colon Free Zone.
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However, Afú only came forward with the allegations after being expelled from
the PRD by the party’s ethics committee over accusations that he accepted $1.5
million in exchange for his support for the appointment of two Supreme Court
justices belonging to President Moscoso’s PA.
In order to remove the cloud of suspicion, the PRD’s members in the Legislative
Assembly voluntarily waived their immunity from prosecution and invited an
investigation. Much to the chagrin of the PA, the ensuing investigation focused
not only on those accused by Afú, but every member of the Legislative
Assembly.
In mid-2002, Attorney-General José Antonio Sossa—a member of the Popular
Party, the PRD’s ally in opposition—subpoenaed the bank records of all
members of the Assembly, a move that provoked a howl of protest from the PA’s
ranks. Salas accused Sossa of abusing his power by investigating legislative
members against whom no formal charges had been lodged, and sought to have
criminal charges brought against Sossa.
The Supreme Court finally ruled on the matter in mid-August 2003, deciding that
Salas’s argument lacked a legal foundation. However, any investigation will
remain in limbo until the courts decide on the constitutionality of the maneuver
pulled off by the Legislative Assembly in late June.
Meanwhile, Afú, whose break with the PRD was instrumental in enabling the PA
to gain control of both the Supreme Court and the Legislative Assembly, has
announced that he will stand for re-election as a PA candidate. Given the fact
that Afú remains under a cloud of suspicion related to the accusations that he
sold his vote, the PA’s willingness to welcome him to the fold can only reinforce
the widespread view that the party is rotten to the core.
Internal Conflict
In late May, university students in the capital waged a two-day battle with antiriot police sent in to break up demonstrations organized to protest the
government’s tax reforms and electricity price hikes that were scheduled to take
effect in July. In early June, facing widespread opposition to the rate hikes,
Moscoso reached an agreement with the Public Utilities Regulating Board,
which is largely controlled by the electric companies, to shelve the price
increases.
The exact terms of the agreement were not disclosed. However, the El Panama
America newspaper reported that in exchange for canceling the rate hike, the
electric companies, in which the government owns a 49% stake, will be
permitted to keep up to $40 million in dividends owed to the state.
The students were at it again in late June, this time joined by the National
Association of Social Security Fund Administrative Employees (ANFACSS),
which launched a 10-day strike on June 24 to back their demand for the
extension of a $29.9 million loan to the Social Security System (CSS) to pay for
contractually mandated wage increases for which no provision was made in the
2003 budget.
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Social Security Conflict
The conflict at CSS in part reflects a protracted battle between members of
Moscoso’s administration, particularly Comptroller-General Alvin Weeden, and
CSS director Juan Jované. The personal feud first spilled into the streets in mid2003, when kidney patients blocked roads to protest Weeden’s refusal to approve
the purchase of cyclosporin by CSS. (Perhaps coincidentally, Moscoso’s
adviser, Alvaro Antadillas, owns a private kidney dialysis clinic, which stood to
gain from the lack of inexpensive access to the drug.) To end the disruptive
protests, Moscoso finally ordered Weeden to sign the purchase order.
As the labor and student protests gained momentum in late June, the CSS board
voted to extend a $25.9 million credit, an offer that was rejected by the unions.
At that point, unions representing doctors, nurses, and technicians employed at
CSS hospitals threatened to walk off the job if the board did not come up with
the full amount.
The conflict reached a climax on July 1, with the Chamber of Commerce calling
on the government to discharge all striking workers, Weeden making
unsubstantiated allegations that Jované falsified CSS financial data, and the
government accusing students and union members of seeking to foment political
instability.
Two days later, the government, the CSS board of directors, and ANFACSS
reached agreement on a deal to ensure that CSS workers will receive the pay
raises due under their contract. Weeden stressed that the government’s move
should not be interpreted as a retreat, although it is difficult to see how it might
otherwise be viewed.
Although the agreement appears to address the financial needs of CSS in the
short term, the long-term viability of the system remains a subject of some doubt.
The government had been engaged in negotiations with business and labor
representatives to develop a plan for shoring up CSS, but withdrew from the
discussions in mid-August, with officials stating that the administration will
formulate its own plan to submit to the legislature.
Any government plan that is put forward will probably include an increase in the
minimum number of years individuals must pay into the system to qualify for a
pension to 15 and the sale of some CSS assets. However, any moves in this
direction are likely to stir organized labor to action, and so no plan is expected to
be unveiled before the elections are held in May 2004.
Foreign Relations
United States
At home, Moscoso’s party is in decline and her government in retreat, but she
has enjoyed somewhat better success on the diplomatic front. In late June, she
met with US President George W. Bush and gained the American leader’s
tentative agreement to beginning negotiations for a free trade agreement (FTA).
Panama is looking to an FTA to address the worrisome imbalance in bilateral
trade; the US purchases just $335 million worth of Panamanian goods each year,
while annual US exports to Panama are in the neighborhood of $1 billion.
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The Panamanian government has been seeking an FTA with the US since the
early 1990s. Washington rejected a suggestion to include Panama in a regional
trade deal with five Central American nations that is currently well into the
negotiations process, stating the Panama represents a special case that warrants a
bilateral agreement. However, until June, there had been precious little progress
toward achieving that goal.
It appears that at least a partial explanation for Washington’s more
accommodating recent stance is the current government’s wholehearted support
for the Bush administration’s war on terrorism, including the move to oust Iraqi
leader Saddam Hussein. Commenting on the meeting between Bush and
Moscoso, Commerce and Industry Minister Joaquin Jacome enthused, “The
meeting could not have gone better. It is evidence that bilateral relations are at
an excellent level, in terms of both security and trade issues.”
But Panamanian officials need not celebrate just yet. An anonymous US source
told La Prensa that while Bush had given a green light to an FTA with Panama,
it would be an overstatement to characterize the US leader’s gesture as a
“commitment.” Moreover, during a White House press conference held
following the meeting, US Press Secretary Ari Fleischer commented positively
about Panama, but failed to mention anything about an FTA.
In any case, the conclusion of an FTA will be a long and involved process, and if
ever concluded, it will happen long after Moscoso is out of office. Nonetheless,
even the qualified indication of Bush’s support for a trade deal has been
interpreted as an important achievement among members of the administration, a
view that will likely be shared by members of the business community.
*
*
*
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UNITED STATES OF AMERICA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
75.5
35.0
40.5
75.5
Low
Current
09/03
81.0
33.0
38.0
76.0
Low
One Year
Ahead
Worst Best
Case
Case
76.0
83.0
34.0
36.0
36.0
40.0
73.0
79.5
Low
Low
Five Years
Ahead
Worst
Best
Case
Case
78.0
88.0
30.0
38.0
36.0
42.0
72.0
84.0
Low
V.Low
POLITICS
Government Stability
Popular Support
The clear evidence that the war in Iraq is far from over—a point that has been
driven home by a series of deadly bombings carried out against international
targets and vital infrastructure—and dire warnings that a prolonged US-led
occupation will carry a massive financial cost have given President George W.
Bush much to ponder with the approach of presidential and legislative elections
in November 2004.
The difficulties encountered in Iraq, the failure of US authorities to apprehend
either Saddam Hussein or Osama bin Laden, the still tentative economic
recovery, and questions about the Bush administration’s honesty in making the
case for war against Iraq have combined to undercut the president’s popularity in
recent months, providing the opposition Democratic Party with a glimmer of
hope for a resurgence in 2004.
The results of a poll conducted by the Pew Research Center in early August
showed the president’s popularity rating at 53%, close to the level he enjoyed
prior to the September 2001 terrorist attacks on the US. The poll numbers
indicated a continuing slide in Bush’s popular support, which stood at 86%
immediately after the September 2001 attacks, and, following a decline, rose to
74% during the height of the war in Iraq in April 2003.
The primary source of the president’s sagging poll numbers appears to be
dissatisfaction with his handling of the economy. Fully 57% of those surveyed
in the August poll believed the President Bush should focus greater attention on
the economy and less on the war on terrorism, compared to just 27% who
expressed that opinion in a poll conducted in July.
The president’s declining support comes as good news for the Democrats, but
the poll revealed that a hypothetical challenger from the opposition party would
still lose to Bush in a presidential election by a margin of 43% to 38%. Even so,
that represents a net gain of nine percentage point by the Democrats since April,
when a Pew poll conducted shortly after the fall of Baghdad projected that Bush
would defeat a Democratic challenger by 48% to 34%.
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Likewise, a July poll commissioned by the Wall Street Journal and NBC News
suggested that Bush would likely defeat any of his potential Democratic rivals in
the next election. However, the survey found that Democrats received higher
marks on most domestic issues, which the August poll conducted by Pew
indicates are increasingly becoming a priority for voters.
External Conflict
Iraq
That is not to say that developments in Iraq will not be a significant factor in
determining the outcome of the next elections, especially as the financial costs of
the post-war occupation mount, posing a direct threat to hopes for an economic
rebound in the near term. Moreover, the mounting death toll among US military
forces—more soldiers have been killed since the president announced the
cessation of major hostilities on May 1 than died during the period of heavy
combat—represents another cost that Americans may not be prepared to bear.
Negative perceptions of the war among the population back home, no doubt
fueled by news media’s focus on what has gone wrong since early May, have
also been reinforced by the government’s own missteps. A prime example is the
government’s notification that troops from the 3rd Infantry Division were to be
rotated home, only to then cancel the order at the last minute—a gaffe that
officials committed not once, but three times. The result was a large group of
angry and demoralized soldiers and their families, many of whom were only too
happy to share their feelings with the news media.
Family members of soldiers deployed in Iraq have become more vocal in their
criticism of the war as the death toll mounts, and the Bush administration shows
little indication of knowing how to bring an end to the fighting. The president
merely aggravated the situation with a completely thoughtless taunt of “bring it
on” in response to threats from anti-US elements in Iraq that they would wage a
persistent guerrilla campaign against US occupation forces.
If the human cost of the occupation has turned out to be greater than Americans
were led to expect, the same can be said of the financial burden of post-war
construction. In early July, the Defense Department announced that the bill for
post-war operations was running at about $4 billion per month—nearly double
the government’s initial forecast—and that the total cost will greatly exceed
previous estimates.
Before the war, military officials estimated the need for an occupation force of
40,000-60,000 troops, but the greater-than-anticipated resistance by Iraqi fighters
has forced an upward revision of estimates for both the size and duration of the
occupation. Recent statements indicate that the current force of some 150,000
troops is likely to remain in place at least until fiscal 2004.
Looking to the UN
Facing a financial commitment it cannot afford as the country’s budget deficit
continues to grow by leaps and bounds, the Bush administration has
energetically sought assistance, in terms of both manpower and money, from the
international community. That strategy has placed the government in the rather
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awkward position of requesting help from the UN, which some top officials in
the administration, notably Secretary of Defense Donald Rumsfeld, had all but
dismissed as irrelevant back in March, when the UN Security Council refused to
give the US and the UK its blessing to invade Iraq.
In late August, Deputy Secretary of State Richard Armitage announced that the
US was open to the creation of a UN-sponsored multinational force under US
command, a move aimed at convincing reluctant potential allies to contribute
troops to the reconstruction effort. Anticipating likely resistance from key
members of the Security Council, notably France and Russia, officials also
indicated that they would be willing to draw up a concrete timetable for the
transition to rule by a democratically elected Iraqi regime.
In a television interview in early September, Republican Senator John McCain
called the administration’s request for help “a tacit admission that we don’t have
the forces there to get the job done,” and warned, “If we don’t turn things
around in the next few months, we are facing a very serious long-term problem.”
Such considerations will not be lost on France and Russia, which will no doubt
use their leverage to wrest as much as they can from the US. Along with a voice
in shaping the post-Saddam regime, they will no doubt be looking for access to
potentially lucrative investment contracts that have so far been the private
domain of companies with close connections to the Bush administration.
Internal Conflict
Beyond the problems they are encountering in their efforts to lay the foundation
for a friendly, democratic regime in Iraq, administration officials have run into a
hail of criticism over alleged falsehoods in the arguments they put forward to
justify going into Iraq in the first place.
The key reasons presented by the Bush administration to support its policy of
regime change in Baghdad were claims that Iraq was aggressively pursuing
development of weapons of mass destructions (WMD) and that Saddam
Hussein’s regime had ties to Osama bin Laden’s al-Qaida terrorist network. In
the four months since Bush declared effective victory in Iraq, investigators have
failed to turn up a shred of evidence to support either allegation.
The flap erupted over a statement made by the president during his State of the
Union address in January 2003, in which he quoted British intelligence sources
as indicating that Saddam Hussein’s government had attempted to obtain
quantities of uranium from the African nation of Niger. It has since come to
light that the source of the information was dismissed as fraudulent by US
intelligence personnel no later than November 2002. The crux of the
controversy involves who knew that and when they knew it.
Joseph Wilson, a former ambassador to Gabon who was dispatched by the CIA
to investigate the uranium claims in February 2002, stated in a television
interview in early July that it did not take long to conclude that the reported
transaction had never taken place, and that his doubts about the truth of the
claims had reached the office of Vice President Dick Cheney.
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On that basis, Wilson stated, “Either the administration has some information
that it has not shared with the public, or, yes, they were using the selective use of
facts and intelligence to bolster a decision in a case that had already been made,
a decision that had been made to go to war.”
Wilson’s charges were corroborated by Gregory Thielmann, a former official
with the State Department’s Bureau of Intelligence, who had access to the
classified documents used to make the administration’s case for war. In a July
press conference, Thielmann stated his opinion bluntly, declaring, “I believe the
Bush administration did not provide an accurate picture to the American people
of the military threat posed by Iraq.”
Congressmen from both parties, some under pressure from constituents,
demanded investigations into both the accuracy of US intelligence on Iraq’s
possession of WMD and whether that intelligence was manipulated by the
administration to bolster its case for war. In early June, the Senate announced
that both the Intelligence and Armed Services committees would hold hearings
after the summer recess that began in August. The House Intelligence
Committee also plans to schedule hearings on the issue.
For its part, the Bush administration has admitted that the information about the
attempt to purchase uranium from Niger was of questionable veracity, but the
president and his top officials insist that they were not aware of the CIA’s doubts
about the information when Bush delivered the State of the Union address. The
Bush administration put the matter to rest (to its satisfaction, anyway) when CIA
Director George Tenet publicly accepted blame for not flagging the statement
during his review of the speech.
On one level, the controversy is insignificant in terms of voter perceptions. A
poll conducted in late July showed that 47% of respondents believed that the
government had exaggerated the extent of Iraq’s program of weapons of mass
destruction (WMD) and Iraqi regimes links to Osama bin Laden’s al-Qaida
terrorist network. Even so, fully 69% of those surveyed believed that the war
was justified.
However, the Democrats are not about to let matters stand there, especially as
the controversy has provided an opening for broader criticism of the Bush
administration’s handling of the war, and pointed to a potential point of
weakness in the area of foreign policy, the president’s strongest front.
Opposition Ammunition
In fact, the furor over the questionable intelligence data has been a godsend for
Democratic presidential hopefuls such as Senator John Kerry and Senator Joseph
Lieberman, both of whom voted in September 2002 to authorize the use force
against Iraq. That left them in a difficult position when Howard Dean, the
former governor of Vermont, built a commanding lead in polls of Democratic
voters by making opposition to the war a central plank of his campaign platform.
In early July, Kerry called on President Bush to “tell the truth” about Iraq,
implicitly disavowing his own vote in favor of war on the grounds that he had
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September 2003
been lied to. Kerry attempted to link the controversy over the suspect
intelligence data with the administration’s overall record in Iraq, demanding that
Bush admit that “the war is continuing and so are the casualties” and that “we
lack sufficient forces to do the job of reconstruction in Iraq” and need more help
from allies.
To a degree, Bush has made such an admission in seeking assistance from the
UN. As to whether that will damage his hopes for re-election, it is still far too
early too tell.
On the one hand, should continuing investigations turn up concrete evidence of
an Iraqi WMD program, the issue will cease to have relevance. On the other
hand, in the absence of such a development, should congressional inquiries
indicate that president or any of his closest advisors deliberately manipulated
data to justify a costly war of questionable necessity, Bush’s re-election hopes
could be significantly deflated.
ECONOMY
Of course, the Democrats will have virtually no hope of defeating Bush if the
economy shows clear signs of recovery by the time of the election. The key
phrase here is “clear signs,” meaning that all of the positive data in the world
will matter little if the situation continues to feel like a recession to the average
American.
This is a hard lesson that Bush’s father learned in 1992, when he lost his own reelection bid to Bill Clinton as the economy was undergoing a “jobless” recovery.
In that regard, the economic news has been mixed for the Bush administration.
Although Federal Reserve Board Chairman Alan Greenspan has declared that the
economic is poised for a “fairly marked turnaround,” and the danger of deflation
appears to have evaporated (thanks in large part to continued high fuel prices),
many economists have become much more reserved in their forecasts, predicting
both a later and less robust recovery that previously anticipated.
In a positive vein, the index of leading economic indicators rose for a third
consecutive month in June, leading analysts to confidently assert that the worst
was over. Official economic figures released in late July revealed that the
economy expanded by 2.4% in the April-June quarter, well above the expected
1.5% and a significant improvement on the previous quarter, when real GDP
growth registered just 1.4%. Second quarter statistics also indicated that
businesses are spending more on investment and depletion of inventories points
to sustained business spending throughout the remainder of the year.
Meanwhile, the manufacturing index rose from 49.8 in June to 51.8 in July,
indicating an expansion of manufacturing activity for the first time since
February. The general improvement in the economy was also reflected in more
favorable financial reports from major US firms in such diverse industries as
telecommunications, chemicals, and pharmaceuticals, which helped to push up
stock prices on Wall Street.
38
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International Country Risk Guide
September 2003
Socioeconomic Conditions
But one indicator of particular significance to the voting public-and, for that
reason, to politicians-is unemployment, and there the news has not been so
favorable. The unemployment rate rose to a nine-year high of 6.4% in June,
before easing to 6.2% in July. However, according to many analysts, much of
the improvement reflected some 500,000 discouraged job seekers who left the
labor market.
The unemployment figures have served to undermine consumer confidence, a
critically important factor, as consumer spending accounts for as much as twothirds of economic growth. The consumer confidence index fell to 87.2 in June
from 92.1 in May, the first decline since March and the largest monthly decline
in 2003. In July, the index rose to 90.1 and jobless claims fell below the 400,000
level that is taken as an indicator of a weak job market.
However, analysts have warned that even if the economy should begin to show
strong signs of recovery later in the year, the rate of job growth will not be
sufficient to absorb new entrants into the job market, and the unemployment rate
will remain uncomfortably high as political campaigning begins in earnest.
Another factor that will likely cause concerns for Bush’s re-election team is the
prospect of a sharp rise in prices for natural gas. In early June, Fed Chairman
Greenspan singled out high gas prices, which have doubled since 2002, pose a
very real threat to an economic recovery. Rising demand for natural gas has
outstripped supply, including imports, and shortages have begun to affect the
productivity of some manufacturing firms.
Under the circumstances, a particularly cold winter could result in an energy
crisis. Few new domestic sources are being explored, at least in part due to
environmental concerns, and investment in the construction of liquefied natural
gas (LNG) terminals has not kept up with current needs. If forecasts of higher
natural gas prices this winter (some estimates suggest that prices could be as
much as 19% higher) prove accurate, that development would impact both
manufacturing activity and consumer spending, seriously dampening hopes for a
strong economic recovery.
*
*
*
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39
International Country Risk Guide
September 2003
URUGUAY
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
71.5
26.5
25.0
61.5
Mod.
Current
09/03
70.5
30.5
28.0
64.5
Mod.
One Year
Ahead
Worst Best
Case
Case
65.0
76.0
22.0
28.0
27.0
31.0
57.0
67.5
High
Mod.
Five Years
Ahead
Worst Best
Case
Case
65.0
77.0
25.0
32.0
26.0
38.0
58.0
73.5
High
Low
POLITICS
Economy Minister Resigns
President Jorge Batlle dropped something of a bombshell on August 19,
announcing that Alejandro Atchugarry, his economy minister and loyal ally, had
resigned from his post. The president immediately named Isaac Alfie, a US
trained economist who had served as a close aide to Atchugarry, to fill the vacant
post.
A Job Well Done
Atchugarry, who assumed his post in late July 2002, played a key role in helping
the government weather the economic crisis that engulfed the country beginning
in mid-2002. The origins of that crisis lay in neighboring Argentina, where an
economic meltdown contributed to a collapse of cross-border trade. A sharp
drop in export revenues created tremendous pressure on Uruguay's hard currency
reserves, touching off a run on private deposits that provoked the closure of the
country’s banks and forced the central bank to abandon its managed float of the
currency.
An emergency loan package from the IMF and other multilateral lenders
prevented a complete collapse, but the economy contracted by 10.8%, year-end
inflation rose above 25%, and the sharp slide of the currency significantly
increased the foreign debt burden, raising concerns about the possibility of a
default.
In May 2003, Atchugarry supervised a successful restructuring of $5.4 billion in
private debt to bondholders (including $3.3 billion issued overseas). By the
closing date of the debt swap offer on May 21, more than 90% of investors
holding bonds scheduled to mature over the next nine years had agreed to a
voluntary extension of maturities by five years at existing interest rates, and the
government announced plans to go ahead with the swap on May 29. The
arrangement figures to cut the government’s immediate debt obligations by an
estimated 15%.
More recently, Atchugarry reached a new agreement with the IMF in June that
lowered the target for the primary fiscal surplus to 3% of GDP (from 3.2%),
while also revising the 2003 forecast for year-end inflation downward from 27%
to 19% and reducing the forecast contraction of the economy to 1% from 2%.
40
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International Country Risk Guide
September 2003
IMF Praise
In July, the IMF pointed to several positive signs indicating that the worst was
over for Uruguay. According to officials from the Fund, the economy registered
real GDP growth of 0.5% (quarter-on-quarter, seasonally adjusted) amid
indications of stronger growth moving ahead, led by an improvement in exports.
The IMF also noted that private sector bank deposits had nearly recovered to the
levels in July 2002, when a bank holiday was declared, and that gross official
reserves had more than doubled since March 2003, to $1 billion, sufficient for
about six months of import coverage.
Against that backdrop, Atchugarry attempted to put a positive spin on his
resignation, stating, “A political time comes to an end, and a technical time
begins,” implying that the return of some semblance of stability had left the
Economy Ministry more in need of a technocrat than a power broker. He added
that he had expected from the start to bow out once economic stability had been
restored.
Internal Conflict
Reassuring though those sentiments might be, the truth is that Atchugarry’s
departure did not take place in an atmosphere of unmitigated optimism. In fact,
the government will be hard-pressed to achieve the agreed-upon fiscal target
without the cooperation of both the legislative opposition and organized labor,
and Atchugarry’s final month in office featured rough going on both fronts.
In July, he failed to win majority support for a tax package that includes an
extension of VAT coverage and the expansion of the income tax base, after the
National Party (Blancos) insisted that tax cuts be included. Moreover,
Uruguayan workers, who have seen their purchasing power cut by 25% owing to
currency depreciation, are more inclined to demand wage increases than to
endure belt-tightening and an expansion of tax coverage.
In June, the powerful Inter-Trade Unions Workers Plenary-National Workers
Convention (PIT-CNT) labor federation organized a 24-hour general strike to
protest the government’s economic policies and to demand higher wages.
According to officials from the PIT-CNT, the action drew the support of as much
as 80% of the work force nationwide. A repeat performance appeared to be on
the cards for late August, after the PIT-CNT voted by a two-to-one margin early
in the month to stage another general strike on August 28.
Meanwhile, 4,200 public health doctors initiated a 96-hour strike on August 11,
at the same time that 15,000 Health Ministry employees began a walkout of
indefinite duration. While the health workers union bemoaned a “profound
crisis” in the public health system that is depriving Uruguayans of adequate
health care, the issue at the center of the strike is wages.
Clearly, the “political” component of efforts to repair the country’s financial and
economic damage is far from over, but Atchugarry’s ineffectual attempts to
persuade either the legislative opposition or the unions to willingly accept his
harsh fiscal medicine indicated that he had outlasted his usefulness. He
apparently reinforced that feeling when, during a press interview held shortly
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41
International Country Risk Guide
September 2003
before he stepped down, Atchugarry bluntly stated that “the financial crisis is far
from over,” a pronouncement that set off alarm bells within the business
community.
He sought to deflect criticism by accusing the press of
misinterpreting his remarks, but to no avail.
Outlook
Alfie has pledged to remain true to the policies of his predecessor, declaring,
“The course will be maintained.” However, as noted, that course had placed
Atchugarry in direct conflict with both the legislature and organized labor, and
there is little reason to expect that Alfie will prove any more adept at making his
way through the political minefield he must cross before there can be any hope
of fulfilling the IMF’s conditions and restoring the long-term health of the
economy.
In dealing with the legislature, the Blancos will be the least of Alfie’s worries.
The center-left Progressive Encounter-Broad Front (EP-FA) bloc, which holds
40 seats in the Chamber of Deputies, is intent on exploiting the Batlle
government’s vulnerability to boost its chances of gaining power following the
elections scheduled for October 2004.
The EP-FA has already succeeded in forcing the government to hold a
referendum on a controversial bill that permits ANCAP, the state-owned oil
monopoly, to enter into association agreements with foreign firms. The vote is
scheduled for December 2003.
The government’s efforts to privatize public services and state-owned energy
companies have met with consistent public opposition, and the legislation
permitting association agreements was pursued as a compromise measure.
However, the EP-FA maintains that rather than being a halfway measure, the
new legislation in reality reflects an attempt to privatize the company through the
back door.
Marina Arismendi, an EP-FA senator and the secretary-general of the
Communist Party of Uruguay, explained the purpose of the referendum, stating,
“We are fighting…to stop ANCAP’s covert privatization, as its refinery pumps
enough oil to feed the internal market and even export the surplus.” On the
prospects for success in the referendum, she added, “As the company has been
built up thanks to local taxpayers, we are sure the citizens will vote against
privatization.”
Arismendi is probably correct, although recent polls indicate that the percentage
of voters intending to vote against the bill is somewhat less than the 50%
required to quash the legislation. In an effort to crystallize the issues in the
public mind, and thereby swell the ranks of the “no” camp, opposition leader
Tabaré Ramon Vázquez Rosas challenged President Batlle in July to debate him
on the issue.
Not surprisingly, Batlle declined, stating, “I believe that ANCAP's issues are
much more important than public debates. The main discussion is whether our
country wants to be part of the world or not.”
42
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International Country Risk Guide
September 2003
EUROPE
(EUROPEAN UNION)
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43
International Country Risk Guide
September 2003
CURRENT RISK ASSESSMENTS AND FORECASTS
COUNTRY
Austria
Belgium
Denmark*
Finland
France
Germany
Greece
Ireland
Italy
Luxembourg
Netherlands
Portugal
Spain
Sweden*
United Kingdom*
CURRENT RATINGS
Political
Financial Economic
Risk
Risk
Risk
09/03
09/03
09/03
90.0
42.0
40.0
86.5
41.5
42.5
87.5
42.0
42.0
93.5
36.0
44.0
78.0
40.0
40.0
83.0
41.5
39.0
78.0
36.5
37.5
92.0
41.5
41.0
78.0
43.0
39.0
94.5
43.0
44.5
90.5
39.5
41.0
86.0
36.5
34.5
82.0
39.0
39.0
90.5
40.0
43.0
86.0
42.5
39.0
Year
Ago
10/02
86.0
84.5
87.8
89.5
82.0
83.5
74.8
89.0
80.5
91.3
85.5
79.3
80.8
84.0
82.5
COMPOSITE RATINGS
Current
Forecasts
Rating
One Year
Five Year
09/03
WC
BC
WC
BC
86.0
79.5
88.0
78.5
92.5
85.3
78.5
85.5
75.5
89.0
85.8
83.0
86.5
77.5
90.0
86.8
79.0
89.5
75.5
89.5
79.0
78.0
85.5
75.0
90.0
81.8
78.0
83.8
75.0
91.0
76.0
73.5
80.0
72.5
85.0
87.3
80.5
89.5
76.0
91.0
80.0
73.5
81.0
71.0
84.5
91.0
89.0
91.5
83.0
91.5
85.5
82.0
88.0
80.5
88.5
78.5
73.0
80.5
70.0
83.5
80.0
74.5
83.5
74.5
89.0
86.8
81.0
86.0
73.5
88.0
83.8
77.5
85.5
76.5
89.0
*-Non-euro Countries
For historical risk ratings and key economic data on these and other countries in ICRG, please go to
www.CountryData.com.
44
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International Country Risk Guide
September 2003
BELGIUM
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
86.5
39.5
43.0
84.5
V.Low
Current
09/03
86.5
41.5
42.5
85.3
V.Low
One Year
Ahead
Worst
Best
Case
Case
79.0
87.0
38.0
40.0
40.0
44.0
78.5
85.5
Low
V.Low
Five Years
Ahead
Worst
Best
Case
Case
75.0
90.0
38.0
42.0
38.0
46.0
75.5
89.0
Low
V.Low
POLITICS
Government Stability
New Government Formed
After some 50 days of protracted negotiations a new government, nicknamed
“Verhofstadt II,” was eventually ratified on July 16. A vote of confidence in the
new 'Purple' socialist/free-market liberal five-party coalition led by the
reappointed Flemish Liberal-Democratic (VLD) Prime Minister Guy Verhofstadt
was passed in the Chamber of Representative (lower house of the bicameral
Federal Parliament) by 96 votes in favor and 49 against.
The multi-dimensional structure of Belgian politics, underpinned by a close cooperation between the federal government, regional governments, employers and
other stakeholders, was described, along with the results of the parliamentary
elections held on May 18, in ICRG No 6, 2003.
As expected at that time, the new government has been formed of the socialist
parties and the right-of-center liberals from both the Flemish and Francophone
cultural-linguistic groupings. On the left, these are: the alliance between the
Flemish Social Progressive Alternative (SP.A) and SPIRIT (an acronym for the
Flemish “Social, Progressive, International, Regional Integrally-Democratic and
Future-Oriented” party) and the French-speaking Socialist Party (PS). These
three parties together hold 49 of the 150 seats in the lower house.
They are joined form the right by the francophone Reform Movement (MR) and
the Flemish Liberal Democrats (VLD), which together hold 48 seats. The
combined holding of the five coalition parties totals 97 seats, giving the
government a majority of 44.
Chamber of Representatives (Lower House )
Total Lower House Seats
Government Parties
Flemish Liberal Democrats
Socialist Party
Social Progressive Alternative-SPIRIT *
Reform Movement *
Total Government Seats
§
VLD
PS
SP.A-SPI
MR
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Fl
Fr
Fl
Fr
Seats
150
25
25
23
24
97
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International Country Risk Guide
September 2003
Chamber of Representatives (Lower House )
Opposition Parties
Christian Democratic & Flemish Party *
Vlaams Blok
Humanist Democratic Center*
Ecolo
New Flemish Alliance *
National Front
Total Opposition Seats
§
CD&V
VB
CDH
NVA
FN
Government Majority
Fl
Fl
Fr
Fr
Fl
Fr
Seats
21
18
8
4
1
1
53
44
Note: In the column headed §, Fr denotes Francophone parties, Fl denotes Flemish
speakers; * indicates a renamed or new party or alliance.
New Cabinet
The coalition compact was announced on July 8 after 14 hours of all-night
haggling. Soon after all five party congresses sealed the deal, and on July 14 the
new government was sworn in by King Albert II.
Most notable among the new executive was Belgium's first black minister, Anita
Temsamani of the SPA, who is of North African descent. She will deputize for
Minister for Labor and Pensions Frank Vandenbrucke, and have her own brief as
Secretary of State for the organization of work and well-being at work.
Among the key ministerial appointments, announced on July 14, are the retention
of political heavyweight Louis Michel as foreign minister, Didier Reynders at
Finance and André Flahaut as minister of defense.
The unfortunate Louis Michel has attracted internal and external criticism of
ineptitude as the 'genocide law' scenario unfolded (see External Conflict, below).
On top of that Michel, who enjoys his epicurean delights (see ICRG Nos 6 and
12, 2002), has suffered further health setbacks: during the coalition-building
negotiations on June 29-30 he was hospitalized again with stomach pains. It has
also been said that he has been suffering from fatigue.
46
Office
Prime Minister
Office Holder
Guy Verhofstadt
Party
VLD
Deputy Prime Ministers:
Justice
Foreign Affairs
Budget and Public Enterprises
Home Department
Mrs Laurette Onkelinx
Louis Michel
Johan Vande Lanotte
Patrick Dewael
PS
PRL
SP.A
Ministers:
Employment
Defense
Development Cooperation
Finance
Frank Vandenbroucke
André Flahaut
Mark Verwilghen
Didier Reynders
SP.A
PS
VLD
MR
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International Country Risk Guide
Office
Social Affairs & Public Health
Economy, Energy, Foreign Trade
and Scientific Research
Mobility and Social Economy
Civil Service, Social Integration
and Larger Towns Policy
Self-Employed and Agriculture
Environment, Consumer Affairs
and Sustainable Development
September 2003
Office Holder
Rudy Demotte
Mrs Fientje Moerman
Party
Bert Anciaux
Mrs Maria Arena
Ms Sabine Laruelle
Ms Freya Van Den Bossche
In addition to the deputy prime ministers and ministers there are six secretaries
of state.
Legislative Program
Verhofstadt was quick off the mark to announce the hard-won legislative
program approved by his coalition partners before parliament took its summer
break. With concessions to both the socialist and center-right interests, the key
proposals include:
•
•
•
•
•
•
•
Reforms of the judicial system;
Further tax reforms (see Economics, below);
Refinancing of health care with increased funding of between 4% and
5%;
Environmental commitments, including honoring Belgium's obligations
under the Kyoto Protocol;
Tightening of security;
Cuts in bureaucracy and corporate costs and combating social security
fraud;
The creation of an extra 200,000 jobs (in a nation with a population of
some 10 million).
This last point is critical to Verhofstadt. In his inaugural speech on July 14, he
said, “Labor will be the central issue of the current [government] agreement."
With one of the highest unemployment rates and lowest productivity rates in
Europe, he is right to be concerned.
Tax Policy
Among the economic measures announced by the new government is a hike in
excise duties on fuel, coupled with higher levies, tempered by some tax
reductions, on energy and electricity. The fuel increases will neutralize recent
falls in price of diesel and gasoline, but they will be partly offset by the gradual
phasing-out of the duty on diesel automobiles by 2008.
Both domestic and commercial users alike will also benefit from reductions in
tax bills. The diesel duty will see a loss to government coffers of some €270
million ($302 million) annually, as well as the €83 million ($93 million) revenue
from abolishing the €62 (around $70) levy on new vehicle license plates.
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International Country Risk Guide
September 2003
The legacy of the Green parties' service in the previous coalition government has
not been ignored. Commenting on the environmental implications of the tax
cuts, Finance Minister Reynders said on July 14 that, along with tax breaks for
domestic energy-saving, the “four measures will cut taxes by almost €400
million (some $450 million) [and will] also be instrumental in achieving Kyotoimposed standards.”
Doubts
The government proposals sound fine, but some doubters point to the apparent
disparity between the longer-term objectives of the plan and the shorter-term,
political, objectives of the government. Under Belgian legislation both houses
are elected for a four-year term. Whilst some commentators have some
confidence in the new administration, others are concerned that Verhofstadt and
his coalition partners might be looking only as far ahead as the Flemish regional
and European elections slated for the summer of next year.
Others have noted that the coalition negotiations took the best part of two
months, and suggest that the protracted horse-trading indicated disparity in the
political, legislative, and economic demands of the eventual coalition partners.
This disparity, it is felt, could lead to a disintegration of the coalition before its
full course is run. On the other hand, others have pointed up Verhofstadt's
ability as a skilled administrator and peace-broker between warring factions (see
ICRG No 3, 2003).
External Conflict
Genocide Law
The long-drawn-out saga of Belgium's Law of Universal Competence of 1993,
known as the “genocide law,” has been a thorn in the side of government for
some time now (see ICRG No 6, 2003). On August 1, the law took a further
lurch towards total oblivion when the Senate (upper house) ratified a proposal to
restrict its implementation by 39 votes to four, with 20 abstentions.
The proposal had already been passed by the lower house on July 29 by 89 votes
to three. The two centrist Democratic parties, the francophone Human
Democratic Center (CDH) and the Christian Democratic and Flemish Party
(CD&V), abstained, as did the Flemish far-right Vlaams Blok (VB). The two
Green parties, Ecolo and Agalev, opposed the proposal outright.
The main provisions and implications of the reform are:
•
•
•
48
Only cases involving Belgians, or those who had lived in Belgium
for three years at the time of the alleged offense, can be prosecuted
or pursue claims;
Allegations against non-Belgians will no longer automatically
instigate formal investigation, and no there will be no right of appeal
against the decision of the public prosecutor whether to proceed or
not;
The recently-established International Court of Justice in The
Hague, Netherlands is a more suitable tribunal for such cases;
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International Country Risk Guide
•
September 2003
Full diplomatic immunity is guaranteed for government leaders and
other politicians when visiting Belgium.
Sighs of relief could be heard within Belgium and indeed in many nations
worldwide, despite concerns that the reform may not be sufficient to halt several
ongoing cases. Opposition Christian Democratic and Flemish Party (CD&V)
legislator Pieter Dee Crem criticized the reform, which Verhofstadt was keen to
push through parliament before the summer recess, as “bad legislation with a lot
of loopholes.”
He went on to complain: “The problem is not fixed. It is useless and senseless
because it's not applicable to solve the more important pending cases.” Official
sources are said to have confirmed that some 29 cases, including those cited
against Fidel Castro of Cuba and Palestinian leader Yasser Arafat, are still in
progress.
US Pressure
What is fervently hoped by all and sundry as the notorious law’s last gasp was
not, however, achieved solely by Belgian initiatives of good will. Charges
relating to the recent UK/US-led attack on Iraq had been lodged under the law
against, among others, US President George W Bush, US Defense Secretary
Donald H Rumsfeld, US General Tommy Franks, US Secretary of State Colin
Powell, and UK Prime Minister Tony Blair.
Belgian-US relations had already been strained by the Belgian condemnation of
the Iraqi situation. By June 12, not long after the latest charges against US
leaders were registered, Defense Secretary Rumsfeld had had enough. He
announced his doubts that Belgium “can currently be regarded as a hospitable
place” and felt that the genocide law (as it then stood) was “absurd.” Rumsfeld
added that Washington could withhold funding for the construction of NATO's
future headquarters in Belgium.
This, and the other ensuing condemnations, put Belgium's business community
into a panic about a prospective embargo and the loss of valuable trade contacts
with US firms. Coupled with those pressures, the Justice Ministry responded
within 24 hours of the charges against US and British leaders being laid that the
cases should be referred to the USA and to the UK in the light of the April
modifications to the law. These, which came into force on May 7, allow suits
that are considered to be “propaganda” or politically-motivated to be referred to
the domicile state of the defendants.
The costs of the threatened NATO pull-out were estimated in June at over
50,000 jobs and in excess of €5 billion ($5.62 billion), according to Belgian
English-language weekly newspaper The Bulletin. That was not all—US supply
aircraft for the troops in Iraq, which had thitherto called in at Belgium's Ostend
airport suddenly began refueling at Amsterdam's Schipol airport in the
neighboring Netherlands.
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International Country Risk Guide
September 2003
Foreign Minister Louis Michel was “a bit astonished” at the American reaction.
He wasn't, of course—he was squirming with embarrassment and knew the score
perfectly well. So he, Prime Minister Verhofstadt and their advisors straightway
got to work on a package of further reforms to the act which, ironically, has seen
a Flemish delegate issue a writ against Michel because he had authorized the sale
of Belgian arms to conflict-torn Nepal (see ICRG No 12, 2002). The writ was
dismissed on July 5.
By July 12, the day the new government was installed, the newly-reappointed
Prime Minister announced that its first major legislative initiative would be to
modify the law. “Changing the universal jurisdiction law is a priority of this
government,” he said. When asked about the view of US President Bush, he
replied, “He should no longer be concerned. Belgium, the site of international
institutions, has adopted the same law as other European countries.”
Despite these reassuring sentiments, Verhofstadt was clear in his denial that US
irritation had precipitated the changes. “No, the genocide law has not been
changed under American pressure…We are changing [it] only because there
have been so many abuses of it over the last few weeks,” he had said on June 22.
By sheer coincidence, the US resumed the Ostend refueling stopovers had been
resumed three days earlier.
Terror Scares
A number of packages containing toxic substances was sent to a range of
addressees in early June, resulting in the hospitalization of five police officers
and several civilians. An unnamed Iraqi national, aged 45, was promptly
arrested and charged with premeditated assault.
The ten letters, all seemingly posted in and around the town of Deinz, contained
a pesticide derivative phenarsazine, a rocket propellant, and hydrazine, an
arsenic product. They were intercepted or discovered between June 2 and 6
having been through the major sorting office at Ghent. Each envelope reportedly
contained a card container enclosing the toxins, and some are said to have
contained items linking the packs with the Islamic International Society, and
bore the message “Set our brothers free. Bastards.”
This message is believed to be related to the 23 Muslims alleged to belong to alQaida, who were put on trial in Belgium on May 22 on terror charges. Items
removed from one of the premises of one of the chief suspects in the trial are
said to include recipes for bombs, including the substances in the envelopes.
Among those to whom the packets were sent were:
•
•
•
•
•
50
Prime Minister Guy Verhofstadt;
The Court of Cassation (Belgium's highest court of appeal) in Brussels;
Antwerp Port Authority;
British, American and Saudi Arabian embassies;
Ostend airport;
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When items were collected from the house of the arrested suspect, police at
Brussels' judicial police headquarters were evacuated after five officers were
hospitalized with suspected symptoms of poisoning identical to those caused by
the packaged toxins.
United Nations
Belgium was put uncomfortably under the spotlight by a critical report from the
United Nations Committee against Torture, detailed by state broadcaster RTBF
Radio 1 on June 12. The report highlighted several areas of concern:
Prison system: prison inmates should be “granted a whole series of elementary
human rights.” An urgent scheme of modernization was needed, and an
independent external watchdog should be established.
Police: concerns were noted about an increase of police violence at public
demonstrations, and about the detention of minors and the elderly.
Status and treatment of aliens: the report was critical of the conditions under
which deportations were made, and the holding of immigrants in secure
centers.
The report had been compiled from April of this year using evidence from
various non-governmental agencies such as the International Prison Watch
Organization (Observatoire International des Prisons, OIP), the Human Rights
League (HRL), and the Movement against Racism, Anti-Semitism and
Xenophobia (MRAX). Commenting on the report's findings, HRL's Legal
Advisor Julien Pieret said, “The [UN] Convention on Torture is a convention
which contains a whole series of provisions, and Belgium does not in fact fully
respect all these provisions in a rather wide range of fields.”
He went on to note that some of the concerns had arisen over “degrading
treatment.” As an example, he explained that, “A demonstrator who is stripped
naked, searched, held for many hours without any possibility of informing
anybody, that's degrading treatment.”
Ethnic Tensions
Immigration Protest
Another unwelcome blaze of publicity put the government on the spot over the
summer when a group of around 350 Afghani refugees went on hunger strike in
the Church of the Sainte-Croix (Holy Cross), in Brussels on July24.
Their grievance was that of the 1,100 or so Afghanis who had applied for asylum
on the grounds that was still unsafe to return to their domicile, some two thirds
had had their requests denied the previous week by the Commissioner General
for Refugees, Pascal Smet.
Smet had ruled that only those who had applied before January 1, 2003, would
be allowed to remain until early next year, and those with children could stay till
the end of the academic year in 2004.
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Four days later some of the strikers began refusing water, and by July 29 six had
been hospitalized. The Red Cross, along with local residents’ groups and other
support agencies, were assisting those 200 or so still in the church and were
feeding the children, said to account for one third of the total and who were not
participating in the hunger strike.
The gesture caused much heated debate within the government alongside sharp
criticism from human rights organizations. But Verhofstadt was not to be
moved: “A hunger strike and organizing the occupation of a church is not
acceptable and … will not lead to results,” he told parliament on July 31.
But, of course, it will. After three mediators failed to resolve the situation,
Federal Ombudsman Pierre-Yves Monette was commissioned on August 10 to
attempt to broker a solution.
Human Trafficking
On a brighter note, 23 Albanians were imprisoned for terms of between three and
eight years on August 12 for people-trafficking offenses involving between
10,000 and 20,000 Iraqis and Albanians traveling on to the United Kingdom.
Speaking at a seminar run by the King Baudouin Foundation on August 1, Prime
Minister Verhofstadt said, “The Purple government intends to tighten and
enhance the efficiency of its actions against people trafficking.”
*
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*
*
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DENMARK
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
90.5
42.0
43.0
87.8
V.Low
Current
09/03
87.5
42.0
42.0
85.8
V.Low
One Year
Ahead
Worst
Best
Case
Case
88.0
91.0
37.0
39.0
41.0
43.0
83.0
86.5
V.Low V.Low
Five Years
Ahead
Worst
Best
Case
Case
85.0
96.0
35.0
40.0
35.0
44.0
77.5
90.0
Low
V.Low
POLITICS
Government Stability
The baleful influence of the far-right Danish People's Party (DF) on Prime
Minister Anders Fogh Rasmussen's two-party coalition government has gotten
tighter over recent months.
Fogh Rasmussen's conservative Liberal Party (Vp) and the Conservative People's
Party (KF) only hold 72 seats (56 and 16 respectively) in the 179-seat
unicameral parliament, so the government must rely on the DF's holding of 22
seats to obtain the majority required in order to pursue its legislative program.
Consequently, the DF has used this pressure to squeeze the government on its
favorite issue—immigrants and refugees (see Ethnic Tensions below).
Popular Support
But whilst the DF’s machinations have given the government a somewhat bumpy
summer, the Danish people seem generally happy with the present state of
affairs. An opinion poll by Green's Institute, and published in the financial daily
newspaper Borsen on August 8, showed the Vp with 30.2% support, and the
main opposition party, the Social Democrats (SD), in second place at 29.1%.
These levels compare with the 34.3% the Vp achieved in January (see ICRG No
3, 2003), and is a drop from Greens' earlier survey of June 12 when the Vp
scored 33.2%.
Support for the DF has returned to previous levels at 12.5% in the August poll,
up from 9.4% in the June poll, and even further up on the 9.1% showing in
January.
Further, Fogh Rasmussen can also find solace in the Greens' June poll, which put
his performance rating at 60% of those polled who thought his performance at
the helm was “good” or “very good.” whilst only 20% felt he had done “poorly”,
or “very poorly.” This level of approval was well in excess of the roughly 33%
apiece awarded to the other party leaders, namely government coalition partner
Bendt Bendtsen of the KF, Ms Pia Kjærsgaard (DF), Mogens Lykketoft (SD),
and Holger K Neilsen of the Socialist People's Party (SF).
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Ethnic Tensions
The xenophobic influence of the DF has been evident over the summer as the
debate about immigration and repatriation, unlike other matters of state, has
refused to take a vacation.
DF leader Pia Kjærsgaard, no doubt exhilarated by her party's recent climb in the
polls, said that repatriation of refugees had to be stepped up. “We have had a
number of discussions with the government about repatriation but our patience
in running out,” she told a party congress on August 8.
There were some 2,700 refugees in Denmark at the end of July whose
applications for residence have been declined, according to data from the Danish
police. Threatening to withhold support for the government's budget for next
year, Kjærsgaard complained that “despite what the Minister of Integration
[Bertel Haarder] claims, the government just has not been effective enough.”
Bringing in economics to support her rhetoric and adding an international
dimension to the situation, she added, “Unless he [Haarder] puts the
thumbscrews on governments that receive millions of krone in Danish aid, these
countries will continue to dictate to us how and whey they will accept their own
citizens.”
Making the threat to the government crystal clear, DF economics spokesperson
Kristian Thulessen Dahl warned, “It is difficult to imagine a budget being passed
without an agreement with us on future repatriation policy.” Referring to the
DF's successful bargaining for extra benefits for the elderly as part of a package
of tax reforms earlier this year, he added, “The tax issue proved that we are the
only party to deal with and we intend to utilize our influence.”
Haarder had earlier justified his government's efforts on June 19 when he told
the Parliamentary Finance Committee (PFC) that numbers of family
reunifications and asylum seekers coming to Denmark had halved, and that
“when fewer arrive it costs less.” He told the PFC that savings from the reduced
levels of immigrants could reach DKr400 million ($61 million),
Another concession to toleration was closed up on July 15 when the Danish
Immigration Service (DIS) withdrew the exemption allowing IT firms to recruit
foreign workers to meet skills gaps.
Criticism
But Denmark's stricter legislation has not gone uncriticized. Just one of many
critics, UNICEF, the United Nation’s fund for children, has said that current
proposals for restricting family reunions were in contravention of the UN's
Convention on Children, which stipulates that every child should be able to
remain with its parents till the age of 18. “Denmark has signed the convention,
so we should comply with it,” said UNICEF's Danish Director, Steen Andersen,
on June 17.
On August 8 the chairman of the National Association of Headmasters of
Teacher's Colleges, Nils-Georg Lundberg, called for more teachers from the
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immigrant community.
“Relative to the number of foreign-born students,
foreign teachers are clearly under-represented,” he said. Urging the government
to target recruitment into the profession at the immigrant community, he added,
“It would clearly be in everybody's interests to change this…I think we need to
reach out to the [immigrant] communities and the networks representing their
young people.”
Another expert, Christian Horst of the Teachers' College Institute for
Educational Anthropology, said of foreign teachers: “The Ministry of Education
could really make use of their expertise…We know we are going to need
teachers in the coming years, And that is yet another argument for focusing on
the problem.”
Further positive debate came on July 12 when a report from Catinét Research
Institute noted that a majority of immigrants are more satisfied with their life in
Denmark that was the case five years ago. No feelings of discrimination were
recorded by 66% of those surveyed.
Ålborg University's expert on immigration, Flemming Mikkelsen, pointed up that
the responses showed a disparity between the “reality of everyday life” for the
average immigrant, and the ongoing political debate on the matter.
External Conflict
Iraq
After much debate on the matter, Prime Minister Fogh Rasmussen has decided
not to hold an independent inquiry into the basis for Danish involvement in the
war in Iraq. Despite opposition calls, the premier announced on June 23: “I
cannot see that there is any basis for a study of what basis the war had in
international law.”
Further confidence about his position came on August 7 when he said that the
war was justified by the removal of Saddam Hussein from power. “You cannot
repeatedly ignore it when a dictator disregards the UN's warnings. There must
be consequences,” he said, following the line of the US and UK governments.
Denmark had been alone among the Nordic countries in supporting the war on
Iraq, despite parliamentary and public opposition. And its support has not only
been vocal. Some Danish 400 soldiers were dispatched to Iraq in late May and,
coming from radically cooler climes, found the temperature and other conditions
in Iraq very difficult, not least since they were among the first foreign troops to
enter Iraq after the overthrow of Saddam.
It was widely predicted that this level of support for the US-UK action would
push Denmark towards the front of the line for commercial involvement as the
rebuilding of Iraq progresses. This seemed to be confirmed when the allies
appointed Denmark’s ambassador to Syria, Ole Wøhlers Olsen to a supervisory
role in the reconstruction of the southern Iraqi city of Basra in April (see ICRG
No 6, 2003), effectively putting him in charge of one of the four administrative
regions established by the allies.
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The move did not go well, however. On June 23, a frustrated Olsen delivered
some stinging criticism of the US-led central command in Iraq, complaining
about lack of support from the Iraqi capital, Baghdad.
He commented, “My people in the administration office have no security guards
with them as they move around either—and I am not happy about that.” At the
same time he also stated that he did not intend to extend his contract as
administrator beyond the six-month period he begun in April.
But there was clearly more going on behind the scenes. On July 2, Olsen
resigned after only two-and-a-half months in office. Putting a gloss on the
situation, he said, “It is convenient now [to stand aside] when troops are being
replaced and other countries are taking over military tasks involving security,
law and order, and when the administration in Iraq is being reorganized.”
Some commentators have seen less chartable reasons for the move. Olsen was
immediately replaced by Britain's Sir Hillary Synnott, and will return to his
former post in Damascus.
European Union
The new Constitution of the European Union (EU), produced under the aegis of
former French president Valéry Giscard d'Estaing, is to be put to a plebiscite for
approval by the Danish people next year. After expressing his satisfaction with
the proposals to date, Prime Minister Fogh Rasmussen said on August 7, “This
will be the dominant topic over the next 12 to 18 months because we will have a
referendum on the new EU Constitution.”
It has not yet been made clear whether the referendum will solely involve the
Constitution, or whether voters will be able to decide about Denmark's four optouts from the EU's Maastricht Treaty. These are: the common EU defense
policy, judicial cooperation, economic union (membership of the euro, the
currency of 12 of the present 15 states), and European citizenship.
There are worries from a variety of quarters that the Constitution will result in a
loss of Danish sovereignty and the ceding of more control to Brussels. Referring
to the proposed European President and the rotation of 15 voting commissioners,
one voice from the business community cited only one of many such concerns.
“It is against the principle of equality that underwrites the EU, and that would
require a change in the Danish Constitution,” said EU Legal Adviser to the
European Association of Craft, Small and Medium-sized Enterprises, Peter
Vesterdof.
On the other hand, various polls over recent months have seen a rise in support
for Denmark to sign up to the euro. One poll, from Danske Bank and published
on August 3 in the Copenhagen Post, showed that support for monetary union
was almost two-thirds for, a significant about-turn from similar numbers against
when Denmark rejected the euro in a referendum in 2000.
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Law and Order
The Danish Maritime Authority (DMA) announced a tranche of new security
regulations for the country's numerous ferry operators on July 7. These include:
risk assessments, evaluating the dangers from terrorism, required from ferry
firms; and detailed plans for improving operators’ security arrangements.
The new provisions must be in place by July 1, 2004, and come as part of the
international “war on terror” and on the heels of a warning of potential bomb
attacks from Danish Police Intelligence (DPI) last November. The new rules
will mean that instead of lining up just before the ferry sails, cars and passengers
may be subjected to searches if the DPI deems it necessary.
Socioeconomic Conditions
Unemployment hit a five-year high in June at 6.2%, or 173,000 of the total
population of some 5.25 million, according to figures from Statistics Denmark
(SD) published on July 7. This represented a rise from the 6% recorded in May.
Attributing the rise to global economic slowdown, SD pointed up that the level
of some 5% unemployment early in 2001 was also something of a record - one of
the lowest levels for over two decades.
ECONOMY
Liberalization
The privatization of two radio stations FM5 and FM6 (see ICRG No 6, 2003)
was completed on June 19, with the final offers well above the government’s and
private analysts' expectations. Rupert Murdoch's Sky Radio bought FM5 for
DKr54 million ($8.2 million), pipping favorite bidders TV2's offer of DKr50
million ($7.6 million). Talpa Radio International acquired FM6 for rather less at
KDr22.5 million ($3.4 million).
Public Expenditure
A warning about levels of government spending came from Statistics Denmark
(SD) on July 10 when it emerged that public expenditure had risen by 0.4
percentage points in the first quarter of 2003. Extrapolated for the whole year,
that would give a rise of 1.4%, exactly twice the budgeted amount.
Concerns were quickly voiced. “There has been a gradual tendency for spending
to rise more than planned, so if the government is going to reach its goal, it's
going to take real political action,” said Steen Bocian, an analyst from Danske
Bank.
Economic Growth
But as the second wealthiest nation in Europe, Denmark has weathered recent
financial and economic problems better than many other EU states. GDP growth
was 2.1% in 2002. Although some private commentators predict a drop to 1.2%
this year after a decline in domestic demand during the first quarter of 2003, the
expectation is that former levels will quickly be resumed, with a growth of 2.1%
again expected for 2004.
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FINLAND
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
95.0
39.0
45.0
89.5
V.Low
Current
09/03
93.5
36.0
44.0
86.8
V.Low
One Year
Ahead
Worst
Best
Case
Case
85.0
94.0
34.0
39.0
39.0
46.0
79.0
89.5
Low
V.Low
Five Years
Ahead
Worst
Best
Case
Case
83.0
95.0
33.0
40.0
35.0
44.0
75.5
89.5
Low
V.Low
POLITICS
Government Stability
Politics in Finland have long been a quiet, workmanlike and sedate affair; some
would even say dull. On the other hand, recent economic success and stability in
Finland bear witness to a long-honored prevailing ethos of cooperation and
consensus. Furthermore, Finland has in the past several years scored near or at
the top of the league of the least corrupt nations in the world.
Prime Minister Resigns
So it was with some surprise all round that the 63-day reign of new Center Party
(KESK) Prime Minister Anneli Jäätteenmäki came to an abrupt and messy end
on June 18 when she resigned as the result of mounting pressures from a scandal
involving leaked documents concerning relations with the USA in the run-up to
the invasion of Iraq.
But the brief spell of political Scandinavian midsummer madness soon
evaporated as order was swiftly restored. Within a few days, the leaders of the
three parties in the government coalition agreed on the then defense minister,
Matti Vanhanen, as the new prime minister. On June 24, parliament confirmed
him in the post by 109 votes to 67, and the new government, led by Vanhanen,
presented itself to the President.
Ms Jäätteenmäki, still confident that she would be found innocent of the charges
laid against her, nevertheless apologized to President Halonen and thanked her
for her personal support. At the same time she resigned as leader of KESK.
The three-party 'red soil' coalition government, is formed of the moderate Center
Party (KESK), which has a rural, agrarian tradition, the small and liberal
Swedish People's Party in Finland (SFP), which represents the Swedish-speaking
minority of the population, and the left-of-center Social Democratic Party of
Finland (SDP).
Apart from the change at the top, personnel and policies (see ICRG No 6, 2003)
are the same as before the debacle.
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Paper Waving
The drama began to unfold during the campaign leading up to the general
election of March 16. During a televised debate on March 6, between the then
SDP Prime Minister Paavo Lipponen and KESK party leader Jäätteenmäki, the
challenger attacked Lipponen on his positive pro-US stance during the build-up
to the invasion of Iraq.
Accusing him of abandoning the traditional Nordic neutrality, she was seen
brandishing a sheaf of papers—confidential documents—which were said to
have involved Lipponen in secretive dealings with the US.
Ten days later Jäätteenmäki romped to victory, unseating Prime Minister
Lipponen by a narrow margin (see ICRG No 6, 2003).
Press Revelations
The waving documents caught the eyes of reporters; or their eyes were drawn to
them by someone not a million miles away from the former prime minister’s
office. Either way, on May 9 the commercial television channel MTV3 broke a
news story alleging that Jäätteenmäki had used leaked secret memos of a
discussion between Prime Minister Lipponen and US President George W Bush,
and of a briefing in the USA by State Undersecretary Marc Grossman.
Both documents were said to relate to Finland's—or Lipponen's—stance on
actively aligning with the anti-Saddam coalition. Excerpts from the reports were
subsequently published in the Finnish tabloid press.
Jäätteenmäki's Denials
On May 10, Jäätteenmäki denied that she had seen the two documents referred to
by the media, but the police had already launched an investigation into the
alleged leakage.
Despite parliamentary questions and accusations that she had used confidential
information to further her electoral campaign at the expense of Lipponen,
Jäätteenmäki denied yet again on June 6 that she had seen the papers.
She also said she had no knowledge of the source of the leak. But evening
tabloid newspaper, Ilta-Sanomat, claimed on June 6 to have seen notes of a
KESK meeting which allegedly confirmed that Jäätteenmäki did indeed have the
documents but would not reveal her source.
An internal KESK investigation began straightway, and Ms Jäätteenmäki was by
now being questioned by the police. Tempers rose, questions were asked in
parliament, and the other coalition parties, as well as many in her own KESK,
lost patience.
By mid-June the leak had been traced to a KESK aide, Martti Mannin who
worked in President Tarja Halonen’s office. Mannin was suspended, taken away
for questioning by the police, and his office sealed. On June 18 Jäätteenmäki
finally admitted to parliament that she had seen faxed excerpts of the documents,
but had not requested them.
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In the face of accusations of cover-ups, deceit, and illicit handling of confidential
documents, and with a frenzied media bun-fight enjoying every minute of the
whole affair, by now termed “Iraqgate,” there was only one option left for the
beleaguered Jäätteenmäki—her June 18 resignation.
So it was that on that day, June 18, she gave into the pressures and submitted her
resignation as prime minister. Finance Minister Antii Kalliomäki accompanied
the President to the Thessaloniki Summit that weekend in Jäätteenmäki's stead.
New Prime Minister
Prime Minister Vanhanen, 47 and, significant in Finland, a teetotaler, has
worked as a political scientist and as a journalist, and been in parliament since
1991. Said by some commentators to be dependable, intelligent but actually
rather dull, he is said to have much in common with his predecessor-but-one,
Paavo Lipponen, though he is of a similar age to Jäätteenmäki.
After the more engaging and outgoing style of Ms Jäätteenmäki, many have
welcomed the return of a more somber approach at the helm. Vanhanen is not
without ability, though: he is said by some to be something of an expert on
European matters, strategy, and economics. On top of that, he is well liked,
trusted, and respected within his party.
Vanhanen's portfolio at Defense has been taken up by the former Deputy
Speaker, KESK's Dr Seppo Kääriäinen, who has ministerial service with
previous administrations. A special KESK party conference on October 4 has
been convened to elect a new leader.
The Fallout
Fortunately parliament was dissolved for the summer recess shortly after the new
administration was in place—no doubt much to the relief of all concerned.
However, the police investigation is continuing; on August 7, Risto Volanen, a
secretary of state, was questioned by the police about his involvement with the
case.
So, it remains to be seen whether whole affair will blow over quietly during the
summer vacation and when life resumes in the fall, or whether the investigation
will uncover further revelations to discomfit KESK, or even the new
government.
Popular Support
The damage inflicted by Iraqgate on the Jäätteenmäki administration and KESK
generally was already evident in a Gallup opinion poll published on June 16.
This showed that the SDP had pushed KESK into second place in the approval
rankings, with 25.1% support, up from 22.9% at the March 16 general election.
KESK saw its level of support drop from 24.7% to 23.0%. The Green League,
which pulled out of the SDP-led coalition in 2002, saw its support jump by a
fifth, from 8% to 10%. There was little change in the support for the other
parties.
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As most Finns—even newspapers, pollsters and particularly politicians—
vacation during the month of July, no further surveys have been noted. More
telling indicators will no doubt come when Vanhanen gets into his stride as
parliamentary business resumes in the fall.
Socioeconomic Conditions
Population Concerns
Prime Minister Vanhanen might have been heeding the advice of the
International Monetary Fund (IMF) (see Economy, below) to expand the
workforce when he urged Finns to have more children and raise the birth-rate.
Vanhanen, himself the father of two young teenagers, also pointed up on August
10 the need for more immigration. “I am quite certain that in 20 to 30 years, we
will be more multicultural than today,” he said. His line in this difficult and
often vexed area contrasts sharply with that of its fellow Nordic nation Denmark
(see Denmark report in this issue).
The premier also noted that with the baby-boomer generation due to start retiring
after the present government's term of office, the number of those over 65 will
increase by over 50%, from 8.5 million now to 13.5 million in 2023.
As with most other European nations, pensions’ reform is an issue that needs
facing now, rather than leaving rapidly-ticking demographic time bomb for
subsequent administrations and future generations.
Alcohol and Tobacco Duty Cuts
Another move proposed by the prime minister to stimulate the economy was to
cut taxes on alcohol and tobacco by as much as 20%. Finland is one of the
highest-taxed nations in Europe and beyond, and the move was intended to
combat the flow of cheaper imports from neighboring states, such as Estonia and
Latvia, which are set to join the EU in 2004.
The announcement of tax cuts on alcohol came at the same time as the call to
produce more babies, which might say something about the Finnish libido.
Of course, the usual suspects were on hand to pour cold water on the impending
party. On August 8 Archbishop Jukka Paarma, of the (protestant) Evangelical
Lutheran Church of Finland, called for an “appeal to health reasons and people's
sense of responsibility instead of relying solely on legal or fiscal measures as the
means of alcohol policy.”
On the other hand, Finland has an impressive record of moderation with both
smoking and drinking. Along with Britain, Finland leads the world in reducing
smoking deaths, according to data from the UK's University of Oxford's
Professor Richard Peto who was speaking at the World Conference on Smoking
and Health at Helsinki on August 6.
A couple of days earlier, data from the World Health Organization (WHO) noted
that Finland had the lowest per-capita consumption of tobacco in Europe, with
only 16% of over-16s smoking.
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As for booze, a study from Statistics Finland published on June 17 showed that
only the Sedes drank less alcohol per head in the EU than the Finns during 2001,
consuming a mere five liters of 100% alcohol per head per year.
Accurate levels of consumption of tobacco and alcohol are notoriously difficult
to measure, but the fact remains that mortality, lung cancer and other similar
rates tend to confirm that the average Finns have a generally much healthier
lifestyle than many of their European counterparts.
Which leaves the sex.
Politicians’ Pay
Although the prime minister may be heeding the remarks by the IMF on the need
for public sector pay restraint, those who fix the levels of politicians’ salaries
were not. On August 5, an independent board recommended an increase of 9.4%
for parliamentary delegates, up €400 ($455) to €4,970 ($5,648) per month for the
basic rate, and €5,340 ($6,069) for longer-serving legislators. This year’s
inflation rate is targeted at about 1.2%.
The board argues that the above-inflation settlements are needed because
politicians have not had a pay rise since 2000. The rises are to take effect from
September. However, as they may wish to lead by example, the politicians do of
course have the opportunity to take less than the board's recommended
amounts…
Investment Climate
Nordic Money-Maker
Finland became a beneficiary of adjacent Norway's liberalization program on
June 30 when that country sold its National Mint to the Mint of Finland and
Norwegian coin specialists Samlerhurst. The deal raised NKr44 million (€5.3
million) for Norway. Finland has also owned the Swedish Royal Mint since
2001.
ECONOMY
Growth
The economy outperformed most European nations last year, coming in fourth
with a real GDP growth of 1.6%, trailing only Ireland, Greece, and Spain,
according to data from the EU's statistics arm, Eurostat. This shaped up well
against an average of 1% for the while EU, and 0.8% for the 12 eurozone states.
The economy had started sluggishly earlier this year, with unemployment still
stubbornly high at 9.4% during the spring. But signs of a revival came as
inflation eased from 1.6% in the spring to an expected 1.2% for the whole year,
according to preliminary data from the Ministry of Finance, published on July
30, just as preparations for the 2004 budget kicked off.
But the Ministry has cautiously revised its GDP growth forecast for 2003
downwards from 1.8% to 1.2%, and predicted a rally to 2.4% in 2004.
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IMF Assessment
The International Monetary Fund (IMF) also has some lukewarm predictions for
Finland when it issued a preliminary study of the economy in June. The report
approved Finland's recovery from the 1990s’ crisis, praising “private sector
initiative and solid macroeconomic management,” along with “excellent physical
and social infrastructure (including education) and a well-developed welfare
state.”
But there were caveats as well as commendations. Among the Fund's main
reservations were:
•
•
“High rate of unemployment [is an] indication of the need for further
reform efforts.”
“The Finnish population is ageing rapidly. The old-age dependency
ratio will rise to 40% in 2020 and 50% in 2030, almost double the
ratio today and among the highest in the EU during that time.”
These downside risks, along with “business investment weakness,” dropped the
Fund's GDP growth prediction for 2003 down to 1.3%, with a revival to 2.6% for
2004.
The Fund's prescriptions focused on labor market reform, together with other
suitable related initiatives. Its five point plan was as follows:
1. Raise the unemployment rate, by increasing work incentives for all
age and skill groups.
2. Cut taxes, notably on labor, as an important component of raising
employment, safeguarding competitiveness, and enhancing growth.
3. Establish and maintain a record of expenditure discipline, to make
room for credible tax cuts without compromising public finances.
4. Introduce further pension reforms to make a longer working life
more attractive.
5. Reform the product market to enhance the economy's efficiency and
generate employment.
Whilst Vanhanen has made a start on some of the items on this agenda, as noted
above, there is still clearly much for him and his government to do.
*
*
*
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ITALY
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
81.0
40.5
39.5
80.5
V.Low
Current
09/03
78.0
43.0
39.0
80.0
V.Low
One Year
Ahead
Worst
Best
Case
Case
73.0
78.0
38.0
43.0
36.0
41.0
73.5
81.0
Low
V.Low
Five Years
Ahead
Worst
Best
Case
Case
70.0
80.0
37.0
45.0
35.0
44.0
71.0
84.5
Low
V.Low
POLITICS
Government Stability
Prime Minster Silvio Berlusconi’s center-right coalition government is looking
increasingly fraught on a number of fronts. First, there are deepening
differences between the four coalition parties over a range of both long-term
issues and of recent events.
Second, whilst Berlusconi is holding the tiller at the head of the European Union
(EU) since Italy took on the rotating Presidency on July 1, many are concerned
that domestic issues, such as unemployment, structural reforms, and economic
boosts, will be sidelined to a greater extent than the scant attention they have
received since Berlusconi came to power in 2001.
Third, Italy's economy has “officially” moved into recession, with data from
Istat, the national statistics agency showing two successive quarters of negative
growth at 0.1% shrinkage between January and June this year. On top of that, a
report from the International Monetary Fund (IMF), published in July, noted that
“over the last decade [economic] growth in Italy has been slower than in any
euro-area country (except for Germany).”
Fourth, there is the multitude of allegations of sleaze, topped off by the
immunity legislation, which many feel was custom-crafted to enable Berlusconi
to evade due legal process.
Fifth, Berlusconi’s diplomatic ineptitude. Berlusconi’s unfortunate propensity to
speak before his brain is fully engaged is well known, and many commentators
were banking on him saying something stupid at some point during his
presidency of the European Union (EU). No one, though, thought he would do it
in his very first speech to the European parliament.
European Parliament Row
When Prime Minister Berlusconi began his address to the parliament on July 2
he was heckled by left-wing and Green members of the parliament (MEPs) about
the legal procedures put forward by his government to enable him to evade the
various trials against him and the apparent conflict of interest between his
political office and his extensive media interests. A group of ecologist
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September 2003
lawmakers held up placards in Italian declaring “La legge e uguale per tutti”
(The law is equal for all) and “No godfathers.” Berlusconi finally lost his cool
when a German Socialist MEP, Martin Schulz, questioned him about his media
interests.
Berlusconi responded: “Mr. Schulz, I know there is in Italy a man producing a
film on the Nazi concentration camps. I would like to suggest you for the role of
leader. You would be perfect.” The remark stunned the parliament. Schultz,
who could clearly teach Berlusconi a thing or too about reasoned debate, replied:
“My respect for the victims of fascism will not permit me to deal with that kind of
claim. But it is very hard for me accept that a politician should be exercising the
role of president of the European Council if he comes out with this kind of
statement when he encounters the slightest contradiction.”
European parliament President Pat Cox expressed regret at the offence caused to
Schulz and invited Berlusconi to apologize, saying it would be appropriate “to
correct the record in this regard.” Berlusconi refused, claiming that his words
were intended as an “ironic” joke.
Germany was mightily offended: Chancellor Gerhard Schröder demanded an
apology and cancelled a planned holiday in Italy. Italy eventually came up with
a grudging form of words that Germany was able to accept as an apology, while
Berlusconi continued to claim that it was not. The matter was finally resolved
on August 23 when Schröder met Berlusconi in Verona and the pair indulged in
some public handshaking.
Berlusconi’s taste in irony was widely condemned throughout Europe and in the
bulk of the Italian press. But not by Italian television broadcasters. The state
(RAI) television channels and the three private channels owned by the Mediaset
group, which cover about 90% of Italian TV broadcasting, criticized Schultz and
played down, or completely ignored, the international condemnation of
Berlusconi’s remarks. By pure happenstance Prime Minister Berlusconi owns
nearly 50% Mediaset and indirectly controls RAI through his government’s
majority in parliament. It was this potential conflict of interest that led to the
exchanges in the European parliament in the first place.
But Prime Minister Berlusconi is not without friends abroad. Outside of Europe,
President George W. Bush had nothing but praise for him. Recognizing
Berlusconi’s forceful, but exclusively rhetorical, support for the war against Iraq,
the US president received Berlusconi at his ranch in Texas on July 22, noting
that he was “pleased that Prime Minister Berlusconi is now serving as the
President [of the EU].
Democratic Accountability
Immunity Law
The prize of full immunity from prosecution that Berlusconi had proposed to his
government in April fell into his lap with surprising ease and exquisite timing,
coming into force less than 24 hours before Italy assumed the presidency of the
EU on July 1.
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Parliamentary immunity was abolished in the early 1990s after the “clean hands”
corruption trials which purged Italy's old political and business classes. Its
reintroduction, as proposed by Berlusconi, would provide immunity from
prosecution while in office for state's top five executives—the president, the
prime minister, the chief of the constitutional court, and the leaders of both
houses of parliament.
Given the drawn-out progress of much legislation in Italy, the Berlusconi’s legal
lifeboat moved through parliament with surprising speed: on June 4, the Senate
passed the draft legislation by 146 votes to 101, out of a total of 326 seats; on
June 18 the lower house followed suite, but with a massive 302 votes in favor
and only 17 against, out of a total of 630 seats; and on June 21 President Carlo
Azeglio Ciampi signed the approved draft into law.
The reason the draft passed so easily through the lower house was that many of
the opposition legislators felt it was better to have the law in place than risk a
constitutional crisis should the prime minister be convicted during Italy's sixmonth EU presidency. Consequently, although they could not bring themselves
to vote for it, they abstained. However, as the voting figures show, if the
opposition deputies had united against the draft they might have brought it down.
Corruption Trials
The new law brought an immediate suspension of the prime minister's own
corruption trial, in which he is accused of paying judges to decide in his favor in
a 1980s take-over battle for a state-owned food group SME, and raised the very
real prospect that it will never be resumed. Berlusconi’s current term is not due
to end until May 2006, by which time the statute of limitations would mean that
the case against him would have expired.
Berlusconi’s second, and last, appearance before the court in Milan on June 17
was a good deal less dramatic than his initial testimony on May 5 (see ICRG No
6, 2003). He spent only 70 minutes in front of his accusers. Pleading, again, the
pressures of his office, he invited the bench to continue their questioning in
Rome. The justices politely declined, and he was back at his premier's desk by
the afternoon.
So, Berlusconi has been spared from potentially sharing the fate of his codefendant Cesare Previti, a former lawyer, former Defense Minister, and
currently deputy of Berlusconi’s Forza Italia party. In April this year, Previti
was sentenced to 11 years imprisonment for bribery in a separate case (see ICRG
No 6, 2003).
The written judicial ruling on that case, published on August 6, accuses Previti
and the others convicted of choosing “the corruption of judicial decisions as a
true and proper life system, a method to obtain, as easily and also as sordidly as
possible, material wealth that clearly was never sufficient.” Of course,
Berlusconi was also a co-accused in the trial, but the case against him was
dropped under the statute of limitations.
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Berlusconi Bites Back
During his second court appearance on June 17, Berlusconi said: “In a court of
law one cannot say all the things that one might like to say.” However, he felt
no such inhibitions once he was outside the court, and quickly resumed his
attacks on the judiciary and claims of a left-wing vendetta and general
persecution. To back this up he complained that over the years he had been
subjected to harassment, including such actions as:
•
•
•
Over 500 visits to his firms "to seize documents."
The collection of information on his business dealings “from 50
Italian banks and 30 foreign lenders.”
The forcing of his executive to attend “more than 1,600 hearings
and 82 legal procedures.”
Defending his position, and demonstrating his literary skill, Berlusconi
paraphrased George Orwell's Animal Farm, noting that, “One citizen is equal to
another [under the law], but perhaps this one [Berlusconi] is slightly more equal
than the rest, given that 50% of Italians have given him the responsibility of
governing the country.”
Strange logic from a supposedly democratic leader.
Media Deregulation Law
On July 22, the Senate addressed the problem that provoked Prime Minister
Berlusconi’s “ironic” retort in the European parliament on July 2—his extensive
media interests. These include:
•
•
•
•
•
Publishing: Mondadori (over 50 magazines and around one-third of
the entire Italian book market)
Advertising sales: Publitalia
Telecoms: Albacom (a stake of some 20%)
Newspapers: daily broadsheet Il Giornale is controlled by
Berlusconi’s brother Paolo
Television: Terrestrial channels—Canale 5, Italia 1, Retequattro, and
La 7 (not a majority stake)
On top of this, in his capacity as prime minister and head of government he
effectively controls all the state broadcasting outlets too.
Whereas, the overwhelming majority of people in the EU at large, and not a few
in Italy itself, are of the view that this gives the prime minister a tad too much
control over Italy’s media, the Senate, in which the government parties have a
39-vote majority, clearly felt it was more than a tad too little. To set things
aright it passed what a media “deregulation” bill that, among other things, allows
Mediaset to:
•
•
keep all three free-to-air channels despite a ruling from the country's
highest court that one channel should go onto satellite transmission;
increase its advertising revenue to a maximum of 20% of the whole
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•
•
September 2003
advertising market, said to be worth some €25 billion ($27.6 billion);
integrate its broadcasting interests horizontally into the newspaper
business;
dispense with existing restrictions on lucrative promotional
activities.
The bill was passed—with over 4,000 amendments—against the advice of
President Ciampi, who was keen to retain some independence, impartiality, and
fair competition in the Italian media market.
Of course, the opposition members of parliament jumped up and down in
outrage, with one describing the bill as “A symbol of, and metaphor for, the
sickness of our democracy.” The Secretary of the Italian National Press
Federation felt it would be to “the detriment of RAI and the written press” and “a
license to kill off newspapers.”
A more dramatic protest came on the very night the bill got through the Senate
when Lucia Annunziata, head of RAI, announced her resignation. Berlusconi
has had difficulties with the management at RAI before, and the present RAI
board is to be abolished under the new bill. The Italian media, she said, were
“distorted by conflict of interest.”
As for Mediaset, its first-quarter sales were up by almost one-quarter to €777
million ($860 million), with a reported 11% rise in pre-tax profits to €191
million ($211 million).
Challenges to the Immunity Law
In a rebuttal to both the immunity law and Berlusconi’s interpretation of his
position in democratic Italy, the chief public prosecutor in Berlusconi’s trial, Ilda
Boccassini, said on June 25 that the new law “clearly and totally violates the
principle that everyone is equal in front of the law.” She was backed up by all
the prosecutors in the case, who agreed on June 30 to submit the law to the
constitutional court on the grounds that it is “unconstitutional” in that it violates
several fundamental principles, including equality among citizens.
The court is expected to take at least six months to reach its verdict on the
complaint, which would safely see Italy through its EU presidential term. What
happens thereafter is anybody’s guess, though on current form it is unlikely that
the court would overturn legislation that has secured convincing majorities in
both houses of parliament.
That does not mean Berlusconi’s opponents have given up. In particular, a
former public prosecutor, Antonio di Pietro is touring the country in an attempt
to collect 500,000 signatures for a petition which would force a referendum on
the immunity law. This is a tremendous task as all of the signatures have to be
presented by the end of September; failure to meet the deadline will mean the
end of the initiative.
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Such a campaign by a lone individual could be laughed off, but Pietro isn’t just
any old troublemaker. It was he who led the campaign against political
corruption that ultimately brought about the collapse of the Christian Democrat
and Socialist parties in 1992-93, and the transformation of Italy’s political scene.
The other risk for Berlusconi is the premature collapse of his government. It is
already looking shaky. If, through internal disagreement or pressure from the
opposition, one of the coalition parties should decide to quit well ahead of the
next general election—some time over the next 12 months for instance—
Berlusconi would lose his immunity by virtue of losing his office; and the trial
could be resumed.
That risk probably means that from now on Berlusconi will be taking extra
special care to keep his coalition partners sweet. It will be interesting to see
what that will mean for divisive issues within the coalition, like the north-south
divide and greater devolution.
Meanwhile, Berlusconi has gone onto the attack in an attempt to discredit the
prosecutors. On July 23 Ilda Boccassini and Gherardo Colombo, another
prosecutor in the SME trial, were placed under formal examination for alleged
“abuse of office”.
The complaint was raised by a previously unknown
association of lawyers, who allege that that the two prosecutors withheld a file of
papers, No. 9520/95, which could have helped the defense of Cesare Previti,
Berlusconi’s co-defendant in the SME trial.
Mediaset Scam
What looked suspiciously like another government fix took place the next day,
July 24, when Justice Minister Roberto Castelli blocked a probe into another
alleged scam, this time at Mediaset. The Milan prosecutors had requested
permission to seek information from the United States over allegations that
Berlusconi was involved in fraudulent deals to acquire television rights for US
films in 1994 and 1995 through two offshore firms. There are persistent rumors
that offshore subsidiaries were pivotal to massive tax fraud and false accounting
within Mediaset in the 1990s, with a loss to the Italian exchequer of some €80
million ($88.5 million).
Mediaset, owned by Berlusconi’s umbrella group, Finninvest, claims the
accusations are “groundless.” Whilst the Milan prosecutors have not yet said
much about the case, several leading foreigners are alleged to be involved,
including a UK lawyer, David Mills, whose wife is the British Minister of
Culture Theresa Jowell, alongside other Mediaset executives.
In rejecting the request, the Justice Ministry cited the immunity legislation
passed into law in June. However, as critics were quick to point out, the
legislation grants immunity only in the case of prosecutions and does not cover
investigations.
In a robust reaction, the Chief prosecutor in Milan, Armando Spataro, declared:
“We are at one of the most serious junctures in the war on the courts declared by
a section of the political classes which is in government …We are dealing with a
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minister [Castelli] who, ignorant of the letter and the meaning off the law, is
attempting to take the place of the judge.” The opposition parties immediately
launched a no-confidence motion against Castelli in parliament.
Coalition Unity
Justice Minister Castelli’s blatant misapplication of the immunity law over the
Mediaset investigation provoked another row within the government coalition.
The centrist Union of Christian Democrats (UDC), which has been at
loggerheads with both the post-Fascist National Alliance (AN) and the Northern
league (LN) threatened to leave the coalition unless the Mediaset investigation
was allowed to proceed.
The UDC’s departure would have meant the collapse of the coalition, a new
election, and the risk of Berlusconi losing the premiership, and his immunity.
So, just before the no-confidence vote on July 29, Deputy Prime Minister and
AN leader Gianfranco Fini announced in the Senate that the Mediaset
investigation would be approved. The UDC stayed with the coalition and the noconfidence motion against Castelli was defeated by 166 votes to 121.
However, Fini made it clear where the pressure for the U-turn had come from.
He told the Senate, “In order to stop this vulgar political exploitation and
delegitimization, it was the prime minister himself who said to go ahead with the
investigation.” It was clearly against Castelli’s wishes, who said after the vote:
“I did not reject an investigation; I simply asked for an evaluation...If I had
wanted to block such things, I could have done.”
The petulance of those remarks tends to underline the fact that strains between
the coalition parties persist. Fini has often made veiled threats to resign over
recent months and well before this particular row LN leader Umberto Bossi
noted, in reference to Berlusconi’s conduct as president of the EU, “If captain
Berlusconi doesn't set the course, the ship will crash against the rocks,”
inadvertently promoting the prime minister from the role of cruise-ship crooner
he once held.
However, possibly the most telling remark came from a senior LN party member,
Alessandro Ce, who in early July said, “There is no way we can stay in this
government the way things currently stand....There is a really poisonous air in
the government and the parliamentary majority these days.”
Popular Support
After the mid-term judgment delivered by the electorate at the local elections,
further indicators regarding the government's performance and the electorate's
concerns emerged on June 26. A poll published in Milanese daily newspaper
Corriere della Sera carried out by Ispo/Cra Nielsen on June 15 showed that the
chief concerns of the electorate were not the same as those of the many critics
abroad who have been keen to give voice to their concerns in recent months.
Percentage responses from all of those polled on the “priorities that the
government needs to address” in descending order, were as follows:
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September 2003
Ranking
Priority
1
2
2
4
5
5
7
8
8
10
11
11
11
11
Struggle against unemployment
Cutting taxes
Boosting country's economy
Immigration (as source of crime)
Conflict of interests
Struggle against crime
Laws for greater job flexibility
Pension reform
Struggle against terrorism
More efficient legal system
Immigration (boosting integration)
Fighting public sector corruption
Bringing down public debt
Parliamentary immunity
Percentage
Share
15
11
11
8
6
6
5
4
4
3
2
2
2
2
The percentage of “other/don't know” in fact achieved the highest score. As
many as 19% of those questioned had either no view or maybe did not find their
preferences on the list.
The ranking makes for an interesting comparison with what the present
government has actually achieved in two years against the matters that really
bother the electorate. Some would argue that the traditional Italian attitude of
laissez-faire implies tacit rather than explicit support for the government.
Others, though, could reasonably argue that the government has actually done
little to cut the jobless and lower taxes, boost the economy, or implement
pensions’ reforms.
Yet others would perhaps be anxious that the seeming concerns that immigrants
are a “source of crime” comes so high on the list, whilst integration pulls up at
joint bottom, along with worries about the parliamentary immunity issue which
has generated so much debate both in the government and elsewhere.
*
*
*
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International Country Risk Guide
September 2003
PORTUGAL
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
87.5
35.0
36.0
79.3
Low
Current
09/03
86.0
36.5
34.5
78.5
Low
One Year
Ahead
Worst
Best
Case
Case
79.0
86.0
33.0
36.0
34.0
39.0
73.0
80.5
Low
V.Low
Five Years
Ahead
Worst
Best
Case
Case
78.0
90.0
30.0
38.0
32.0
39.0
70.0
83.5
Low
V.Low
POLITICS
Opposition Involvement in Pedophile Case
Life just continues to get worse for the opposition Socialist Party (PS), and its
unfortunate leader Eduardo Ferro Rodrigues. Just a year after losing the March
2002 general election to the center-right Social Democratic Party (PSD), the PS
was shaken in May and June when some of its key officers were implicated in an
inquiry into an alleged child sex ring.
The inquiry centers on the Casa Pia network of 10 state-run orphanages and
4,600 children in its care. In November 2002 a driver employed at one of the
orphanages admitted publicly that he had procured young boys for the sexual
delectation of politicians and celebrities. The driver, Carlos Silvino, was
instantly arrested and charged and the investigation immediately commenced.
What particularly shocked the nation was that it quickly became clear that the
authorities had known of the allegations since the 1980s.
Suspicion fell, in particular on Paulo Pedroso, who, as PS Secretary of State for
Labor and Training from 1999 to 2001, was responsible for the Casa Pia homes.
On May 21 , Pedroso was arrested and detained, but not charged, on suspicion
15 counts of sex with children between 1999 and 2000. |He strenuously denies
all the allegations.
Also under investigation is former ambassador to South Africa, 67-year old
Jorge Ritto, who also denies any wrongdoing. However, it has transpired that
Ritto had been suspected in 1981 of sex with children supplied by Carlos
Silvino, and the police even allegedly had photographs implicating Ritto.
However, the case never proceeded, and the photographs went missing.
when Silvino was arrested, scores of former Casa Pia children came forward to
give evidence and the German authorities revealed that Ritto had been removed
from the Consul’s office in Stuttgart after an alleged sexual act with a young boy
in a public park.
Widening Allegations
These arrests added further fuel the raging press speculation, which dragged the
name of just about every leading PS politician and supporter into the case,
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including that of party leader Ferro Rodrigues. In an effort to stem the tide of
innuendo, Ferro Rodriques claimed on May 25 that he and the PS had become
victims of a deliberate smear campaign over the case. He said that he had no
idea why his name had cropped up in the investigations, and affirmed that he was
not a suspect. He added that the PS should also seek to ascertain from the
Attorney General Jose Souto de Moura, who was trying to disgrace the party—
and why.
Souto de Moura had already encountered an initial foray by the PS into the
investigation, or to be more precise, into allegations by Ferro Rodrigues that he
and other PS party members had their telephones tapped by security services in
the lead up to the investigation. On May 23 Rodrigues complained, “From the
precise moment the Attorney General says that I am not a suspect in any crime,
and since I am a member of the Council of State and the Secretary General of
the Socialist Party, and after being confronted with the very serious reports that,
for several days at least, my phone and that of our parliamentary leader Antonio
Costa were tapped, I expect the Attorney General to say…that these claims are
not true.”
Souto de Moura hit back, saying that any wiretapping had to be undertaken
under a magistrate’s order, and any evidence destroyed if not applicable to the
case under investigation. He said that if the politicians did not trust the
magistracy, the courts may as well be shut down and the country revert to the
law of the jungle. Moreover, he was deeply disturbed that PS politicians had
openly admitted receiving leaked information about the wiretapping and the
investigation.
He concluded somewhat naively, “It is clear to me that any attempts to turn this
investigation—in my view artificially—into some kind of political earthquake,
will have no effect as far as the judiciary is concerned.”
In yet another attempt to stop the rumormongers, Ferro Rodrigues asked the head
of the inquiry, Assistant Attorney-General Joao Guerra, if he could make a
presentation in the belief, as he put it, that by giving evidence, the identity of the
true culprits would be ultimately be revealed.
Thus it was that the SP leader spent six hour before the inquiry on June 4.
However, far form dampening down the rumors, it led to further speculation in
the media that he was somehow involved. After presenting his case Ferro
Rodrigues said on leaving the inquiry, “I went in to testify with total confidence
that the truth will be ascertained, and I left with the strengthened certainty that
the truth will be fully established.”
He continued Ferro Rodrigues said, “I went in convinced of the innocence of the
parliamentary deputy Paulo Pedroso, and I came out with the same absolute and
unswerving conviction. I went in determined to lay criminal charges against the
author or authors of such an infamous slander once the case is no longer sub
judice. I came out more determined than ever to do so. I stand by everything I
have said regarding this case.”
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Government Reaction
Naturally enough the government parties were eager, not only to condemn
pedophilia in the strongest possible terms, but also to put as much distance
between themselves and the allegations as possible. On May 29 Prime Minister
Jose Manuel Durao Barroso, of the PSD, publicly voiced his concern over the
allegations of pedophilia, wiretappings, leaks, and arrests of key public figures.
He insisted the government was fully behind the judicial inquiry and that he
would ensure it would be thorough “In the name of the government and of the
parliamentary majority supporting the government.”
Naturally, the issue of phone wiretapping of politicians was a matter of some
concern to, well, all the politicians, some of whom called for a parliamentary
review of the regulations. Durao Barroso was for none of it, saying that this was
not the time to change the law, but to apply it. He declared, “For my part I have
confidence in the justice system. The Portuguese have confidence in the justice
system. Let us render unto the judiciary that which belongs to the judiciary, and
to politics that which belongs to politics. I have no wish to mix up the two.”
Given the propensity for politicians to be mixed up in any manner of
peccadilloes, perversions, and priapic proclivities, his words may yet come back
to haunt him.
Outlook
The allegations of sexual abuse have stirred up more than just political tensions
in the deeply Catholic state. Years of hidden sexual abuse in public life and in
private family life went unreported and uninvestigated because of the social
stigma attached to the victims.
In some ways, the social awakening to the issue may soften the political impact
on the PS, but in the short term the impact has been clear. A July 3 opinion poll
showed that Durao Barroso had overtaken Ferro Rodrigues in the popularity
stakes, even though the PS would receive 44.9% of the vote (37.9% in the 2002
general election) and the PSD just 34% (40.1% in the general election).
It is obvious that the mud has stuck to Ferro Rodrigues, even though the PS is
increasingly popular. However, if Pedroso and Ferro Rodrigues continue to be
linked to the investigation, it is just a matter of time before the PS suffers. The
party may well decide that with the sharks continuing to scent blood, it would be
better to encourage Ferro Rodrigues to walk the political plank than suffer a
critical loss of public support.
The real danger for the politicians of all political stripes is that the can of worms
has been well and truly opened, and that there will be a grand moral catharsis in
which their personal activities are displayed for all to see.
Socioeconomic Conditions
Large areas of Portugal’s forests, especially in the Algarve and Silves regions,
were engulfed by fire through late July and well into August. Although the
unusually high temperatures in Europe this summer created the ideal conditions
for forest fires, many of the blazes, which began on July 19, have been attributed
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September 2003
to arsonists. By mid-August, police had arrested 60 alleged arsonists. In one
arrest on August 11, Four youths, aged 18 to 21 were caught red-handed in an
isolated spot in the outskirts of Guarda, after having allegedly set fire to an area
of woodland and grass. In another arrest, police detained a 76-year old woman.
Parts of Portugal are experiencing the strongest heat wave since records began.
In some southern and interior regions of the country temperatures have remained
persistently above 40o Centigrade (C) or 104o Fahrenheit (F), since July28, and
many cities have hit all-time record temperatures. The highest temperatures
were recorded were 47.2o C (117o F) in the village of Amareleja in Alentejo
province, south of Lisbon.
In mid-August, the Forestry General-Directorate upped its estimate for the
overall woodland area destroyed so far this year to some 215,000 hectares
(approximately 531,000 acres), almost all of it since the blazes began in July.
However, independent forestry experts, who have studied satellite imagery of the
affected areas, have said the total burnt area is at least 300,000 hectares. If this
figure is confirmed, 2003 will see the worst level of damage in 23 years—well
above the area burnt in 1990, the worst year recorded as yet.
The physical costs of the disaster have not yet been compiled. However, at an
earlier stage, when the damaged acreage was estimated at 162,000 hectares, the
government estimated the cost of the damage at €925million ($1.03 billion. On
that basis, the overall bill will come to something in excess of €1.7 billion ($1.9
billion).
Corruption
On May 7, the Judicial Police arrested 15 finance officials on allegations of
corruption. Those detained included a local finance department official
suspected of corruption in fiscal administration, as well as a number of
managers. Newspaper reports suggested that the alleged crimes involve
hundreds of companies.
Little more has been reported, but if the reports are true, Portugal’s financial
community, and possibly the government, should be bracing itself for a major
scandal.
*
*
*
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SPAIN
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
82.5
39.5
39.5
80.8
V.Low
Current
09/03
82.0
39.0
39.0
80.0
V.Low
One Year
Ahead
Worst
Best
Case
Case
75.0
85.0
36.0
40.0
38.0
42.0
74.5
83.5
Low
V.Low
Five Years
Ahead
Worst
Best
Case
Case
74.0
90.0
38.0
44.0
37.0
44.0
74.5
89.0
Low
V.Low
POLITICS
Government Stability
Opposition in Disarray
At the regional elections on May 25 (see ICRG No 6, 2003), Prime Minister Jose
Maria Aznar's Popular Party (PP) won the mayoral race in the capital, Madrid,
but failed to retain its overall majority in the Madrid regional legislature. That
opened the way for the opposition Spanish Socialist Workers Party (PSOE) to
seize control. It was just about the biggest success for the PSOE in the elections,
but depended on the party being able to cut a cooperation deal with the far-left
United Left (IU) party.
Heads-down discussions between PSOE leader Jose Luis Rodriguez Zapatero
and his IU opposite number finally came up with a pact and all that remained
was for the two parties to combine their votes to elect the head of the legislature.
However, two PSOE regional deputies, Eduardo Tamayo and Maria Teresa Saez,
deliberately missed the vote because of their opposition to a coalition with the
IU. Without those two votes the PSOE and IU no longer held a majority and the
PSOE candidate failed to be approved.
Uproar ensued. The PSOE not only expelled the two dissidents for disloyalty,
but accused them of being involved in corrupt real estate deals. Threats of legal
action came from all sides, including one of the deserters, the head of the PP and
Zapatero himself.
Naturally, the PP moved to take full advantage of the disorder in the opposition
ranks by calling for a re-run of the legislative election. Given the chaotic state of
the PSOE and the damaging accusations being exchanged, a re-run of the
election was the last thing the PSOE wanted. Instead, it argued that as the two
defectors were no longer members of the party their seats should be filled by
other PSOE candidates drawn from the party’s electoral list.
An inquiry on August 21 led only to reciprocal accusations flying across the
regional assembly chamber, as the PP attempted to smear the whole PSOE, and
the PSOE in turn accused the PP of political subterfuge. In fairness the PP had,
on August 20, tried to review the voting bar placed on the two regional deputies,
thus incurring the wrath of the befuddled PSOE group.
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The problem for the PSOE is that it needed a landslide victory in the municipal
elections to use as a springboard for the general election next spring. Now, with
its only notable success at those elections mired in controversy, it has not only
lost its springboard, but also strengthened criticisms inside and outside the party
of Zapatero’s leadership qualities. These had already been called into question
by his failure to translate the strong anti-Iraq war into support for the in the May
municipal elections.
Even though Prime Minister Aznar will not be leading the PP into that election,
the PSOE still appears unable to persuade the voters that Zapatero is a credible
alternative.
Aznar appoints Successor
Prime Minister Aznar had announced his intention not to lead his party into the
2004 election a year ago, but failed to say who would succeed him. This should
have worked to the advantage of the PSOE by enabling it to pin a “lame duck”
label on the prime minister. Instead, it seems to have thrown the party into
confusion by depriving it of a target in the form of the new PP leader.
Aznar finally put the PSOE, and his own party, out of its misery on August 31 by
announcing that the new PP leader at next year’s elections would be his current
deputy prime minister Mariano Rajoy. The appointment was “rubber-stamped”
by the PP with 503 votes in favor and one against.
Never one to miss a political trick, Aznar made the announcement just as the
PSOE was holding a “historic” conference to relaunch the party for the March
elections. In order to garner as much publicity for its event as possible, the
party signaled that the conference would lay particular emphasis on plans to
devolve more power to the regions. However, the PP leadership change pushed
the PSOE conference off the front pages of every newspaper and made the lead
item in every television news report.
Once the leadership announcement had been made, the choice seemed obvious.
But that is not how it looked prior to August 31, with feverish speculation over
the appointment stretching back months, with both finance minister, Rodrigo
Rato, and the former interior minister, Jaime Mayor Oreja tipped as hot
favorites.
The popular initial reaction to the appointment was positive, but the reality is
that very little is known about Rajoy. The bare facts are that he is 48 years old, a
former property registrar, and is expected to continue the pro-US, free-market
policies spearheaded by his boss.
However, he has played a loyal, but
background role as deputy prime minister, and there are many on the political
scene who are unsure about his ability to lead from the front.
That is a potential weakness the PSOE will want to exploit. Coming out fighting
after the announcement, party leader Zapatero declared, with more than a little
relief, “Now the race really begins. Until now, to be where he is, [Rajoy] has
only had one condition— saying ‘yes’' to Aznar. But...to be prime minister, 40
million Spaniards are going to have to decide.”
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Unfortunately for Zapatero it looks like many already have. Two opinion polls,
by the state pollster CIS and the leftwing Cadena Ser radio chain, give the PP a
six and three-point lead, respectively.
External Conflict
Iraq
Having seen off the PSOE in the municipal elections, it was inevitable that the
issue of the actual threat posed by Iraq would, like US President George Bush
and UK Prime Minister Tony Blair, come back to haunt Aznar.
Media reports on August 11 said that during the pre-war debate on whether
Spain should be involved in backing the US and UK in Iraq, the Defense
Ministry had sent a communiqué to the Chiefs of the General Staff in February,
instructing them to take the line that Saddam had weapons of mass destruction
and was a threat to Spain.
In other words, the politicians were pre-empting the advice they should have
received from the military about military matters. Aznar subsequently told
parliament on February 5 that the information he had received from the UN
Arms Inspectors was that, “The Iraqi regime has weapons of mass destruction.”
Moreover, at a meeting of the UN Security Council on March 7, Foreign
Minister Ana Palacio had said, “The progress being made by the UN weapons
inspectors is making us deviate from the objective—the disarmament of Saddam
Hussein’s regime.”
Troops Sent to Iraq
Efforts by the PSOE leader Zapatero to instigate a public inquiry into the issue
have thus far failed, but as troops left for Iraq, questions were asked what remit
the government had to send out troops that would be under the command of the
US and UK coalition forces.
The situation was not eased when on August 9 Aznar refused to hold a public
inquiry into the military airplane crash in Turkey on May 26, in which 62
Spanish soldiers returning from duty in Afghanistan were killed.
The whole issue of the crash became a huge headache for Aznar when it became
clear there was more to it than a tragic accident.
The grieving relatives formed a support group on June 29 to press for further
information about leaked information that Aznar and Minister of Defense
Federico Trillo-Figueroa had known the Russian-built transport aircraft were
unsafe. It transpired that some of the soldiers about to embark on the aircraft
that crashed had told their wives by e-mail that they were concerned about its
air-worthiness. Furthermore, it became known that the Finnish and Norwegian
governments had previously cancelled contracts for the aircraft because they felt
it did not meet international safety standards. Trillo-Figueroa subsequently
cancelled a contract for more of the planes.
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When the soldier’s bodies were eventually returned to Spain on May 28 they
were met by King Juan Carlos and Queen Sofia, and Aznar and Trillo-Figueroa.
The royal couple greeted each relative solemnly and kissed them twice.
However, when Aznar and Trillo approached they were subjected to shouts from
the relatives that they were murderers and assassins. It later transpired that the
relatives had been informed by the Ministry of Defense prior to the ceremony
that the bodies would in fact be flown in and immediately buried—at night, in
order to avoid the media circus.
The whole episode did more to undermine Aznar and Trillo than anything the
PSOE managed to do, bringing to mind the old adage that political parties don’t
win elections—they just lose them.
Internal Conflict
Basque Region
The ongoing problems with the Basque terrorist separatist group ETA and the
principles of regional devolution took a backward step in August when a “road
map” floated by the leader of the Basque Nationalist Party (PNV) Juan José
Ibarretxe, was dismissed out of hand by Aznar.
It was unclear who had leaked the draft plan to the media but the result was
never in doubt. Ibarretxe’s plan, to share sovereignty with Spain while having
regional autonomy for the economy and judiciary, was never really likely to find
favor. Aznar, whose harsh clampdown on ETA has been relatively effective,
would in any event have seen little need to give ground to further Basque claims
for autonomy. When it became clear that Ibarretxe’s plan also included an
option for a regional referendum on independence, it was rejected out of hand.
Aznar pulled no punches saying, “The aims of nationalism and of terrorism are
identical, and the plan is utterly incompatible with the constitution”. Justice
Minister José María Michavila agreed saying that the Constitutional Court would
annul the move, and that parliament would refuse the plan anyway. Ibarretxe
said the plan had been turned into a phony debate by people who wanted to
present the proposal as secessionist, when he preferred to think of it as a free
associated community.
Whatever the semantics, the plan or any alternative will simply not be
considered by Aznar or the PSOE, which also made its opposition clear.
Terrorism
Meanwhile, ETA has again stepped up its attacks on the vital tourist industry.
Bombs planted in the resorts of Alicante and Benidorm on July 23 injured 12
people. Further parcel bombs quickly followed throughout the Basque region.
On August 4, ETA followed up its actions by issuing a statement that said, “In
2003 ETA will once again strike hard against the Spanish tourist industry and it
cannot guarantee that anyone who enters the war zone will not be injured.” It
then blamed the police for reacting too slowly to telephone warnings to prevent
injuries to tourists.
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September 2003
Arrests
Meanwhile, the government’s utilization of the new international effort against
terrorism secured further success in Mexico where ten members of ETA’s
financial and logistical network were arrested on July 19. Six of those arrested
were on the run from Spanish Police.
On July 30 a further three ETA suspects, including the most wanted Jose
Candido Sagarzazu Gomez—a member of the Donosti commando—were
arrested in France with a large amount of explosives in their possession.
The arrests were certainly a big blow to ETA, but its campaign is unlikely to
cease. Moreover, its campaign of attacking tourist destinations could be
counterproductive in that its ability to extort funds from local businesses will
eventually be affected as those businesses lose the tourists who provide the bulk
of their earnings.
*
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*
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September 2003
EUROPE
(NON-EUROPEAN UNION)
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81
International Country Risk Guide
September 2003
CURRENT RISK ASSESSMENTS AND FORECASTS
COUNTRY
Albania
Belarus
Bulgaria
Croatia
Cyprus
Czech Republic
Estonia
Hungary
Iceland
Latvia
Lithuania
Malta
Moldova
Norway
Poland
Romania
Russian Federation.
Serbia &
Montenegro
Slovak Republic
Slovenia
Switzerland
Ukraine
CURRENT RATINGS
Political
Financial Economic
Risk
Risk
Risk
09/03
09/03
09/03
68.5
33.5
32.0
62.0
38.0
30.5
71.0
36.5
36.0
72.5
37.0
35.0
83.0
43.5
41.0
78.5
41.0
37.0
75.0
37.0
38.0
84.5
34.5
34.5
90.0
31.5
39.0
78.5
39.5
38.5
78.5
37.0
37.5
86.5
37.5
35.5
68.5
31.0
29.5
88.5
47.5
46.0
76.5
39.0
35.5
71.0
38.5
31.5
67.5
43.0
39.5
62.0
78.5
80.0
91.0
59.5
26.0
37.5
41.5
47.5
40.5
22.5
35.0
38.0
43.5
37.5
Year
Ago
10/02
66.5
61.3
71.5
72.8
80.8
76.3
75.3
77.5
79.3
75.0
74.0
79.8
64.0
91.3
76.0
68.3
70.8
50.8
75.8
79.8
92.0
68.0
COMPOSITE RATINGS
Current
Forecasts
Rating
One Year
Five Year
09/03
WC
BC
WC
BC
67.0
55.5
70.0
58.0
71.0
65.3
52.0
58.0
50.5
62.0
71.8
67.5
78.0
64.5
80.5
72.3
66.5
73.5
64.0
75.0
83.8
68.5
76.5
69.5
79.5
78.3
73.0
77.0
72.5
80.5
75.0
70.5
77.0
66.5
80.0
76.8
71.0
79.0
70.0
81.0
80.3
75.0
82.5
73.0
84.0
78.3
73.5
80.0
71.5
86.5
76.5
70.0
76.0
65.5
79.5
79.8
77.0
81.5
73.5
81.0
64.5
48.5
54.0
50.0
67.0
91.0
85.5
91.0
79.0
94.0
75.5
70.5
80.0
70.0
80.5
70.5
64.5
74.0
57.5
78.5
75.0
71.3
78.5
64.5
83.5
55.3
75.5
79.8
91.0
68.8
32.5
69.5
73.0
88.3
62.5
60.5
78.0
82.5
92.0
70.5
32.5
69.5
70.5
81.5
58.5
For historical risk ratings and key economic data on these and other countries in ICRG, please go to
www.CountryData.com.
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69.5
81.5
84.0
94.0
76.5
International Country Risk Guide
September 2003
HUNGARY
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
81.0
38.0
36.0
77.5
Low
Current
09/03
84.5
34.5
34.5
76.8
Low
One Year
Ahead
Worst Best
Case
Case
78.0
86.0
33.0
37.0
31.0
35.0
71.0
79.0
Low
Low
Five Years
Ahead
Worst
Best
Case
Case
78.0
86.0
30.0
38.0
32.0
38.0
70.0
81.0
Low
V.Low
POLITICS
Government Stability
Opinion polls
Just over a year into the government of Prime Minister Peter Medgyessy, and the
opinion polls still have his Hungarian Socialist Party (MSzP) and the minor
coalition Alliance of Free Democrats (SzDSz), way ahead.
A May 23 poll showed the MSzP on 35% and the opposition Fidesz of former
prime minister and current leader Viktor Orban, lagging behind on 27%. The
figures for the June polls barely changed, despite the status law debacle (see
below). Although the MSzP popularity dipped a little, it remained constant
among those who actually turn out to vote, and among its own party supporters.
The poll revealed that five out of ten voters would support the MSzP, four would
back Fidesz, and just one would back the other parties.
External Conflict
As an aspiring member of the European Union (EU), Hungary is supposedly
signed up to the rights and responsibilities of membership. One of the key tenets
of the EU is that no nation has the right to interfere in another nation’s policies
or government.
Unfortunately, the April 2002 general election that saw the MSzP/SzDSz
coalition take power from former Prime Minister Viktor Orban’s FIDESZ party,
also inherited his Status Law policy.
The Status Law
The Status Law was an attempt to pre-empt EU controls on cross-border
recognition of ethnic groups, by giving ethnic Hungarians living outside of
Hungary greater rights and support from their home country. The support would
enable them to have easier access in and out of Hungary, and a range of
healthcare grants and sweeteners to help them retain their ethnic identity.
This did not go down well with countries like Romania, Slovakia and others with
significant ethnic Hungarian minorities as it appeared to offer greater benefits
and rights to those minorities than were enjoyed by the countries’ own citizens.
The countries affected promptly complained, loud and long to the EU.
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Their case was that the Status Law was divisive and that it cut the EU’s policy
on fairness and equality in cross-border movements, and in governmental
financial backing for particular businesses or ethnic groups, over other EU
member states.
The issue was due to come to a head at the Parliamentary Assembly of the
Council of Europe (PACE) on June 25, when a Dutch member of parliament,
Erik Juergens, was due to present a report on the impact and implications of the
Status Law that was expected to be damning.
Status Law Amended
In an eleventh-hour attempt to avoid this condemnation, the government moved
an amendment to the Status Law in the Hungarian National Assembly on June
23, removing references to a “Unified Hungarian Nation” and to other
contentious issues. In its amended form, the Status Law conformed to EU
guidelines by offering little other than grants and benefits to encourage cultural
education and exchanges.
Foreign Minister Laszlo Kovacs said the amendment was introduced to ease
tension with neighboring countries and to help it conform to EU guidelines. In
addition, although Hungary would implement the Schengen agreement
(facilitating easier cross-border movement between EU member states) fully,
ethnic Hungarians would be offered visas on the most preferential terms
possible.
OSCE Concerns
However, opposition to the Law had already built up a head of steam in
European institutions. On June 24, immediately following the amendment to the
status law and just prior to the PACE meeting, Rolf Ekeus, the High
Commissioner on National Minorities at the Organization for Security and
Cooperation in Europe (OSCE), said the Status Law would still cause problems
because it needed secondary legislation.
Ekeus said, “… it is a basic principle of international law that a State may only
act within its jurisdiction, which extends to its territory and citizenry. At the
same time, the State of territorial jurisdiction should be positively disposed to
agree to arrangements within the framework of its obligations to ensure full
respect for the rights of persons belonging to national minorities. One can
conclude that the deliberations in relation to the Act have demonstrated the
importance of the principle that protection of human rights and fundamental
freedoms, including for persons belonging to national minorities, is the
responsibility of the State having jurisdiction with regard to the persons
concerned.”
In other words, even with the amended status law, it would be useless without
the agreement of the governments of Slovakia, Romania, Slovenia, Ukraine,
Croatia, and Serbia Montenegro, in which most of the three million ethnic
Hungarians outside Hungary’s borders live.
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Amendment Ignored
But worse was to come. When Juergens presented his verbal report to the PACE
meeting on June 25, it made no reference to the amendment. Speaking to his
report, Juergens said, “In my opinion, Hungary must be very cautious. If they act
unilaterally, they fan up old tensions in the region.”
Although based almost entirely on the original Status Law, the final proposal
reached by the PACE did make veiled references to the amended version, but
was not exactly fulsome in its praise. It rebuked Hungary for attempting to
interfere in the sovereignty of neighboring states by not agreeing the law with
the nations concerned prior to its implementation, and suggested that further
amendments would be necessary.
Hungarian Fury
It was clear that not all members of the PACE had grasped the depth of the
amendments introduced to the original Law. Consequently, the Hungarians
were livid, and the PACE members increasingly bemused and puzzled.
Speaking on the PACE decision, Csaba Tabajdi, the head of the Hungarian group
at the PACE, said that it was a nonsense that Juergens had insisted on
completing his presentation when the amendment complied with the demands of
the Venice Committee—the PACE’s own legal advisory group. Moreover, the
members of PACE were seemingly unaware of the government’s amendment of
the Status Law, despite Hungarian efforts to have the discussion deferred until
the situation was clarified for all member states. Both Tabajdi and Foreign
Minister Kovacs rejected calls to further amend the Law.
OSCE All Clear
Matters began to clear on July 1 when Commissioner Ekeus, obviously having
taken the trouble to read the new Law, declared that it was no longer
discriminatory, and that neighboring countries would probably reach agreement
soon.
So with Europe finally at ease with the Status Law, all that needed to be done
was for all the neighboring countries to sign up. Romania and Croatia did just
that, but Slovakia remains obstinately opposed and has even threatened to
introduce a counter Act to the law.
EU Accession
Of course, this sort of row does not help the government to argue its case for
accession to the EU. The April referendum on membership struggled to raise the
turnout above 50%, so the public jury is still out on the benefits of EU
membership.
Nevertheless, Prime Minister Peter Medgyessy is determined to push through EU
membership and gain as many benefits as possible. On July 1, Finance Minister
Csaba Laszlo announced his belief that the euro will have replaced the forint by
2007, assuming the budget deficit could be reduced to below 3% of GDP by
then.
* * *
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ROMANIA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
69.0
36.5
31.0
68.3
Mod.
Current
09/03
71.0
38.5
31.5
70.5
Low
One Year
Ahead
Worst Best
Case
Case
67.0
74.0
35.0
39.0
27.0
35.0
64.5
74.0
Mod.
Low
Five Years
Ahead
Worst Best
Case
Case
60.0
78.0
30.0
41.0
25.0
38.0
57.5
78.5
High
Low
POLITICS
Government Stability
Cabinet Reshuffle
In order to meet the requirements for membership of the European Union (EU),
Prime Minister Adrian Nastase pledged to reduce bureaucracy in government,
and reduced the size of his cabinet on June 16.
In a whirlwind of changes some ministers were simply fired for being inefficient,
while others were relocated, or moved sideways. Nastase said the cuts were
necessary to prepare Romania for the outset of EU membership discussions in
2004. One of the key changes was the merger of the Interior and Public
Administration ministries.
The new cabinet is:
Ministerial Post
Prime Minister
Foreign Affairs
European Integration
Finance
Defense
Public Administration and Interior
Justice
Labor, Social Solidarity and Family
Economy and Trade
Agriculture, Waters, Forests, and
Environment
Transport, Constructions and Tourism
Education, Youth and Research
Culture
Health
Communication
Government Coordination
Minister
Adrian Nastase
Mircea Geoana
Hildegard Puwak
Mihai Tanasescu
Ioan Mircea Pascu
Ioan Rus
Roadica Stanoiu
Elena Dumitru
Dan Ioan Popescu
Ilie Sarbu
Miron Mitrea
Alexandru Athanasiu
Razvan Teodorescu
Mircea Beuran
Dan Nica
Serban Mihaileascu
In addition, Nastase appointed six Delegate Ministers, giving a grand total of 22
ministers compared with the previous grand total of 27.
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Delegate Ministerial Posts
Coordination of Control Activities
EU Chief Negotiator
Parliament
Public Administration
Social Activities
Trade
September 2003
Delegate Minister
Ionel Blanculeascu
Vasile Puscas
Axinte Gaspar
Gabriel Oprea
Marian Sarbu
Eugen Dijmarescu
Apart from achieving a modest decrease in the number of ministers, the reshuffle
also gave Nastase the opportunity to address problem areas like health, where
cutbacks in spending have left many hospitals completely unable to meet the
most basic levels of hygiene and care.
Popular Support
Although the government’s failings in health, and other areas, have attracted a
good deal of criticism, they do not seem to have damaged its overall public
standing to any great extent. An opinion poll released on June 27 showed that
Nastase’s Social Democratic Party (PSD) enjoyed 43% of public support, with
the opposition National Liberal Party (PNL) on 22%, and the opposition
Democratic Party (PD) on 11%.
In addition, on July 7 the PSD gained more voter support when it merged with
the much smaller Socialist Party of Labor (PSM) and the National Socialist
Renewal Party (PSRM). The rationale behind the merger was given by PSD
Vice-President Ioan Mircea Pascu, who said, “There cannot exist several Social
Democratic parties in a member state of the European Social Democratic family
and this is also valid for other political families.”
Coalition Divisions
With a general election due in the fall of 2004, Pascu’s consolidation message
was not lost on the other parliamentary parties, including the junior party in the
government coalition, the Romanian Humanist Party (PUR). It could, it seems,
lead to the party leaving the coalition altogether.
The problem appears to be that the PUR is beginning to re-identify itself as a
Christian-Democratic party within the broader EU political scene, that is, on the
center-right, a positioning that would make it increasingly difficult for the party
to be allied to the PSD, which, while moving towards the center, is doing so very
much from the left. This had led some country-level PUR organizations to break
regional cooperation agreements with the PSD, most notably in Bacau County,
and speculation that the PUR would find itself more comfortable in alliance with
the opposition National Liberal Party (PNL).
On August 12, the PSD leadership called on PUR president Dan Voiculescu to
make his position clear. As PSD Secretary-General Matei Agathon Dan
commented, “If the PUR changes its doctrine, and joins the right-wing PNL, it is
hard to believe we can still make a deal.” As the PUR only has six seats in the
Chamber of Deputies and four in the Senate its departure would not collapse the
government. But it could be a setback so close to the election.
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Opposition Divisions
While the PUR may, or may not, be toying with the idea of an alliance with the
PNL, the PNL is certainly looking for a linkup with PD. On July 9 the Executive
Bureau of the PNL announced that it would consider an electoral alliance with
the PD, with suggestions by some party members that the two parties could
merge after the election.
Unfortunately for the PNL its proposal met with a firm rebuttal from PD leader
Traian Basescu, who said the idea was born of intoxication, and may even have
started within the PSD, because Nastase had recently referred to a PNL-PD
alliance. So will it happen? Basescu’s comments suggest not, but then it is not
entirely unknown for a politician to say one thing and do another.
Corruption
Fleet File
Life has been decidedly uncomfortable for Basescu of late. Having fended off
the advances of the PNL, he was then placed under formal investigation on
August 8 by the National Corruption Prosecution Office (PNA), and accused of
abuse, embezzlement, forgery, and use of fraud. The charges related to his
period as one of three transportation ministers in the 1993-1996 government of
Prime Minister Nicolae Vacaroiu, and the privatization of the Romanian
shipping fleet.
Clearly believing the case is politically motivated, Basescu said, “Romania has
now a privately-owned fleet. If I am not wrong, the State Ownership Fund [FPS]
was set up with the view to privatization: the incumbent officials will lose the
elections, despite this frame-up.”
It looks like being a long and damaging case, but not only for the PD. The
likelihood is that both the PD and PSD will not only be at each other’s throats
for the duration of the investigation, raising the likelihood that a prolonged spate
of allegation and counter-allegation will only serve to diminish the standing of
both parties in the opinion polls.
External Conflict
EU Membership
While the rest of Europe went happily about its business during the EU summit
in Thessaloniki on June 20, Nastase and his team were pouring over every
utterance, trying desperately to impress the key players with their enthusiasm
and looking for a signal that they were accepted into the locker room.
Having been knocked back for full EU membership in 2004 at the Copenhagen
summit in November 2002, the European Council expressed its support for
Romania in its efforts to achieve the objective of membership in 2007. In doing
so, the EC set up a roadmap for accession for both Romania and Bulgaria.
Nastase said on June 20, “We expect this signal together with the one to be sent
at the end of the Italian presidency in late December to be benchmarks, together
with the EU progress report that should enable us to conclude negotiations next
year.”
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He added that there would be many discussions on the shape of the new Europe
over the next few years and that he wanted Romania to be an active participant
in the debate; but to do so Romania would have to be on track for membership.
Emphasizing his desire to be a full player, Nastase said of the Thessaloniki
discussions, “These issues will be important for us in the period ahead. It will be
important to participate in these discussions and not be a spectator of debates,
especially since they will be important for the Romanians' future as well,
starting in 2007. We cannot enter a formula prepared by others without having
the possibility of expressing our opinion in this pre-accession period.”
Socioeconomic Conditions
IMF Letter of Intent
There is a downside to EU membership, not least in the need to have an
economy suited to the job. On August 4 the International Monetary Fund (IMF)
and government officials reached agreement on a supplementary letter of intent,
in particular over salaries paid in state-run industries.
Neven Mates, chief IMF negotiator for Romania said, “In the first half of 2003,
the macroeconomic trends continued to be favorable, with GDP growth powerful
and with the inflation's decrease more rapid than anticipated. The rapid rise of
salaries over the level justified by the labor's productiveness and by the credit
expansion to the private sector also induced more powerful demand from the
private sector and applied pressure upon imports. As a result, the deficit of
current account increased in comparison with the forecasts. The impact of the
powerful increase in real salary upon the external competitiveness remains a
preoccupation.”
It remains a preoccupation for Nastase too, especially in the auto and coal
mining sectors, where industrial unrest has already been rife. The imprisonment
of the leader of the miners’ union, Miron Cozma, following his arrest during a
protest march, led to calls from the trades unions on July 31 for a presidential
pardon.
In addition, auto plant workers at ARO Campulung went on strike and on hunger
strike in late July because they had not received their salaries. Hardly perfect
conditions for encouraging the supposedly imminent privatization of the plant.
EU Pre-Accession Program
The government approved its Pre-accession Economic Program 2003 (PEP) on
August 14. The aim of the program is to set the economy on track to meet the
EU convergence criteria as set down by the Maastricht Treaty, through:
•
•
•
•
boosting economic growth;
significantly increasing investments;
improving the sustainability of the public finances by the strict control of
the budget deficit and improving the collection of public revenues; and
significantly reducing inflation.
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The PEP also aims to accelerate the structural reform process, enhance wages
policies, significantly improve the business environment, and optimize
legislation regarding bankruptcy and its implementation, further develop the
financial sector, and improve the access to financing of small and middle-sized
enterprises (IMMs).
The key targets set by the PEP for the 2003-2006 period include:
•
•
•
•
•
•
a real GDP growth of 5.2%;
industrial output growth of 5%, especially due to the increase of the
output of processing industry's branches;
a gradual reduction of the inflation rate to 4% by 2006;
the budget deficit to rise to 3.3% of GDP over 2003-2006, and the
government to continue the policy of reducing the taxation rate on
social insurance contributions;
maintaining a high growth level for exports of goods and services at
a higher level than for import growth, and maintaining the current
account within sustainable limits;
completing the privatization of commercial companies, the
restructuring of the labor force and the development of the finance
and banking sector.
Black Economy
With the need to maximize revenue collection in mind, the government launched
(yet) another crackdown on “illegal” workers in mid-August. Announcing on
August 18 that he had asked the National Oversight Authority and the Labor
Inspection to present a report to government on the situation, Prime Minister
Nastase said that data obtained so far reveal that there are several hundreds of
thousands persons working illegally in the underground economy, who
consequently neither pay taxes on their income nor benefit from state social
protection.
The government is concerned on both counts. As Nastase put it, “The existence
of illegal labor creates us problems on short term, through the non-taxation of
some of these activities, and on long term, because these persons need additional
social protection when they reach the retirement age.”
The prime minister went on to say that checkups on illegal workers would be
tightened through a monthly monitoring of the growth of the tax-paying
employees and state benefit beneficiaries.
Nastase also announced that the Ministry of Public Finances would present to
the government, twice a month, the situation of the budget debts of the 500 large
taxpayers and the revenues achieved from arrears, as well as a report regarding
the sum of approximately 27 trillion lei ($825 million) representing the unpaid
receivables to the National Health Insurance Fund.
*
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*
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UKRAINE
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
59.5
39.5
37.0
68.0
Mod.
Current
09/03
59.5
40.5
37.5
68.8
Mod.
One Year
Ahead
Worst Best
Case
Case
57.0
63.0
35.0
40.0
33.0
38.0
62.5
70.5
Mod.
Low
Five Years
Ahead
Worst Best
Case
Case
57.0
70.0
30.0
43.0
30.0
40.0
58.5
76.5
High
Low
POLITICS
Democratic Accountability
Constitutional Changes
President Leonid Kuchma suffered a major setback in his efforts to hang on to
office beyond the constitutional two-term presidential limit in early July when
parliament (the unicameral Supreme Council) failed to vote on his proposed
constitutional changes.
The saga began in March this year when Kuchma announced he was sending a
Bill to the 450-seat Supreme Council (parliament), setting out a new constitution
(see ICRG No 6, 2003). If approved by parliament, the new constitution would
then have to be approved by the people in a referendum.
The new proposals didn’t actually provide for an extension of Kuchma’s current
term or for the two-term limit to be extended. However, one of the proposals
was that the presidential, parliamentary, and local elections should be realigned.
This would have the effect of shifting the presidential election, due in 2004, to
2005 or even 2006, giving Kuchma up to an additional two years in power. On
top of that, he could try to legitimize an additional term in office by declaring he
was standing under a new constitution.
The opposition members of parliament had no intention of falling into so
obvious a trap. The storm of protest the draft constitution produced in
parliament was so intense that Kuchma was forced to withdraw it. But,
desperate to get it through, he resubmitted it to parliament on June 19 with some
amendments agreed with his supporters, but with the key clauses he needed still
included.
The concessions he made were the removal of the proposals to:
•
•
•
establish a bicameral parliament;
reduce the number of legislators (currently 450); and
allow the direct passage of laws by means of a nationwide
referendum.
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In return, Kuchma said he expected parliament to compromise on his other
proposals, including the presidential right to appoint the Foreign Minister, the
Defense Minister and the Interior Minister, as well as the heads of the Security
Service of Ukraine, the State Customs Service, the State Tax Administration, and
the State Committee for the Defense of the State Border. He also stressed the
need to align the dates of elections for president, parliament, and local
government, and that each should run for five years.
In submitting the amended constitution to parliament, Kuchma said, “I hope that
parliamentarians are aware of their responsibility for the fate of Ukraine. I am
confident that we have much more in common, compared to what separates us.
On the scales of discussion, ‘yes’ outweighs ‘no’ by far. I look at the distance
that lies ahead with optimism, because I know how much has already been
overcome. I am confident that we will manage to create a formula of governance
which will enable our state to be not just democratic and strong but also
satisfying for its every citizen.”
Some hope.
Opposition
When the bill went to parliament on July 3, Speaker Volodymyr Lytvyn
struggled to keep order, as opposition legislators shouted and argued. A fistfight
developed and opposition legislators mobbed the speaker’s rostrum. Unable to
proceed, Lytvyn brought the session to a close.
The leader of the Our Ukraine (NU) opposition party, former prime minister and
leading opposition contender for the presidency, Viktor Yushchenko, said that
Kuchma’s proposals were not political reform but a revision of the constitution
whose sole objective was to prolong power rather than ensure real democratic
changes in the state. He summed up with the words, “We understand the regime
will use these amendments to prolong its term and completely stifle democracy.”
Communist Party of Ukraine (KPU) leader Petro Symonenko simply said the
general election should be held in 2004 “as required by the constitution.” He
added that if parliament supported the principle of simultaneous elections, the
presidential election could still be held as currently scheduled in 2004, and
another held alongside the general election in 2006. There was no reason to
extend the current presidency.
But, while the opposition from these and the other opposition parties was
expected, the failure of the ostensibly pro-Kuchma majority to support the
amended Bill was not—and it drove Kuchma to fury. Responding to the failure
of parliament to pass his amendments, Kuchma said on July 7, “This was a
typical example of absolute political irresponsibility. Not only on the part of the
minority, that is the opposition, which has been recently quite often guided by
the principle ‘the worse the better.’ but also on the part of the majority, which
assumed responsibility, but was equally not up to the task.”
In other words, his proposals had not only rallied the opposition parties against
him, but also failed to garner the support of his allies.
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Constitutional Court Option
Desperate to find a way out for his master, the parliamentary majority
coordinator, Anatoliy Tolstoukhov, said that it would be possible for parliament
to vote to send the proposals to the Constitutional Court for a final decision.
Yushchenko was not averse to the proposal, but insisted that he would only
support the Constitutional Court route if no preference was given to any
individual proposal. In other words, the Court would have to decide whether
Kuchma’s constitutional Bill was constitutional as a whole, not whether
individual clauses had any political validity or practical application.
As Yushchenko knew full well this was of no use at all to Kuchma, as the
individual clauses in the amended Bill would still have to be returned to
parliament for debate.
With nowhere left to go, President Kuchma finally threw in the towel on July 15.
He accused parliament of dumping the issue on the Constructional Court rather
than fulfilling its duty to make a decision itself, and announced that he would
withdraw his draft constitutional amendments from both parliament and the
Constitutional Court.
He refused to accept that it was an opposition victory. However, the leader of
the opposition Our Ukraine (NU) bloc, Viktor Yushchenko, welcomed
Kuchma’s decision.
Kuchma’s Position
It now looks very much as if the whole affair has left Kuchma high and dry.
From an unassailable position just 18 months ago, he appears to have dug his
own political grave through a mixture of bad management, bad judgment, and
bad luck.
His crude attempt to extend the presidency at any cost has effectively handed it
over to Yushchenko on a plate. The fact that Kuchma’s supporters seem to be
deserting him may lead some of the key protagonists to jump ship early. Overall,
it seems that the writing is on the wall for Kuchma, and, unless he very quickly
cuts an immunity deal with Yushchenko, he could well reap a legal whirlwind in
the post-presidential period could that could see him locked up in jail for a very
long time.
*
*
*
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International Country Risk Guide
September 2003
NORTH AFRICA
MIDDLE EAST
AND
CENTRAL ASIA
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September 2003
CURRENT RISK ASSESSMENTS AND FORECASTS
COUNTRY
Algeria
Armenia
Azerbaijan
Bahrain
Egypt
Iran
Iraq
Israel
Jordan
Kazakhstan
Kuwait
Lebanon
Libya
Morocco
Oman
Qatar
Saudi Arabia
Sudan
Syria
Tunisia
Turkey
United Arab Emir’s
Yemen, Republic
CURRENT RATINGS
Political
Financial Economic
Risk
Risk
Risk
09/03
09/03
09/03
45.5
43.5
43.5
61.0
31.0
32.5
64.0
38.5
35.0
77.0
44.0
38.5
64.0
34.0
33.5
58.0
46.5
36.5
41.5
22.5
20.0
67.5
39.5
38.0
69.5
36.5
36.0
70.5
37.0
37.0
78.0
47.5
47.0
60.0
25.0
26.0
62.0
44.0
41.5
73.5
40.0
37.0
75.5
42.0
42.0
73.0
36.5
47.5
67.0
45.5
41.0
45.0
29.5
34.0
64.5
39.0
37.5
73.0
36.0
36.5
65.5
31.5
26.5
78.0
45.0
46.0
62.5
35.0
36.5
Year
Ago
10/02
61.3
60.3
67.3
80.3
66.8
63.8
45.5
65.3
70.0
72.3
81.5
55.5
69.5
72.5
79.8
79.3
73.0
54.3
70.3
72.0
57.3
82.0
66.0
COMPOSITE RATINGS
Current
Forecasts
Rating
One Year
Five Year
09/03
WC
BC
WC
BC
66.3
60.5
69.5
59.0
76.5
62.3
57.5
63.0
55.5
71.5
68.8
58.0
69.0
54.0
70.5
79.8
76.0
81.0
67.0
79.5
65.8
60.5
72.5
55.0
70.5
70.5
37.5
68.5
39.0
75.0
42.0
39.0
53.3
37.5
72.5
72.5
60.0
72.0
58.0
77.5
71.0
69.0
74.0
66.5
77.5
72.3
68.5
73.0
61.5
74.5
86.3
74.5
87.0
67.5
88.0
55.5
48.5
57.0
45.0
63.5
73.8
71.5
78.3
56.5
78.3
75.3
69.0
76.0
62.5
77.5
79.8
70.5
74.0
65.5
74.5
78.5
60.0
64.5
57.5
68.5
76.8
61.0
72.5
60.0
78.0
54.3
41.0
59.0
39.0
67.0
70.5
62.0
71.0
57.5
71.0
72.8
58.5
73.5
55.0
75.5
61.8
57.5
65.5
60.5
73.0
84.5
79.5
85.5
71.5
86.5
67.0
62.0
66.0
57.5
71.5
For historical risk ratings and key economic data on these and other countries in ICRG, please go to
www.CountryData.com.
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ARMENIA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
59.0
31.0
30.5
60.3
Mod.
Current
09/03
61.0
31.0
32.5
62.3
Mod.
One Year
Ahead
Worst Best
Case
Case
55.0
62.0
30.0
32.0
30.0
32.0
57.5
63.0
High
Mod.
Five Years
Ahead
Worst Best
Case
Case
55.0
70.0
28.0
36.0
28.0
37.0
55.5
71.5
High
Low
POLITICS
Democratic Accountability
The general election on May 25 produced a slight surprise in the makeup of the
government coalition, but no surprise at all in the actual management of state
power, which remains firmly in the hands of President Robert Sedraki
Kocharyan and his Armenian Republican Party (HHK). Unfortunately, it is
unlikely that the power was given by the electors, with all the evidence
indicating yet another electoral coup by Kocharyan and the HHK.
The official turnout for the election was 61.2% and the full results were:
Party
Republican Party of Armenia
Justice
Rule of Law Country, centrist
Armenian Revolutionary Federation
National Unity
United Labor Party
All Armenian Labor Party
Republic
Independents
Undecided
Total Seats
HHK
A
OE
Dashnak
NU
HZhAM
ALLP
H
% of Vote
23.5
13.6
12.3
11.4
8.8
5.7
Seats
31
14
19
11
9
6
1
1
36
3
131
The other parties that contested the election, but failed to cross the 5% of the
vote threshold were:
Party
Liberal Democratic Union of Armenia
Mighty Fatherland
Armenian Democratic Liberal Party
Dignity, Democracy, Motherland
Union of Industrialists and Women
Communist Party of Armenia
People's Party of Armenia
Labor Law Unity
HRAK
HH
ARP
DDM
UIW
HKK
HZhK
LLU
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% of Vote
4.6
3.3
2.9
2.8
2.0
2.0
1.1
1.0
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Opposition Disappointment
For the opposition parties, including the Justice coalition, the result was
devastating, especially after the rigged March 5 presidential elections when
Justice leader Stepan Demirchyan failed to beat Kocharyan.
Speaking on June 2 Demirchyan said that the general election had been a
continuation of the presidential election, and that the low turnout showed a gap
between the authorities and the people where disappointment and hopelessness
had become deeper.
He said the party had been set up at the demand of the people and had played an
important role in the political life of the country for five years. The party, he
said, had not forgotten its roots and had stuck to its principles, which is why it
was in opposition.
Election Fraud
The Organization for Security and Cooperation in Europe (OSCE) was unhappy
with the election although it did say it was a significant improvement on the
March 5 presidential election.
Infractions noticed by the OSCE on election day included:
•
•
•
•
•
•
•
•
•
A fatal shooting at a polling station in Shahumian;
Isolated incidents of violence;
The withdrawal of the Chairman of the Parliament's Foreign Affairs
Committee on Election Day, alleging intimidation;
One instance of vote buying;
Intimidation;
The presence of unauthorized persons in polling stations;
Compromised secrecy of voting by the military;
Procedures were poorly followed;
International observers experienced serious intimidation in their work
and threats to their security.
The OSCE also found significant problems during the counting process in over
30% of polling stations, including:
•
•
•
•
•
•
•
Falsification of protocols;
Ballot stuffing;
Removal of uncounted ballot papers;
Inconsistent application of criteria for invalidating ballots;
Proxies and observers were denied a clear view of the process;
Counting procedures were confused, even chaotic;
Intimidation of proxies was observed in a number of polling stations,
including a serious incident
The head of the Parliamentary Assembly of the Council of Europe (PACE), Lord
Russell-Johnston, said, “There was undoubted progress towards meeting
international standards despite a limited number of reported incidents of a very
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serious nature. I hope that those responsible will be held accountable and that
there will be no return to the sense of impunity evident in the recent presidential
election.”
Well, hope springs eternal, and if PACE honestly believes that Kocharyan will
take any further steps to improve the electoral process, it will need to spring for
at least the next four years. However, PACE seem prepared to play the long
game as far as Armenia is concerned.
Even Artak Sagradyan, the head of the Central Electoral Commission of
Armenia was removed to remark, “I think we still have a long way to go before
we can meet international standards.”
Government Stability
Perhaps the biggest clue to the election’s outcome came from President
Kocharyan who said on election day that the next government would be a
coalition. We can only assume that Kocharyan’s predictive skills will one day
enable him to foresee his own demise.
Both the HHK and the other leading pro-Kocharyan party, the Armenian
Revolutionary Federation (Dashnak) did well in the election, with the HHK
increasing its seats in parliament from 23 in the 1999 election to 31 and the
Dashnak from nine to 11.
Even so, the HHK did not do as well as its leadership had hoped, partly due to
the very poor turnout in urban areas and partly because of the vituperative
slanging match between the HHK and Dashnak during the election campaign.
As a result, the rurally-based Rule of Law Country (OE) was able to slip through
to emerge as the second largest party.
Not that this outcome worried Kocharyan unduly—the OE is staunchly proKocharyan as well. As a result a new coalition government comprising the
HHK, OE, and Dashnak was formed with relative ease, with the three parties
signing their coalition agreement at the president’s residence on June 11.
New Government
Under the agreement, Dashnak and the OE received three ministerial
appointments each, with all the other posts taken by the HHK. In addition, OE
leader Artur Bagdasaryan was appointed to the post of speaker of the National
Assembly, with Tigran Torosyan of the HHK and Vahan Ovanesyan of Dashnak
appointed deputy speakers.
In order to make way for the new entrants from the OE and Dashnak, President
Kocharyan carried out a reshuffle of the government on June 11 as follows:
From Dashnak, David Lokyan (formerly town planning minister) replaced David
Zadoyan as agriculture minister, Agvan Vardanyan replaced Razmik Martirosyan
as social security minister, and Norayr Davidyan replaced Ararat Mkrtchyan as
health minister.
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From the OE, the party’s deputy chairman Sergo Yeritsyan replaced Levon
Mkrtchyan as education and science minister, the chairwoman of the party’s
Women’s Union, Tamara Pogosyan, replaced Roland Sharoyan as culture and
youth affairs minister, and Ara Aramyan was appointed as Town Planning
Minister to fill the vacancy left by David Lokyan.
All the other ministers—all members of the HHK—retained their posts,
including Prime Minister Andranik Markaryan. The full government lineup is as
follows:
Office
Minister
Prime Minister
Andranik Markaryan
Culture and Youth Affairs
Tamara Pogosyan
Agriculture
David Lokyan
Social Security
Agvan Vardanyan
Health
Norayr Davidyan
Education and Science
Sergo Yeritsyan
Town Planning
Ara Aramyan
Foreign Affairs
Vardan Oskanyan,
Defense
Serzh Sarkisyan
Justice
David Arutyunyan
Finance and Economy
Vardan Khachatryan,
Trade and Economic Development
Karen Chshmarityan
Transport and Communications
Andranik Manukyan
Energy
Armen Movsisyan
Coordinating Territorial Administration and Ovik Abramyan
Production Infrastructures
Ecology
Vardan Ayvazyan
Head of Government Staff
Manuk Topuzyan
Bagdasaryan was duly elected by parliament on June 12. Aged only 35, he is the
youngest parliamentary speaker in Armenia’s history.
Unstable Coalition?
The new makeup may not be a happy one. The HHK and Dashnak might find it
difficult to put behind them the bitterness of their attacks on each other during
the election campaign, raising the risk not only of a fractious government, but
also that this could strengthen the OE by making it the peacemaker.
This could encourage President Kocharyan to bring one or more parties into the
coalition as a makeweight. That could bring the spotlight onto the National
Unity party (NU). The party faded quite badly in the polls and its leader,
Artashes Gegamyan, will now be under some pressure to make way for someone
else. If Kocharyan brought Gegamyan into the Cabinet, it would not only help to
offset the OE’s influence, but would also earn Gegamyan’s gratitude.
New Parliament
There is general concern that the new members of parliament may not be as
committed to the concept of democratic accountability as they might be. This is
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a particular problem for the HHK whose new government ministers must give up
their parliamentary mandate to those lower down the party roll – usually wealthy
businessmen who have bought their way onto the list. This may of course be
merely coincidental, and just an indication of their eagerness for public service.
Unfortunately experience in other former Soviet states suggests the process
subverts the democratic process, embeds corruption, and spurs the growth of
organized crime.
As yet, there have been no indications that this will happen (although Armenia is
not exactly the most lawful state in the world anyway) and crime statistics seem
relatively stable. No doubt the world’s police forces will be watching closely to
see how the situation develops, especially given that the Caucuses region is a
major route to Western Europe for heroin from Afghanistan and Pakistan.
Constitutional Referendum
If there was a shred of good news for opposition forces on May 25 it was that
President Kocharyan’s referendum on amendments to the constitution held on
the same day as the general election did not gain sufficient support to be enacted.
The key elements of the referendum proposals were to:
•
•
•
•
•
reduce the National Assembly from 131 members to 101
lift the ban on dual citizenship,
specify a limited number of instances in which the president can dissolve
parliament
remove the president’s power to appoint the government, enabling him only
to appoint the prime minister, who in turn would appoint the other
government ministers, and submit to parliament the government's program
retain the power of the president to dismiss the defense and foreign
ministers, without requiring the consent of the prime minister.
President Robert Kocharyan said in March, “The success of the referendum will
be a sign of irrefutable progress in reforming the state system, establishing the
legal authorities, developing democracy and protecting human rights. It would
be an unforgivable mistake to miss such an opportunity.”
Sadly for Kocharyan, the low turnout that made it easy to swing his friendly
coalition into government also prevented the legitimization through referendum
of his control over that government. Still, he can’t complain—one out of two is
pretty good going, and a compliant government may just introduce the changes
one by one anyway.
*
*
*
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IRAN
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
59.5
29.5
38.5
63.8
Mod.
Current
09/03
58.0
46.5
36.5
70.5
Low
One Year
Ahead
Worst
Best
Case
Case
25.0
60.0
25.0
38.0
25.0
39.0
37.5
68.5
V.High Mod.
Five Years
Ahead
Worst
Best
Case
Case
25.0
65.0
25.0
42.0
28.0
43.0
39.0
75.0
V.High Low
POLITICS
Government Stability
Life remains plenty difficult for President Mohammad Khatami, who confronts
continued resistance from the conservative clerical establishment to his efforts to
promote political and social, as well as economic, reforms. Two pieces of
legislation aimed at curbing the powers of the non-elected Guardian Council and
enhancing the powers of the elected president, respectively, have been rejected
by the same Guardian Council as inconsistent with the teachings of Islam.
The dominant reformist bloc in the parliament is now left with few options other
than calling the conservatives’ bluff—although exactly how that should be done
is not entirely clear—or folding and leaving the game to the hard-liners. The
reformists generally appear to be still prepared to fight. However, President
Khatami has reverted to form, and once again seems wary of further
antagonizing the conservatives now that his controversial legislative effort has
hit a roadblock.
As a result, discontent is growing within the ranks of the reformist camp, and
could open divisions among religious moderates if Khatami does not assert
himself. At the same time, student protesters, who have little use for clerical
leaders of either the conservative or the reformist stripe, have stepped up their
activities, bringing reprisals from the security services and praise from the US.
Concerned reformists have pressed the president to distance himself fully from
the conservative power structure, even if that means resigning, as the president
offered to do in mid-July.
Finally, the government has become embroiled in simultaneous diplomatic flaps
with the US over the country’s nuclear program, with Canada over the death in
police custody of an Iranian-Canadian journalist, and with the UK over the arrest
of a former Iranian diplomat, wanted in Argentina.
All in all, it seems that Khatami can count on rough going in the months ahead,
assuming he remains in the presidency. Providing a glimmer of hope amid the
gloom, the conservatives reportedly have floated a compromise on the legislative
bill that, although rejected by the president, provides some indication that his
decision to hold on just might end up paying dividends.
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Internal Conflict
The month of June got off to a bad start for the government, as large protests
spearheaded by student activists erupted in Tehran and descended into rioting
that spread to several other cities. A crackdown by security forces brought a
restoration of order within a few days, and some 4,000 people were arrested in
connection with the riots.
The protests were sparked by the proposal to privatize the universities, but that
cause quickly receded into the background as other groups joined in the
demonstrations to voice their frustration with the failure of the reformists to
implement promised political reforms and the obstructionist activities of the
conservative clerics who dominate the judiciary, the military, and legislative
review bodies.
The June protests provided evidence that public anger has risen sharply, and that
anti-government forces are becoming increasingly bold. According to some
reports, demonstrators were heard to chant “Death to Khamenei,” a reference to
Ayatollah Ali Khamenei, who as Supreme Leader holds the highest office of
state power, exceeding that of the head of state and government, President
Khatami.
Shortly after the riots were contained, a group of nearly 250 reformist
intellectuals and writers submitted an open letter, published in the Yas-e-nou
newspaper, calling for Khamenei to resign. In the letter, the reform advocates
asserted that the Iranian people had “the right to fully supervise the action of
their rulers” and that placing “individuals…in the position of divine and absolute
power is a clear heresy towards God.” Worthy as those statements may be, they
run counter to the constitution bequeathed by the leader of the Islamic revolution
in Iran, Ayatollah Khomeini, which specifies, in terms, that the Supreme Leader
can only be supervised by God.
In early July, five reformist legislators issued an appeal to student groups to call
off scheduled demonstrations to mark the anniversary of bloody student protests
on July 9, 1999. The Interior Ministry had previously announced that all
requests for permission to hold rallies had been rejected.
A key element of the planned protests was a sit-in by students from Tehran
University at the UN headquarters in the capital. However, the students
announced the cancellation of the event on the morning of July 9.
Several members of the Central Council of Allameh faction of the Office for
Fostering Unity (the leading reformist student organization) held a news
conference stating that they had submitted a letter to UN Secretary-General Kofi
Annan detailing instances of human rights violations by the government and
calling on the international community to exert pressure to bring an end to the
unjust treatment of opponents of the clerical establishment.
According to Reza Amerinasab, a spokesperson for the Central Council of
Allameh, the sit-in was called off after the students received a positive response
from the UN.
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However, other representatives of the Office for Fostering Unity claimed that the
protests were cancelled in response to a massive security clampdown in which
hundreds of police and security personnel ringed the university campus,
accompanied by dozens of the club-wielding vigilantes who make a habit of
violently disrupting anti-government demonstrations. The decision to call off
the sit-in came shortly after the arrest of three student leaders who held a press
conference that morning.
But violence was not entirely averted, as the abduction of students by vigilantes
touched off three-way street battles as police moved to intervene. Overall,
sporadic demonstrations were reported in six areas of Tehran, as well as several
other cities.
Reformist Resignations
The student-led unrest, which has drawn the rhetorical support (and, according to
some reports, financial assistance) from the US, has increased pressure on
reformists in the government to lead from the front. Reformists and
conservatives alike are mindful of the US role in the downfall of the government
headed by President Mohammad Mosaddeq in 1953, and in light of recent events
in neighboring Afghanistan and Iraq, have become understandably sensitive
about any hint of US interest in the country’s domestic political situation.
The added danger for the reformists is that the mere threat of US intervention
holds the potential to stir nationalist sentiment that could push the population
into the embrace of the hard-liners, who maintain a dogmatically anti-US
posture.
The limits on the reformists’ freedom of action were made clear in mid-July,
when Khatami suggested that he would resign if that is what the Iranian people
desire. The president has frequently hinted at resigning over his inability to push
through the democratic reforms he promised during the 1997 election campaign,
this marked the first time he had publicly raised the possibility.
Although Khatami has so far not made good on his threat/offer to resign, another
high-profile reformist, Minister of Science, Research, and Technology Mostafa
Moin, submitted his resignation to the president in late July. In his letter of
resignation, which Khatami finally accepted in August, Moin decried the
“poisoned political climate” created by the hard-liners and expressed his
displeasure with the mass arrests of students in the wake of the June riots.
Moin had previously handed in his resignation following the crackdown on
students in 1999, but Khatami refused to accept it.
Moin’s resignation has fueled speculation that other reformists will follow suit.
Although none has yet done so, the press reported on August 21 that Abdollah
Ramezanzadeh, the chief presidential spokesperson, planned to step down as a
protest move. The rumors were subsequently denied by Ramezanzadeh, who
remains in his post, although some suspect that he did submit his resignation, but
withdrew it when Khatami refused to accept it.
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Democratic Accountability
That is not to say that the reformists are merely biding their time as they choose
an opportune moment to jump ship. Interior Minister Abdolvahed Musavi-Lari,
for one, has already begun laying the ground for the next round of confrontation
with the conservatives.
Two legislative measures submitted by Khatami in late 2002 and approved by
parliament earlier this year call for the abolition of the Guardian Council to vet
candidates for public office on the basis of their adherence to Islamic beliefs and
loyalty to Ayatollah Khamenei and authorize the president to overturn court
verdicts viewed to be in violation of the constitution. The Guardian Council
rejected both bills, but Musavi-Lari has taken it upon himself (presumably with
Khatami’s blessing) to assert the government’s control of electoral lists by other
means.
In August, the interior minister issued a dire warning about the future of
democracy in Iran, noting that turnout for city council elections held in late
February drew a turnout as low as 12% in some districts. Musavi-Lari proposed
that the troubling level of voter apathy resulted directly from the Guardian
Council’s disqualification of many reformist candidates, which left voters with
no real choice in elections. As such, he proclaimed that it was his ministry’s
duty to the nation to revise the election lists to include qualified candidates
rejected on purely political grounds, and that he was prepared to do so.
The Guardian Council objecting, pointing out that the Interior Ministry had no
constitutional authority to take the action proposed by Musavi-Lari, and should
he carry out his threat, the interior minister would be in violation of the law.
However, Musavi-Lari is undeterred. In August, he ordered the closure of local
offices set up by the Guardian Council to screen candidates for the 2004
legislative elections, claiming that the establishment of the supervisory offices,
which are intended to help the Guardian Council get a read on the views of
prospective candidates, have not been approved by either the Supreme
Administrative Council or parliament, and so are illegal.
Conservatives Propose a Compromise
The interior minister’s bold move appears to have at least partially achieved its
goal, as the Guardian Council was reported to have offered a compromise to
President Khatami in early September. According to Vice President Mohammad
Ali Abtahi, Guardian Council leader Ayatollah Ahmad Jannati agreed to approve
the bill on presidential powers if the bill regarding the approval of candidates
was withdrawn.
Khatami, who in August stated that the survival of the Islamic republic at a
minimum depended upon the implementation of both pieces of legislation,
rejected the offer. According to sources close to the president, Khatami views
the election reform as the more important of the two, and is not willing to give
ground on the issue.
The fact that the hard-liners even considered a compromise is important for a
number of reasons. First, the decisions of the Guardian Council are theoretically
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based on the conformity of legislation with Islamic teaching. Having rejected
the election bill on that basis, the subsequent offer to put the measure back on
the table raises questions about the theological validity of the Guardian
Council’s initial action.
Second, the offer may encourage parliament to go over the Guardian Council’s
head, appealing the matter to the Expediency Council and, if not satisfied with
the outcome, to Khamenei himself. Although justifiably lumped in with the
hard-liners, Khamenei has in the past exhibited a pragmatic streak when it comes
to political disputes that threaten general stability. If the issue of the electoral
reform is thrown in his lap, he could prove more flexible on the matter than the
Guardian Council, which, after all, can hardly be expected to take the broader
view when dealing with a direct threat to its own power.
Finally, the Guardian Council’s offer indicates that the hard-liners recognize that
the reformists cannot simply be ignored, suggesting that the weakness of
Khatami and his allies may be more apparent than real. In that regard, pressure
from the US and other international quarters is a factor. While the threat of US
intervention poses special near-term political difficulties for the reformists, the
conservatives know full well that in the event that the threat becomes reality,
their chances of survival would be better if the reformists were at their side,
rather than on the sidelines.
External Conflict
United States
The chances of direct intervention by the US in the foreseeable future are slim,
not least because of the many difficulties that the coalition forces led by the US
and the UK are encountering in Iraq. That said, officials in Washington have
kept up a steady barrage of accusations against the Iranian government, ranging
from charges that Tehran is supporting the anti-coalition insurgency in Iraq to
claims that the government is seeking to develop nuclear weapons, allegations
that in the current international climate can accurately be described as fighting
words.
Of all the charges, the accusation that Iran is developing nuclear weapons holds
the greatest potential for becoming a rationale for military action. In July, the
British newspaper, The Guardian, reported poll data indicating that a majority of
Americans would support a war against Iran in necessary to prevent Tehran’s
development of nuclear military capacity.
For its part, Iran claims its nuclear program is intended purely for non-military
purposes. However, officials in the Bush administration contend that such
assertions are a smokescreen for a weapons program that is fairly far along in
development.
The nuclear issue took on a new sense of urgency following the publication of a
report in the Los Angeles Times in early August that asserted Iran is in the final
stages of developing a nuclear weapon. According to the article, based on a
three-month investigation of sources that included previously secret documents,
international officials, independent experts, and Iranian exiles, uranium samples
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taken by weapons inspectors in June tested positive for enrichment levels
consistent with use in a nuclear weapon. Simultaneously, a team of lawyers
from the International Atomic Energy Agency (IAEA) began talks with Iranian
officials aimed at securing Tehran’s signature on the Additional Protocol to the
Nuclear Non-proliferation Treaty, which would authorize snap inspections. Iran
agreed to sign the protocol and allow unfettered access to its nuclear program,
but only after the lifting of sanctions that block its access to advanced nuclear
technology.
Responding to the allegations reported in the Los Angeles Times, White House
Spokesman Scott McClellan announced that the US government is working with
the International Atomic Energy Agency to “make sure that [Iran does] not
continue on this course, which is unacceptable.” The US has been pressuring
the IAEA to declare Iran in violation of the Nuclear Non-proliferation Treaty,
but the nuclear watchdog has been resistant. An IAEA report released in June
cited a number of failures in Tehran’s reporting of its nuclear activities, but
stopped short of confirming the existence of a weapons program.
Iran shows little sign of backing down under pressure from the US. In midAugust, brushing aside the international criticism and suspicion, the country’s
Supreme Nuclear Energy Council approved the construction of a second nuclear
reactor. Meanwhile, the IAEA has ordered a full report of inspectors’ findings in
preparation for meetings in September.
Iraq
Another potential source of conflict with the US stems from charges by officials
in Washington that Iran is actively working to undermine the efforts of coalition
forces in Iraq to promote stability in the occupied country. However, the flipside of Iran’s acknowledged capability to hinder US reconstruction plans is that
Tehran’s influence with leaders of Iraq’s Shi’ite majority also could go a long
way toward making the process unfold more smoothly.
In an apparent reflection of that fact, the US announced in mid-August that it had
shut down the Washington offices of Mujahadeen e Khalq (MEK), an Iranian
opposition group that until April 2003 had operated in Iraq under the protection
of Saddam Hussein’s regime, and the National Council of Resistance of Iran,
which the US State Department contends is little more than the MEK’s alias.
The MEK has carried out terrorist attacks inside Iran and is included in the US
State Department’s list of terrorist organizations.
The US move, which was praised a “positive” and “overdue” by Iran’s Foreign
Ministry, came just two weeks after reports surfaced that US representatives
were secretly meeting with Iranian officials to negotiate the handover of
suspected al-Qaida members who the Iranian government claims to have in
custody.
According to a report by NBC News in the US, the Bush administration even
offered to exchange MEK suspects for the al-Qaida operatives, one of whom is
reported to be Osama bin Laden’s son, Saad. The Bush administration has
denied the reports of secret negotiations, and publicly has insisted that Iran turn
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over the suspected terrorists for questioning without conditions. However, Iran
has refused to comply, citing the absence of an extradition treaty with the US.
In an obvious effort to foreclose any attempt by Washington to apply pressure by
insinuating that the Iranian government is in reality harboring the al-Qaida
operatives, officials in Tehran announced in mid-August that they had foiled an
al-Qaida plot to carry out attacks on Iranian soil. Although the news was greeted
with substantial skepticism in international quarters, the historical basis for
animosity between Iran and al-Qaida is rock solid, given Tehran’s hostility
toward the former Taliban regime in Afghanistan, which played host to bin
Laden’s terrorist network for several years.
Outlook
President Khatami and the reformists in parliament are effectively fighting a
three-front battle for their political survival, domestically against both the hardline clerics and advocates of secular democracy, and internationally against the
US. In the reformists’ favor, the conservatives are in no position to make
common cause with either the US or student-led activists, who would be even
less enamored of a government fully dominated by the hard-liners.
In fact, as strange bedfellows' arrangements go, the most likely one to emerge is
an alliance of the reformists and the conservatives to protect the authority of the
clerical establishment from attacks by secular and foreign forces. Such an
outcome, the probability of which rises in step with the pressure applied by the
US, would seriously undermine the prospects for the peaceful introduction of the
political and social liberalization that the Iranian people have been promised
since 1997.
Avoiding that development will require a clear victory by the reformists over
their hard-line rivals. The restoration of a general sense that change is possible
would significantly reduce the chances that forces favoring secularization might
be able to attract the broader following that would be necessary to carry out a
social and political revolution.
At the same time, were the reformists able to bring the hard-liners to heel, the
chances would be good that future elections would yield results similar to those
in the 2000 parliamentary elections and the presidential elections in 1997 and
2001, when reformists scored landslide.
With legislative elections scheduled to be held in February 2004, time is running
out for Khatami and his reformist allies.
*
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*
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IRAQ
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
34.0
31.0
26.0
45.5
V.High
Current
09/03
41.5
22.5
20.0
42.0
V.High
One Year
Ahead
Worst
Best
Case
Case
38.0
49.5
20.0
27.0
20.0
30.0
39.0
53.3
V.High High
Five Years
Ahead
Worst
Best
Case
Case
30.0
68.0
25.0
40.0
20.0
37.0
37.5
72.5
V.High Low
POLITICS
The US-led coalition in Iraq has enjoyed only mixed success in its efforts to
repair the country’s infrastructure, revive economic activity, and lay the
foundation for the eventual transfer of political control to a democratically
elected Iraqi government. The Coalition Provisional Authority (CPA) has made
some tangible progress toward forming a viable democratic state from the ashes
of Saddam Hussein’s autocratic regime, and conditions have remained fairly
stable in the north and south of the country.
However, a continuing campaign of deadly harassment from guerrilla fighters
and a series of bombings in recent weeks, which points to the emergence of a
more coordinated effort to undermine reconstruction plans, have raised serious
doubts about the ability of the occupying forces to maintain general stability
without a significant increase in manpower, money, and supplies.
President George W. Bush, whose administration is facing political pressure at
home over a mounting budget deficit, has as much as conceded that the US
cannot afford its makeover of Iraq without substantial support from other world
powers, and has approached the UN for help. Whether Washington’s appeals
will receive a positive response from France, Russia, and Germany—all of which
raised strenuous objections to US plans for war in early 2003—remains in doubt,
raising important questions about the medium-term prospects for stability in Iraq.
Government Stability
Under the leadership of the US Chief Administrator L. Paul Bremer, the CPA is
laying the foundation for new political institutions and government structures.
An Iraqi Governing Council (IGC) was established on July 13, and will oversee
the post-war reconstruction as an interim government until conditions permit the
holding of elections and the transfer of full political control to Iraqi nationals.
As originally envisioned, the IGC was to be nothing more than a toothless
consultative group, but during negotiations for the creation of the body, Iraqi
leaders and Sergio Vieira de Mello, the UN representative in Iraq, persuaded
Bremer that the IGC needed some real power if it was to have any credibility.
Bremer eventually agreed, and although he retained a veto on all of the Council’s
actions, the IGC was given responsibility for choosing Cabinet ministers,
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approving the 2004 budget, and organizing an assembly to write the country’s
new constitution. Once the constitution is written, the IGC will be responsible
for organizing both a referendum to approve the document and, assuming the
constitution is approved, national elections to choose a permanent representative
government.
On September 1, Ibrahim Jafari, senior leader of the IGC, swore in the 25
members of the first post-Saddam Cabinet. Like the 25-member IGC, the
Cabinet includes 13 Shiite Muslims, five Sunni Muslims, five Kurds, one ethnic
Turk, and one Assyrian Christian, reflecting the composition of the Iraqi
population. The full roster of Cabinet ministers, along with their religious/ethnic
affiliation, is as follows:
Post
Agriculture
Communications
Construction and Housing
Culture
Minister
Abdul-Ameer Abboud Rahima
Haider al-Ebadi
Bayan Baqir Solagh
Mofeed Mohammed Jawad alJazaeri
Education
Alaudin Abdul-Saheb al-Alwan
Electricity
Ayham al-Samaraie
Environment
Abdul-Rahman Sidiq Kareem
Finance
Kamil Mubdir al-Gailani
Foreign Affairs
Hoshyar Zebari
Health
Khudayer Abbas
Higher Education
Zeyad Abdul-Razzaq Mohammed
Aswad
Human Rights
Abdul-Basit Turki
Immigration and Refugees Mohammed Jassem Khudair
Industry and Minerals
Mohammed Tawfik Raheem
Interior
Nori al-Badran
Justice
Hashim Abdul-Rahman al-Shibli
Oil
Ibrahim Mohamed Bahr al-Uloum
Planning
Mahdi al-Hafidh
Public Works
Nesreen Mustafa Sidiq Berwari
Science and Technology
Rashad Mandan Omar
Sport and Youth
Ali Faik al-Ghadban
Trade
Ali Adbul-Amir Allawi
Transport
Behnam Zayya Polis
Water Resources
Abdul-Latif Rashid
Work and Social Affairs
Sami Izara al-Majoun
Affiliation
Shiite
Shiite
Shiite
Shiite
Shiite
Sunni
Kurd
Sunni
Kurd
Shiite
Sunni
Sunni
Shiite
Kurd
Shiite
Sunni
Shiite
Shiite
Kurd
Turkoman
Shiite
Shiite
Christian
Kurd
Shiite
Signs of Discord
While the formation of the IGC and the Cabinet are undeniably positive steps,
even here the potential for future problems is abundantly evident. Although the
IGC had little trouble reaching agreement on its first official decision, which was
to declare April 9, the anniversary of Saddam’s fall from power, a national
holiday, other decisions have been delayed by deep divisions among the body’s
members.
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When the IGC attempted to elect a president from among its members, it found it
could not reach consensus, and instead it settled on a system of rotating the
presidency among nine members. Likewise, the naming of the Cabinet was to
have been one of the IGC’s first orders of business, but the process took six
weeks.
Democratic Accountability
Moreover, the IGC lacks credibility among the population on a number of
counts, and some members have already begun to express frustration over that
fact. Although the IGC has been granted some power, ultimate authority rests
with Bremer. In response to criticism of the slow pace of decision-making, IGC
member Mahmoud Othman complained, “[The Americans] have all the
executive powers in this country. The budget belongs to them, security belongs
to them, and then they ask us to deliver. How should we deliver?”
In addition, the majority of IGC members are former exiles who are favored by
the US but have little or no base of support among Iraqis. A prime example is
Ahmed Chalabi, the head of the formerly London-based Iraqi National Congress
(INC), who has is apparently much admired by the US, which reportedly regards
him as a possible candidate for Iraq’s first “democratically” elected president.
Unfortunately, Chalabi is a convicted crook and fraudster, having been sentenced
in Jordan in 1992 to 22 years hard labor for embezzlement, fraud and currencytrading irregularities during his tenure as chairman of Petra Bank in the kingdom
in the 1980s. Chalabi managed to skip the coutnry well before legal proceedings
were opened against him. However, it was reported in August this year that
mvoes were afoot in Jordan’s parliament to demand the government take legal
steps to seek Chalabi's extradition.
Internal Conflict
Concerns about political infighting and doubts about the popular support enjoyed
by the IGC have so far taken a back seat to a more immediate and troubling
problem, namely, the general success of efforts by armed opposition groups to
disrupt reconstruction efforts, and thereby raise the financial and human costs of
the US-led attempt to plant democracy in the inhospitable soil of the Middle
Eastern desert.
Almost from the moment President Bush declared an end to major hostilities on
May 1, guerrilla attacks on coalition forces have produced a steadily mounting
death toll. In fact, more soldiers have been killed since the beginning of May
than died in battle during the six-week war that began on March 19.
In military terms, the killing of a few dozen American soldiers does not make a
significant dent in the 140,000-strong military force currently in Iraq. However,
the purpose of the attacks is psychological, aimed at eroding morale among the
coalition forces, undermining support for the war in the US, and creating such a
level of uncertainty about exactly who is the enemy that tragic mistakes become
inevitable, in the process destroying whatever trust exists between the occupiers
and the occupied.
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Bombings
It was initially believed that the attacks were the work of whatever remained of
Saddam’s elite Republican Guard and Ba’ath Party, and the death of Saddam’s
reviled sons, Uday and Qusay, at the hands of US forces on July 22, brought
some hope that the attacks against military personnel would subside. Instead, the
killings have continued with chilling regularity.
More recently, resistance efforts have expanded to include a second, more
sophisticated, strategy of bombing attacks on vital infrastructure and high-profile
international targets, including the Jordanian embassy and the UN headquarters
in Baghdad. Small cells of fighters have bombed oil installations and water
pipelines, creating delays in the promised economic improvement and
exacerbating the hardship endured by a population dealing with the stifling heat
of the Iraqi summer.
The August 13 attack on the UN headquarters, in particular, was clearly aimed at
sending the message that the perpetrators can hit any target of their choosing at
will, and seriously undermined confidence in the ability of the occupying forces
to ensure the security of the population. In that regard, matters were not helped
by INC leader Chalabi’s revelation that the IGC had received prior warning of
the attack, and had passed the information on to the Americans.
As for exactly who is responsible for the deadly attacks, there remains
substantial uncertainty. Following the UN bombing, Bremer named three groups
as the likely culprits—Ba’athist supporters of Saddam Hussein, the Iraqi Ansar
al-Islam organization, or foreign Islamist extremists. Some terrorism experts
have claimed that the bombing bore the marks of al-Qaida.
Militant Islam
Moreover, it is not clear whether the shootings, sabotage, and terrorist bombings
are being carried out as part of a coordinated effort, or are the work of separate
entities operating independently of one another. If they are connected, the level
of coordination would indicate that the US-led forces are dealing with an enemy
whose ranks are not limited to the holdouts from Saddam’s regime. If they are
not connected, that raises the troubling proposition that the occupying forces
face a battle against multiple enemies, possibly including secular nationalists,
Iraqi fundamentalists, and foreign jihadists.
There are growing signs that Iraq has become the new battleground for jihadists
from across the region. Extremist fighters have apparently responded to appeals
from al-Qaida leaders to support the resistance to Western occupation of Iraq.
Some 3,000 Saudi men have gone missing in recent weeks, and are believed to
have made their way into Iraq to join the resistance. A coalition attack on a
guerrilla training camp in mid-June left at least 70 non-Iraqi combatants dead.
Among those killed were fighters from Saudi Arabia, Yemen, Syria, Sudan, and
Afghanistan.
Religious Tensions
The most troubling incident yet occurred in late August, when a car bomb was
detonated at one of the holiest Shi’ite shrines in Iraq, the Imam Ali mosque in
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Najaf. The bombing killed more than 120 people, including Mohammed Baqer
al-Hakim, a prominent Shi’ite cleric and the leader of the Supreme Council for
Islamic Revolution in Iraq (SCIRI), a key player in the Iraqi political coalition.
Al-Hakim’s brother, Abdel-Aziz al-Hakim, is a member of the IGC.
Shi’ite leaders immediately attributed the attack to Sunni extremists, but many in
Najaf believe the bomb was planted by Saddam loyalists seeking to sow dissent
among the country’s Muslims. Several days after the bombing of the Imam Ali
mosque, gunmen opened fire inside a Sunni mosque in Baghdad. Again, the
affiliation of the attackers was unclear, and alternative theories hold that the
shooting was either carried out by Shi’ite militants in retaliation for the bombing
or by Saddam loyalists seeking to give the appearance of a revenge attack.
According to foreign correspondents on the scene, tensions between Shi’ite and
Sunni Muslims have been running high since the Najaf bombing, and there is
widespread fear that the two groups are headed toward open warfare.
Moreover, there is a danger that religious hostility could be turned on the
coalition forces, a threat that is reinforced by reports that Iraqi Shi’ite groups
have armed themselves for defense purposes. Lebanon’s top Shi’ite cleric,
Grand Ayatollah Sheikh Mohammed Hussein Fadlallah, has warned that Iraq’s
Shi’ite population will join the resistance to the US-led occupation if it is not
ended quickly, and there are reports that Iraqi Shi’ite groups have already begun
arming themselves for defense purposes. One young Shi’ite cleric, Moqtada alSadr, has amassed a large and growing following with his fiery speeches against
the occupation.
If the US-led military forces fail to provide improved security, an ever-larger
section of the population could come to see their presence as the cause of the
problem, rather than the source of a solution.
Economic Reconstruction
As the US confronts the inescapable conclusion that conditions could run out of
control without additional forces, the Bush administration has been warned that
the cost of maintaining the current force may not be sustainable without outside
help. In early August, the nonpartisan Congressional Budget Office (CBO)
released a report stating that military operations in Iraq would cost between $8
billion and $29 billion, without taking into consideration reconstruction costs.
According to Bremer, reconstruction costs stand to tack another $100 billion
onto the total bill. Currently, overall US spending on Iraq is creeping close to $4
billion a month.
The Bush administration’s confident assertions that reconstruction could be
financed with revenues from the sale of Iraqi oil have proven to be unfounded,
largely owing to repeated sabotage of the country’s northern pipeline, which
prior to the war was pumping about one million barrels of oil daily, and security
concerns that have prompted foreign oil interests to adopt a cautious approach in
Iraq.
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Since the northern pipeline was brought back on line after a four-month hiatus in
July, oil flows from the fields around Kirkuk to the Turkish port of Ceyhan have
been halted by four bombing attacks. The US is increasing security, but it is
impossible to police every meter of pipeline.
Most of Iraq’s oil is still produced in the south, where production has resumed
with only occasional interruptions due to looting of vital parts. However,
quantities remain low; by early September, daily output was only about one-half
of the pre-war level of two million barrels.
Given the difficulties, Bremer has estimated that output will probably not return
to pre-war levels until late in 2004. That means that most of money to pay the
steep price for Iraq’s reconstruction will continue to come out of the pocket of
American taxpayers, making the project highly controversial back in the US,
where the Bush administration is gearing up for a re-election campaign.
External Conflict
Facing a financial commitment it cannot afford as the US budget deficit
continues to grow by leaps and bounds, the Bush administration has sought
assistance, in terms of both manpower and money, from the international
community. In late August, US Deputy Secretary of State Richard Armitage
announced that US officials were open to the creation of a UN-sponsored
multinational force under unified (read US) command, a move aimed at
convincing reluctant potential allies to contribute troops to the reconstruction
effort.
In early September, the US submitted a draft resolution to the UN Security
Council, calling for:
•
•
•
•
a multinational force, under unified command, to contribute to “the
maintenance of security and stability” in Iraq
UN endorsement of the IGC “as the principal body of an Iraqi
interim administration” and support for its Cabinet appointees
the participation of delegates from the US and the UN to assist the
IGC in developing “a timetable and program for the drafting of a
new constitution for Iraq and of the holding of democratic elections”
assurances from the UN secretary-general that the resources of the
UN will be made available, if requested by the IGC, to help establish
an electoral process.
The draft resolution also reaffirms the “vital role” to be played by the UN in
providing humanitarian relief, promoting economic reconstruction, and
advancing efforts to restore and establish nations and local institutions in Iraq.
Early responses of the 15 Security Council members to the resolution were
mixed, with the strongest reservations expressed by France, Germany, and Syria.
However, even France—which strenuously resisted US efforts to win UN
authorization to launch a war on Iraq and wields veto power as a permanent
member of the Security Council—accepted the draft as a basis for negotiations.
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Those negotiations will not be easy for the US, which approaches the UN from a
position of obvious weakness. The sticking points are likely to be Washington’s
continued insistence on retaining administrative as well as military control,
concerns among Security Council members about the implications of giving the
UN’s stamp of approval to an interim government that was hand-picked by the
US, and the absence of a specific time frame for the holding of elections and the
end of the occupation.
Grumbling at the Top
All indications are that the US does not have the luxury of time as it begins its
negotiations with the UN. Evidence of growing tensions is everywhere in Iraq,
including the highest levels of government. In early September, Mohammed
Bahr al-Uloum, a senior member of the IGC, resigned to register his
dissatisfaction with US efforts to establish order and security in the country.
Another IGC member, Abdel-Aziz al-Hakim, made a public call for the US to
end the occupation shortly before the funeral for his brother, former SCIRI
leader Mohammed Baqer al-Hakim, who was killed in the Najaf bombing.
Meanwhile, Chalabi has publicly proclaimed his opposition to the expansion of
the foreign military presence in Iraq, arguing (against all available evidence) that
the current US-led force was sufficient to ensure stability. It is not difficult
dismiss the conclusion that Chalabi’s real concern is that the internationalization
of the post-war effort will dilute the authority of his benefactors in Washington,
leaving his political future in the hands of leaders who are far less enamored of
him than the hawks in the Bush administration.
Regardless of his motivation, the fact that outspoken opposition to US post-war
strategy is coming even from Chalabi—a man who has no axe to grind with the
Bush administration and whose political actions are to all appearances
determined almost entirely by personal ambition—is a fairly good indication that
anti-US sentiment is running fairly high throughout the interim administration.
*
*
*
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ISRAEL
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
60.0
37.0
33.5
65.3
Mod.
Current
09/03
67.5
39.5
38.0
72.5
Low
One Year
Ahead
Worst Best
Case
Case
56.0
68.0
34.0
40.0
30.0
36.0
60.0
72.0
Mod.
Low
Five Years
Ahead
Worst Best
Case
Case
54.0
75.0
32.0
40.0
30.0
40.0
58.0
77.5
High
Low
POLITICS
Internal Conflict
The US-sponsored plan for peace between Israelis and Palestinians is in tatters
following the collapse of a fragile truce in mid-August and the eruption of a
power struggle among leaders on the Palestinian side. The faint hope that
President George W. Bush’s roadmap for peace might produce a lasting
resolution of the seemingly intractable conflict has been replaced by a widely
felt fear of a new and even more deadly round of violence is in the offing.
The cease-fire demanded by Israel as the prerequisite for restarting the peace
process held reasonably well for six weeks. While the Israeli government did
not formally reciprocate the militants’ declaration of a cease-fire in late June, it
had reduced its military presence in the West Bank and Gaza, and was in the
process of negotiating the withdrawal of its military forces from key Palestinian
towns when the truce was shattered.
But the violence never subsided completely, and tensions continued to run high
throughout July and August. The level of acrimony between the two sides is
such that even gestures intended as a sign of goodwill can become a new source
of confrontation. Such was the case when Israel’s announcement that it would
free several hundred Palestinian prisoners touched off street demonstrations
protesting the detention of some 6,000 Palestinians in Israeli jails.
Another bone of contention is Israel’s construction of a security fence that in
some places is routed deep into Palestinian territory, although not deep enough
to satisfy some of the right-wing members of the Israeli government. The fence
provides a semi-permanent marker of the government’s failure to comply with its
obligation under the peace plan to dismantle all Jewish settlements constructed
in the West Bank since 2001.
In July, US Secretary of State Colin Powell said of the fence, “we [the US
administration] have problems with it.” Powell further intimated that failure to
address Palestinian concerns over the issue might require the US to take punitive
measures, such as withholding part of a package of $9 billion in guaranteed
loans. Sharon agreed, at least in principle, to reroute the fence, but by midAugust there was little to indicate that Israel was complying.
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While such matters aggravated the situation, it was the Israeli government’s
continued implementation of a policy of targeting the leaders of militant groups
for assassination and sporadic terrorist attacks by members of Hamas and Islamic
Jihad that ultimately proved decisive in the breakdown of the cease-fire.
Tit-for-Tat Murder
The seemingly inexorable march away from peace began on August 8, when two
Hamas commanders were killed in an Israeli raid on an alleged bomb-making
facility in Nablus. The militants vowed revenge, which they exacted four days
later by means of a bombing attack on soldiers near the West Bank settlement of
Ariel. That same day, a renegade faction of Palestinian Authority (PA) President
Yasser Arafat’s Fatah carried out a separate attack on a shopping mall in the
town of Rosh Ha’ayin, in central Israel.
The Israelis showed commendable restraint following the two bombings, but
further trouble became all but inevitable when Ahmed Sidr, the Islamic Jihad
commander in Hebron, was killed on August 14 in a firefight with Israeli
soldiers. Islamic Jihad threatened retribution “like an earthquake.”
The seismic event turned out to be the suicide bombing of a Jerusalem bus on
August 19, in which 22 people, including six children, were killed, and more
than 100 were injured. Although both Islamic Jihad and Hamas initially claimed
responsibility for the attack, it appears to have been the work of Hamas.
In any case, Israeli opponents of the peace process on the political right pointed
to the bombing as confirmation of their contention that the cease-fire was never
more than a ruse by the militants to gain some political cover under which to
regroup and rearm. Prime Minister Ariel Sharon, who has been viewed as a
veritable dove compared to members of the right-wing parties on which his
government depends for its majority, summed up the perspective bluntly, stating,
“The Palestinians never weaned themselves from the basic desire to murder
Jews. This was always Arafat’s policy—simultaneous negotiations and
terrorism.”
In light of the prime minister’s expressed views, the official Israeli response to
the Jerusalem bomb attack came as no real surprise. On August 20, the Israeli
government announced that all contact with the militants would end.
Meanwhile, Israeli military personnel were redeployed in force to the Palestinian
territories in the West Bank and at checkpoints in the Gaza Strip, as the Israeli
government issued a virtual declaration of war against the militants.
On August 21, following the assassination of Hamas co-founder Ismail Abu
Shanab, who was widely viewed to be a moderate within the group and a
proponent of peace, both Hamas and Islamic Jihad renounced the cease-fire,
effectively putting the peace process on indefinite hold.
Palestinian Power Struggle
Subsequent efforts by the PA to salvage the peace process merely underscored
the powerlessness of Palestinian officials to rein in the militants. The
Palestinian government ordered a crackdown on Hamas and Islamic Jihad, and
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Palestinian security forces conducted raids on suspected organizers of the
Jerusalem bombing. However, sources reportedly close to Prime Minister
Mahmoud Abbas’ inner circle expressed concern that a meaningful clampdown
held the threat of provoking a civil war among the Palestinians.
US Secretary of State Colin Powell appealed to Abbas and Arafat to preserve the
roadmap by persuading the militants to declare a new cease-fire. Arafat
responded by asserting that the exercise would be pointless in the absence of
reciprocal measures by Israel, including the cessation of its policy of
assassinations and a formal cease-fire pledge.
When it became clear that Arafat was not about to strain himself in the interest
of peace, Abbas called upon the president to surrender his control over
Palestinian security forces, which Arafat partially retained in a government
reorganization carried out in May 2003 that saw Abbas’ installed in the newly
created post of prime minister. Arafat became more assertive in late August,
calling on Hamas and Islamic Jihad to end their campaign of violence, but only
after Abbas convened a special meeting of his Cabinet to formulate a plan to
wrest authority from the president.
The struggle between the two leaders ultimately spelled the end of Abbas’ shortlived tenure in power in early September. Declaring that infighting was
deterring progress toward peace, Abbas issued an ultimatum to the Palestinian
legislature, demanding that they support him and grant him the authority
required to fulfill the PA’s obligations under the roadmap, or strip him of his
office.
Having forced the Palestinians to choose between him and Arafat, the outcome
was not difficult to predict. The creation of the prime minister’s post and the
choice of Abbas to fill it both reflected the desire of the US to devise a means of
overcoming Israeli objections to negotiating directly with Arafat without actually
courting heightened instability in the PA by removing the Palestinian leader from
power. Under the circumstances, it should hardly have been surprising that
Abbas was never able to shake the perception that he was a puppet of the US
and, by proxy, of Israel.
On September 6, Abbas submitted his resignation to a closed session of the
parliament. Expressing deep bitterness over Israel’s bad faith, he also took
parting shots at the US, which he accused of failing to adequately pressure Israel
to comply with the terms of the roadmap, and Arafat’s supporters, whom he
criticized for sabotaging peace efforts in the name of narrow political interests.
Outlook
Where things go from here is far from certain. Sharon has made clear that his
government will not hold talks with Arafat or any prime minister controlled by
him.
The problem is that it falls to Arafat to nominate Abbas’ replacement, and he is
unlikely to choose someone who poses a threat to his authority, except under
pressure from outside. Thus, there is a Catch-22 situation: a compliant prime
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minister will be unacceptable to Israel, while an independent premier will find it
difficult, if not impossible, to dispel perceptions that he is subservient to the US
and Israel.
The Israeli right-wing’s solution to this dilemma is to eliminate Arafat from the
equation altogether. Members of the Israeli Cabinet have reportedly put forward
proposals in that vein, ranging from deportation to a bombing strike on the PA
president’s Ramallah headquarters, where he has been held in virtual
imprisonment for the past 20 months. However, the US has issued an
unambiguous warning that Israel is not to take any action against Arafat.
On the Israeli side, the government’s stepped up efforts against the militants
point to a resumption of the incessant violence that Israelis and Palestinians alike
have endured since the initiation of the second intifada in September 2000. Even
as world leaders bemoaned the implications of Abbas’ resignation for peace
hopes, Prime Minister Sharon shrugged it off as “an internal Palestinian
matter,” before announcing that Hamas leaders are “marked for death” and will
not be given a moment’s rest.
Meanwhile, an unsuccessful attempt to assassinate Hamas spiritual leader Sheikh
Ahmed Yassin, who was slightly injured in an aerial strike on an apartment
building in Gaza City, brought an ominous warning from Hamas, which declared
that Israel had “opened the gates of hell” and that the attack would bring
reprisals “of a kind Israel has not seen before.”
ECONOMY
While Prime Minister Sharon grapples with the political repercussions of the
collapse of the peace process, his chief rival in the governing Likud party,
Finance Minister Binyamin Netanyahu, will be kept busy trying to minimize the
damage to the country’s battered economy. In May, Netanyahu won approval of
a package of reforms aimed at trimming a fiscal deficit that grew to 4% of GDP
in 2002 and invigorating an economy that has contracted in each of the last two
years as the climate of violence has constrained economic activity.
The reforms—which include a reduction in the top income tax rate from 60% to
49%, deep cuts to social programs, an increase in the retirement age, and a
privatization program targeting utilities, banking, and other key sectors—
represent a frontal assault on an expansive welfare state that is a vestige of
Israel’s socialist roots. In response to widespread protests over the reforms,
some of which were implemented as early as July, Netanyahu conceded that they
will create significant short-term hardship, but that the economy will show signs
of renewed vigor by the second half of 2004.
The market response came far more quickly, as the stock market climbed 50% in
the first half of 2003, while the currency has gained in value by 10%. During the
April-June quarter, investment in the pivotal high-tech industry, most of it from
foreign sources, grew by 70%, indicating renewed interest in a sector that was
battered by the near simultaneous bursting of the dot-com bubble and the
eruption of the intifada.
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Unfortunately, it is highly doubtful that those signs of improvement can be
sustained in a climate of surging violence, which is what appears to be in the
offing. Although the economy is still expected to show positive growth for the
first time in three years in 2003, there will be little momentum going into 2004,
and further cuts—and more protests—are all but inevitable if the government
intends to meet its target of reducing the budget deficit to 3% of GDP next year.
Israel: Selected Economic Indicators
1998
1999
2000
Domestic Economic Indicators
GDP (Nominal, $bn)
102.82 103.10 113.92
Per Capita GDP ($)
17223
16902
18111
Real GDP Growth Rate (%)
3.0
2.7
7.4
Inflation Rate (%)
5.4
5.2
1.2
2002
111.78
17330
-0.9
1.1
102.70
15537
-1.0
5.6
Budget Revenues ($bn)
Budget Expenditures ($bn)
Budget Balance ($bn)
Budget Balance/GDP (%)
46.72
48.17
-1.45
-1.4
45.71
47.81
-2.10
-2.0
52.15
51.17
0.98
0.9
49.22
53.33
-4.11
-3.7
51.80
55.86
-4.06
-4.0
Change in Real Wages (%)
Unemployment Rate (%)
4.6
8.6
2.8
8.9
5.1
8.8
7.4
9.3
-4.5
10.3
International Economic Indicators
Current Account ($bn)
Current Account/GDP (%)
-1.45
-1.4
-2.04
-2.0
-1.08
-1.0
-2.29
-2.1
-2.14
-2.1
Total Foreign Debt ($bn)
Total Foreign Debt/GDP (%)
Debt Service $bn
Debt Service/XGS (%)
Liquidity (months import cover)
41.60
40.5
6.74
16.2
10.4
43.40
42.1
7.55
16.1
9.0
61.79
54.2
8.87
15.5
8.2
55.67
49.8
7.80
15.6
9.1
56.70
55.2
7.51
15.6
9.3
Currency Exchange Rate
Currency Change (%)
3.800
-10.2
4.140
-8.9
4.077
1.5
4.206
-3.2
4.738
-12.6
*
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2001
*
*
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KUWAIT
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
72.5
48.0
42.5
81.5
V.Low
Current
09/03
78.0
47.5
47.0
86.3
V.Low
One Year
Ahead
Worst
Best
Case
Case
68.0
78.0
43.0
48.0
38.0
48.0
74.5
87.0
Low
V.Low
Five Years
Ahead
Worst
Best
Case
Case
60.0
80.0
45.0
48.0
30.0
48.0
67.5
88.0
Mod. V.Low
POLITICS
Democratic Accountability
Parliamentary elections held on July 5 produced some changes in the
composition of the National Assembly, although not of the variety that had been
anticipated. Prior to the election, groups opposing the tight political control
exerted by the ruling Al Sabah family controlled a majority in the 50-member
National Assembly, with secularist liberals holding 14 seats and Islamic
fundamentalists claiming 20 seats.
As the elections were held on the heels of the overthrow of Iraqi leader Saddam
Hussein by US-UK military forces, the expectation was that either or both of
those groups might make significant gains. The government’s unabashed
cooperation with the US-led effort provided a convenient issue over which both
liberals and Islamists might engage in some exuberant monarchy bashing.
Moreover, the outcome of the war appeared to carry additional benefits for
liberals and Islamists, although in different ways. On the one hand, the very real
threat that Saddam’s regime had posed to Kuwait’s sovereignty had served as a
key justification for the maintenance of tight control by the monarchy, and the
removal of that threat seemed likely to provide a boost to the liberals’ arguments
in favor of greater democracy. On the other hand, the prospect of a long-term
military occupation of a neighboring Islamic country by Western military forces
provided Islamists with an especially meaty campaign issue.
In fact, the liberals suffered a staggering defeat at the polls, as their
parliamentary ranks were reduced to just three members, while the Islamists
gained only a single seat to bring their total to 21. Thus, the anti-monarchy
forces saw their numbers reduced to a total of 24 seats, two short of an outright
majority.
Meanwhile, candidates running on an overtly pro-monarchy platform won 14
seats, and independent candidates representing tribal and local interests won the
remaining 12 National Assembly posts.
Predictably, government officials proclaimed the elections an indication of the
genuine democracy enjoyed by the Kuwaiti people—that is, the 15% of the
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Kuwaiti people who are actually allowed to vote. Barred from participating in
elections are women, anyone under the age of 21, and members of the police
force. Among those eligible to vote, turnout was quite high, estimated at about
80%.
But the government’s opponents charged that the outcome had less to do with the
will of the people than it did with the wealth of the monarchy. According to
reports in the media, the elections were marred by vote buying and vote
transfers. One newspaper published a story claiming that the government
established a secret fund to support pro-monarchy candidates.
Government Stability
New Government
Following the election, Emir Jaber Al-Ahmad Al-Jaber Al-Sabah appointed his
brother, Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah, previously deputy prime
minister and minister of foreign affairs, to head the new government. As is
traditional, the Cabinet is dominated by Al-Sabah family members, although
several key posts, including Commerce and Industry, Justice, and Public Works,
are held by individuals from outside the royal family.
The full Cabinet is as follows:
Post
Minister
Prime Minister
Sabah Al-Ahmad Al-Jaber Al-Sabah
Deputy Prime ministers
Interior
Nawaf Al-Ahmad Al-Jaber Al-Sabah
Cabinet Affairs
Muhammad Dayfallah Al-Sharar
Defense
Jaber Al-Mubarak Al-Hamad Al-Sabah
Ministers
Awqaf & Islamic Affairs
Abdullah Maatouq Al-Maatouq
Commerce & Industry
Abdullah Abdelrahman Al-Taweel
Education
Rashid Hamad Muhammad Al-Hamad
Energy
Ahmad Al-Fahad Al-Ahmad Al-Sabah
Finance
Mahmoud Abdelkhaliq Al-Nouri
Foreign Affairs, Labor & Social Muhammad Al-Sabah Al-Salem Al-Sabah
Affairs
Health
Muhammad Ahmad Al-Jarallah
Information
Muhammad Abdullah Abu Al-Hassan
Justice
Ahmad Yaacoub Baqer Al-Abdullah
Public Works
Bader Nasser Al-Humaidi
Transport & Planning
Ahmad Abdullah Al-Ahmad Al-Sabah
Important changes include the elevation of Sheikh Muhammad Al-Sabah AlSalem Al-Sabah to the post of minister of foreign affairs. Muhammad had
previously served as minister of state for foreign affairs under Sabah. He was
also named as the acting minister of labor and social affairs.
Another key change was the appointment of Sheikh Ahmad Fahd Al-Ahmad AlSabah to head the Ministry of Energy. Ahmad, who served as information
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minister in the previous government, took on the energy portfolio in 2002,
supposedly on a temporary basis, after a scandal involving a deadly explosion at
the Al-Shuaiba oil refinery forced the resignation of Adel Al-Subeih, and several
prospective replacements turned down the job.
Break with Tradition
Without doubt, the most important change was Sabah’s appointment as prime
minister. Traditionally, Kuwait’s head of government has been the crown
prince, a position currently held by Saad Al-Abdullah Al-Salem Al-Sabah.
However, like Emir Jaber, his cousin, Saad is of advanced age (both are in their
70s) and in poor health, reportedly suffering from colon cancer. Saad has been
out of the country receiving medical treatment almost continuously since 1997,
and Sabah, as first deputy prime minister, served as acting prime minister for
much of that time.
Thus, the importance of Sabah’s appointment is mostly symbolic, in that he has
now been granted the authority to go along with the responsibilities of prime
minister. To that extent, the move should help to remove the perception of a
power vacuum at the top, a factor that played an important role in the trouble
Sabah encountered when trying to fill the energy minister’s post back in 2002.
Nevertheless, the separation of the posts of crown prince and prime minister is a
potentially historic event in the country’s political evolution. For years,
democracy advocates have demanded such a move, contending that the heir to
the throne was too powerful to hold a post that is theoretically accountable to the
National Assembly. While Sabah is currently second in the line of royal
succession, his chances of actually becoming emir are rather slim, and so he can
be expected to be less immune that was Saad to criticism from within the
legislative chamber.
Moreover, Sabah is generally perceived to be more supportive than either Jaber
or Saad of an enhanced political role for the elected parliament. Having been
granted legitimate claim to both the title and the powers of the prime minister, he
will now be in a position to do something about it.
Succession
At the same time, the elevation of Sabah to the prime minister’s post is certain to
reinvigorate debate, both within and outside the royal family, over the issue of
succession. By tradition, the emirship alternates between the Al-Salem and AlJaber branches of the family. On that basis, were Jaber and Saad to expire in
fairly rapid succession, Sabah could find himself on the throne, and his stint as
prime minister would no doubt make for greater stability under those
circumstances.
However, there is pressure growing among members of the Al-Salem line,
currently headed by Saad, to have one of its younger members succeed Jaber, a
move that would all but destroy Sabah’s chances of ever gaining the throne.
That said, Sabah’s resentment and appetite for palace intrigue might both be
dampened by the consolation prize of the premiership, and such considerations
probably played a role in the decision to name Jaber’s brother to the post.
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Government Program
Laying out his government’s program, Sabah declared that his main objectives
would be the strengthening of national unity and improving cooperation between
the legislative and executive branches of government. With those goals in mind,
he promised to work with the National Assembly to win approval for a
privatization program that has been dormant since it was first proposed in 1992
and to revive the North Kuwait Project (NKP), a program aimed at attracting $7
billion in foreign investment to revamp the country’s five northern oil fields. He
also pledged to “concentrate on fighting corruption in [public] administration,
including the military establishment.”
Female Suffrage
Another item on the government’s agenda, albeit a late addition, is the issue of
extending the vote to women. Although women are granted equal status with
men under the 1962 constitution, an electoral law from that same year limits the
right to vote and hold public office to men over the age of 21. In 1999, Jaber
issued a decree granting women the vote, but the measure was rejected by
Islamists and conservative tribal leaders in the National Assembly. Subsequent
efforts to challenge the unequal treatment of women as unconstitutional met with
failure, as the high court threw out the cases on jurisdictional grounds.
Prior to the July elections, Sabah was quoted as saying that the new Assembly
would approve a law permitting women to vote and hold political office.
However, that was before the liberals took their beating at the ballot box.
When Sabah initially presented his government’s program, no mention was made
of voting rights for women, no doubt in recognition of the strengthened position
in parliament of the reform’s opponents. In response to protests from liberals
and women’s groups, Sabah announced in late July that his government will seek
a revision of the country’s electoral law. However, he faces an uphill battle on
that score, and it is doubtful that he will embrace women’s right to vote as a
project conducive to the strengthening of national unity.
In mid August, some 50 former government ministers, parliamentarians,
businessmen, university graduates and political activists signed a petition asking
for constitutional reform in Kuwait. The petition called for greater freedom and
extended right to vote for women.
*
124
*
*
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September 2003
SUDAN
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
44.5
30.5
33.5
54.3
High
Current
09/03
45.0
29.5
34.0
54.3
High
One Year
Ahead
Worst
Best
Case
Case
30.0
50.0
25.0
32.0
27.0
36.0
41.0
59.0
V.High High
Five Years
Ahead
Worst
Best
Case
Case
28.0
60.0
25.0
36.0
25.0
38.0
39.0
67.0
V.High Mod.
POLITICS
Internal Conflict
A seventh round of peace talks between representatives from President Omar alBashir’s National Congress Party (NCP) government and the rebel Sudan
People’s Liberation Movement (SPLM) under a framework agreement signed in
Machakos, Kenya in 2002 ended on August 24, with plans to resume
negotiations in mid-September. As the round of talks concluded, local media
reports indicated that the two sides had made progress toward an agreement on
some secondary issues concerning the future division of political power within a
proposed national unity government. However, the SPLM played down the
extent of any progress that had been made, and instead accused the government
of attempting to derail the process by retreating on agreements reached during
earlier rounds of talks.
Machakos Protocol
The Machakos Protocol signed in July 2002 represents the broad outline of an
agreement aimed at ending two decades of civil war between the northern
Muslim government and rebel forces that have been fighting to win greater
autonomy for the mainly Christian and animist people of the south.
The agreement provides for the separation of state and religion in the south,
while permitting the continued application of Islamic law in the north, and a
more equitable distribution of the country’s oil wealth (which is primarily
located in the south but has disproportionately benefited the north). In addition,
the two sides have agreed to share power at the national level for a period of six
years, after which the people of southern Sudan will hold a referendum on selfdetermination.
Negotiators have since sought to put flesh on the skeleton represented by the
Machakos Protocol, with key areas of focus including the division of the wealth
and power, and the maintenance of security during the six-year transition period.
Progress has been made on the division of revenue, but the two sides have failed
to present mutually acceptable terms for a range of important issues, particularly
security-related matters, and peace talks showed every sign of approaching an
impasse when the fifth round of talks concluded in May.
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Nakuru Document
In an effort to jump-start the process, the Inter-governmental Authority on
Development (IGAD), the international body mediating the peace talks, sought
to redirect negotiations away from the previous issue-by-issue format toward a
more comprehensive approach. With that goal in mind, mediators presented a
draft agreement—the so-called Nakuru document—to both sides in early July.
According to IGAD mediators, the proposals represented the best opportunity for
a just and lasting peace.
Several elements of the Nakuru document drew immediate, and forceful,
resistance from the Sudanese government. The first was the proposal that
Khartoum be a place where all citizens enjoy equal status, implying that Islamic
law could not be enforced there as elsewhere in the north under the terms of the
Machakos Protocol.
Just as controversially, IGAD proposed that the regions of Abyei, the Nuba
Mountains, and Southern Blue Nile—all of which are located in the north, but
whose populations are in the main more closely aligned to the south in terms of
religion and ethnicity—be organized as special administrative regions enjoying
relative autonomy from either the north or the south. The government argued
that both of these proposals directly conflicted with central principles of the
Machakos Protocol, namely, the division of political control according to region,
and the establishment of Islamic law in the north and secular law in the south.
Other offending proposals included the draft agreement’s support for separate
northern and southern military forces, and, or so Khartoum has inferred, the
establishment of separate central banks in each of the main regions. Government
officials contend that both proposals merely prepare the ground for eventual
southern secession, rather than promoting the maintenance of national integrity.
In addition, Khartoum voiced objections to proposals that the vice president,
who will represent the southern region, be given an effective veto over the
president’s decisions on some matters.
Not surprisingly, the government flatly rejected the document. President Omar
Hassan al-Bashir delivered a fiery speech in which he told international
mediators they could “go to hell” if they insisted in imposing the proposals as a
basis for negotiations, and government officials openly suggested that the peace
process might be better served if mediated by the African Union or the Arab
League, rather than IGAD. Even more troubling, in rejecting the Nakuru
document, the government implied its refusal to honor previously concluded
agreements on less controversial matters, effectively setting the entire process
back at the starting line.
For their part, the rebels were more accepting of the draft agreement, as might
have been expected given the fact that on just about every contentious issue, the
Nakuru document appears to come down in favor of the southern position. On
August 9, the umbrella Southern Political Parties Inside Sudan, which includes
members of the SPLM and other rebel organizations, as well as representatives
of southern church, student, and labor organizations, issued a press release in
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September 2003
which they accused President Bashir of misrepresenting both the content and the
intent of the Nakuru document in an effort to undermine the credibility of IGAD
and thwart the peace process.
The signatories to the release asserted that the Nakuru document does not call
for—nor does the south necessarily desire—a separate banking and/or currency
system, while the government itself has previously supported the existence of
separate regional armies, which in any case are provided for in the current
constitution. As for the veto power wielded by the vice president, the southern
parties pointed out that the approval of the vice president is required only in
three areas—the declaration of a state of emergency, the proroguing of the
legislature, and the filling of positions created as a direct result of the peace
agreement—all of which are central to the success of any peace agreement and
so, they argued, must be handled in collegial fashion.
On this last point, the release succinctly summarized the chief sticking point to
progress in the overall negotiations, stating, “It is inconceivable that decisions
that will surely affect the proper implementation of the Peace Agreement can be
left in the hands of one party to the Agreement. This is more so, given the gulf
of lack of confidence between the parties.” It is precisely that lack of
confidence, or trust, between the two sides that stands as the chief impediment to
further progress.
US Intervention Risks
As negotiations continue to drag, pressure is growing for the US to push the
process along by threatening to impose penalties authorized under the Sudan
Peace Act. Approved by the US Congress in October 2002, the Act requires the
Bush administration to determine every six months if the Sudanese government
is negotiating in good faith.
If officials in Washington determine that Bashir’s government is obstructing
progress toward peace, the Bush administration is authorized to increase
financial support for the SPLM and its military arm, the Sudan People’s
Liberation Army (SPLA), and to propose to Congress the imposition of further
sanctions against Khartoum. In addition, other possible steps include the
introduction of a UN arms embargo, the blocking of Sudan’s access to World
Bank and IMF funds, and measures designed to limit Khartoum’s ability to use
proceeds from oil exports to prosecute its war against the rebels.
So far, the Bush administration’s actions related to the Sudan Peace Act indicate
that Washington favors a gentle approach toward Bashir’s government. The first
report issued under the Act, which was presented in April 2003, noted that the
talks were progressing, albeit imperfectly, and that the peace process governed
by the Machakos Protocol still represented the best opportunity for bringing an
end to the armed conflict. The report further concluded that while the
government’s cooperation with humanitarian efforts remained poor, some
improvement was evident, as Khartoum had reduced its overt obstruction of
relief efforts. With IGAD concurring in those assessments, the US chose not to
take action against the government.
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The Bush administration’s action met with significant protests from some
quarters of the US Congress, and it is an open question whether President Bush
will be able (or inclined) to give the government another pass when the issue
comes up again in October, unless there are concrete signs of progress. As its
stands now, progress will be measured on the basis of acceptance of the Nakuru
document, which Bashir continues to reject outright.
Events over the next two months are likely to figure significantly in the longterm prospects for peace. When negotiations resume in September, IGAD may
choose to simply impose the rejected draft agreement on both sides, and threaten
to give up its role in negotiations if it is not accepted. If the government fails to
accept IGAD’s terms, the US would have no excuse to refrain from exercising its
options under the Sudan Peace Act, a move as likely to produce a resumption of
armed conflict as to force concessions from Khartoum.
Economic Considerations
The best hope that the government will soften its position rests on Khartoum’s
clear desire to avoid undermining the economic progress that has been achieved
through Sudan’s closer integration into the global economy. In July, government
officials confirmed their commitment to setting economic policy within the
framework of an IMF-sponsored reform program that was initiated in 1997. At
the same time, Sudanese representatives opened discussions in Geneva regarding
the country’s efforts to win membership in the WTO, a goal that Bashir’s
government has been pursuing for more than a decade.
In contrast to developing countries in sub-Saharan Africa and Latin America,
whose political leaders have begun to openly question the merits of following the
economic prescriptions of multilateral organizations, Sudan has flourished under
the IMF’s guidance. In the most recent edition of its annual publication, African
Development Indicators, the World Bank pointed to Sudan, along with Uganda,
Tanzania, and Ethiopia, as models for other countries in the region.
The country’s economic success is undeniable. Since seeking the support of the
IMF in 1997, Sudan’s economy has grown by an annual average of nearly 6%,
second only to Botswana among African countries and more than double the
2.7% average for the continent as a whole during the same period. Economic
progress has had some positive social consequences, with life expectancy rising
to 56 years from 50 years in the early 1990s, and other indicators of
development, such as access to health care, literacy, and school enrolment ratios,
also showing significant improvement.
Much of this progress has occurred despite the civil war, but the government is
well aware that it cannot count on continued success if armed conflict resumes.
The international climate has changed dramatically since the onset of the war on
terrorism in late 2001, and the potentially hobbling effect of sanctions and other
measures that might be imposed under the Sudan Peace Act will undoubtedly
give officials in Khartoum pause. Consequently, the government is expected to
adopt a more conciliatory posture come September. Its failure to do so could
force the US to enforce the Sudan Peace Act in order to preserve its credibility in
mediation efforts—a move that would in itself hamper the peace process.
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September 2003
TUNISIA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
71.5
36.5
36.0
72.0
Low
Current
09/03
73.0
36.0
36.5
72.8
Low
One Year
Ahead
Worst Best
Case
Case
50.0
73.0
33.0
37.0
34.0
37.0
58.5
73.5
High
Low
Five Years
Ahead
Worst Best
Case
Case
50.0
76.0
30.0
38.0
30.0
37.0
55.0
75.5
High
Low
POLITICS
Democratic Accountability
President Zine El Abidine Ben Ali ended months of speculation in late July,
when he formally announced at the party congress of the governing Democratic
Constitutional Rally (RCD) that he will stand for a fourth term in 2004. The
announcement came just weeks after Tunisian government spokespeople were
forced to deny a report by the French daily Liberation that the 66-year-old
president has been suffering from serious health problems. According to the
report, based on information obtained from an unnamed source within the RCD,
the president is battling prostate cancer, and has doctors living at his residence.
Apart from the rumors of ill health, there appeared to be little reason to expect
that Ben Ali might choose to forego a re-election bid. His supporters have been
stumping for a constitutional amendment to allow him to seek a fourth term, and
as the RCD fully dominates the legislative process, and Ben Ali fully dominates
the RCD, the constitutional revision, which was approved in a referendum in
mid-2002 and formally instituted in mid-May 2003, was a done deal from the
start.
Cosmetic Political Reforms
In addition to the amendment freeing Ben Ali to seek a fourth term, another
constitutional change allows up to five opposition parties to nominate candidates
for the presidency. Given that the two challengers who went up against Ben Ali
in 1999 won a combined 0.5% of the vote, moves to crowd the field of also-rans
can only be characterized as a step in the direction of greater democracy in a
theoretical sense.
While the opposition looks to have little chance of gaining any kind of political
foothold in the foreseeable future, prospects for politically ambitious women are
somewhat better, particularly if they happen to be members of the RCD. In late
July, Ben Ali announced that 25% of the party’s nominations for the next round
of legislative and municipal elections will be reserved for women, who currently
hold 11% of the seats in the Chamber of Deputies and 21% of positions on
municipal councils. In addition, women are to make up 25% of the delegates to
future party congresses and hold one-quarter of the seats on the RCD Central
Committee.
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Human Rights Charges Persist
In early June, human rights watchdog Amnesty International (AI) published its
first major report on Tunisia since 1998. The report accused Tunisia of
systematic human rights abuses and being in violation of international norms and
laws. Kate Allen, AI’s director for the UK, stated, “In Tunisia, opponents or
perceived opponents of the government are subjected to abuse within a justice
system resembling one from a Kafka novel.”
That assessment was echoed by the chairman of Tunisian League for the Defense
of Human Rights (LTDH), Mokhtar Trifi, who reported in mid-July that progress
on improving human rights had “stagnated” since 2002. Trifi noted that there
remain 500-600 political prisoners or prisoners of conscience detained in the
country’s jails. (For their part, government officials insist that all detainees are
convicted criminals.) In addition, the LTDH leader asserted that despite
government pledges to improve conditions in prisons, the situation remains
“catastrophic,” and authorities continue to prevent human rights advocates from
visiting detention centers.
In a related development, the media advocacy group, Reporters Without Borders
(RSF) honored Zouhair Yahyaoui, a Tunisian journalist jailed after establishing
an opposition web site, with their first Cyber-Freedom Prize in July. Yahyaoui
was arrested in June 2002, and sentenced to two years imprisonment for
“spreading false news” on his Tunezine.com site.
Yahyaoui came under scrutiny from the authorities after he posted an open letter
to Ben Ali written by his uncle, former high court judge Mokhtar Yahyaoui, in
July 2001, in which the justice decried “the total absence of independence in the
judiciary,” adding the charge that the nation’s judges “are forced to issue
verdicts determined in advance, which they cannot discuss and which in no way
reflect what the law says.”
According to RSF, Tunisian authorities use a wide range of sophisticated
techniques to thwart the free flow of information via the Internet, including
barring public access to non-approved web sites, intercepting e-mail, regulating
the activities of Internet service providers, monitoring Internet cafes, and even
sending computer viruses to political dissidents.
ECONOMY
Despite a dismal human rights record, the vast majority of Tunisians will remain
silent on the matter and will undoubtedly carry Ben Ali to a fourth consecutive
term in the presidency in 2004, largely owing to the general sense of
contentment fostered by the continued health of the economy. Even in 2002,
when the economy suffered the simultaneous (and potentially devastating)
shocks of a deadly terrorist attack, weak demand in key external markets, and a
fourth consecutive year of drought, the economy registered positive growth of
1.7% and the high unemployment rate actually fell slightly, despite a tightening
of fiscal and monetary policies.
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September 2003
An annual review of the country’s economy published by the IMF in August
included much praise for the government’s success in the economic realm since
the mid-1990s, which Fund representatives attributed to “appropriate
macroeconomic policies, a forward-thinking but gradual opening of the
economy, and well-targeted social policies.” The IMF noted significant progress
in reducing poverty, improving Tunisia’s external position, and containing
inflation.
The IMF presented a promising picture of developments in 2003, forecasting real
GDP growth in excess of 5%, while noting that the as yet uncertain recovery of
the tourism sector will pose a key risk to the outlook. There is little sign of
inflation, despite some easing of monetary policy since the beginning of the year,
and the IMF foresees a narrowing of the current account deficit and steady levels
of international reserves. Fund directors noted that further market reforms will
be necessary to reduce the still worrisome unemployment rate, which remains
close to 15%, and to cut the level of public debt.
Figures provided by the Ministry of Development and International Cooperation
in mid-2003 paint an even rosier picture for the economy this year, with growth
projected to reach 5.5% on the back of improving exports, which grew by 19%
during January—May compared to the same period last year. The government’s
growth forecast is based largely on the expected rebound in agricultural exports,
which have benefited from ample rains during the most recent growing season.
It is likely that both the IMF and the government are too optimistic in their
growth projections, given the dim prospects for a significant increase in demand
from the EU, the destination of some 80% of Tunisia’s exports. Moreover, as
noted by the IMF, the potential for further terrorism-related setbacks for the
tourism sector is a source of concern.
Tunisia: Selected Economic and Financial Indicators, 1998-2003
1998 1999 2000 2001 2002
Est.
(percent change)
Production and income
Real GDP
4.8
6.1
4.7
4.9
1.7
GDP deflator
3.0
3.1
3.3
2.7
2.3
Consumer price index (CPI), average
3.1
2.7
3.0
1.9
2.8
Gross national savings
23.5 24.1 23.1 23.5 21.8
(in percent of GDP)
Gross investment (in percent of GDP)
26.9 26.3 27.3 27.8 25.3
External sector
Exports of goods, f.o.b. (in US$)
Imports of goods, f.o.b. (in US$)
Trade balance (in percent of GDP)
Current account, excl. grants
(in percent of GDP)
Real effective exchange rate 1
Central government
Total revenue, excluding grants
3.1
4.9
-10.9
-3.4
2.3
1.6
-10.3
-2.2
-0.1
1.0
24.3
(percent change)
-0.4 13.2
3.8
1.0 11.3
-0.2
-11.6 -12.0 -10.1
-4.2
-4.3
-3.5
-1.7
5.5
2.1
2.5
22.3
25.5
22.1
19.6
-9.2
-3.1
-1.2
...
(percent of GDP) 2
23.9 24.0 24.4 24.4
24.0
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-2.4
2003
Proj.
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September 2003
Tunisia: Selected Economic and Financial Indicators, 1998-2003
1998 1999 2000 2001 2002
Est.
Total expenditure and net lending
27.9 27.8 27.8 28.1 27.9
Central government balance,
-3.6
-3.9
-3.8
-3.8
-3.5
excluding grants and privatization
Central government balance, including
-3.2
-3.5
-3.7
-3.5
-3.1
grants, excluding privatization
Total government debt
56.3 60.0 60.7 62.4 61.6
(foreign and domestic)
Money and credit
Credit to the economy
Broad money (M3)
Velocity of circulation (GDP/M3)
Liquidity aggregate (M4)
Interest rate (money market rate, in
percent, end of period)
Official reserves
Gross official reserves
(US$ billions, end of period)
In months of imports of goods, c.i.f.
Total external debt
External debt (in percent of GDP)
Debt service ratio
(percent of exports of GNFS)
(percent change)
8.0 10.3
5.4
13.2 11.3
5.2
1.71 1.65 1.63
4.47 6.42 4.00
5.88 5.94 5.91
132
59.2
8.5
18.6
1.79
9.42
5.88
1.9
2.3
1.8
2.0
2.3
2.6
2.7
3.2
2.6
2.5
2.9
2.8
(Short, medium and long term)
60.1 59.7 60.2 61.0
18.5 22.6 15.6 17.2
57.2
16.4
Source: IMF, August 2003.
1-IMF Information Notice System (average). 2- Excludes the social security accounts.
*
-2.8
8.7
6.0
1.9
9.3
6.9
56.5
19.2
*
2003
Proj.
27.1
-3.1
*
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7.4
8.4
1.62
8.17
...
International Country Risk Guide
September 2003
SUB-SAHARAN
AFRICA
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International Country Risk Guide
September 2003
CURRENT RISK ASSESSMENTS AND FORECASTS
COUNTRY
Angola
Botswana
Burkina Faso
Cameroon
Congo, Dem. Rep.
Congo, Rep.
Cote d'Ivoire
Ethiopia
Gabon
Gambia
Ghana
Guinea
Guinea-Bissau
Kenya
Liberia
Madagascar
Malawi
Mali
Mozambique
Namibia
Niger
Nigeria
Senegal
Sierra Leone
Somalia
South Africa
Tanzania
Togo
Uganda
Zambia
Zimbabwe
CURRENT RATINGS
Political
Financial Economic
Risk
Risk
Risk
09/03
09/03
09/03
58.5
25.5
26.0
76.5
44.0
38.5
63.5
23.5
29.5
54.0
33.5
36.5
38.5
24.5
30.0
56.5
23.0
18.0
46.5
30.5
34.0
54.0
31.5
33.0
60.5
34.0
38.0
69.5
29.0
35.5
61.5
33.5
31.0
53.5
35.5
35.0
47.5
21.5
26.0
62.5
36.5
32.5
32.5
18.5
21.0
60.0
32.0
28.0
56.5
25.5
26.0
61.5
31.5
24.0
63.0
34.0
25.5
76.0
41.0
35.5
58.5
25.5
31.0
44.0
39.0
31.0
59.0
35.5
35.0
56.0
21.0
25.5
27.0
35.5
28.5
65.5
36.0
35.5
60.5
21.0
34.5
51.0
34.0
31.5
56.5
34.0
33.5
57.5
25.0
23.0
38.0
21.0
9.5
Year
Ago
10/02
53.3
79.8
58.8
63.0
41.5
61.0
56.3
59.3
66.5
66.3
60.8
62.5
48.3
58.0
45.3
58.8
54.0
58.8
61.0
76.5
57.5
51.0
66.0
52.3
43.0
67.5
57.5
59.8
63.0
49.0
37.3
COMPOSITE RATINGS
Current
Forecasts
Rating
One Year
Five Year
09/03
WC
BC
WC
BC
55.0
44.0
54.0
46.5
63.0
79.5
73.5
80.0
69.5
82.5
58.3
53.5
62.3
52.5
66.5
62.0
57.5
65.0
54.0
66.0
46.5
47.0
56.5
41.5
66.5
48.8
53.0
62.0
49.0
64.5
55.5
58.0
67.3
57.0
69.0
59.3
51.5
60.5
52.5
67.0
66.3
61.5
72.0
58.0
75.0
67.0
65.0
72.5
61.0
76.0
63.0
59.0
65.5
57.5
67.5
62.0
58.5
64.5
54.0
66.5
47.5
46.5
53.5
50.5
63.5
65.8
62.5
68.0
54.0
71.5
36.0
35.0
44.5
35.0
53.0
60.0
63.5
69.5
60.0
71.0
54.0
49.0
57.5
49.0
63.0
58.5
58.5
68.5
54.0
71.0
61.3
54.5
63.5
48.0
65.0
76.3
70.5
77.8
68.0
79.5
57.5
57.5
64.5
53.0
67.5
57.0
49.5
65.5
49.0
71.5
64.8
60.0
64.0
52.5
66.0
51.3
45.0
55.5
37.5
60.0
45.5
33.0
43.5
32.0
55.5
68.5
61.5
71.0
56.5
73.0
58.0
55.0
62.0
52.5
66.5
58.3
54.0
62.0
54.0
68.0
62.0
58.0
64.0
54.0
67.5
52.8
55.0
58.0
52.0
64.0
34.3
27.5
55.0
34.0
66.0
For historical risk ratings and key economic data on these and other countries in ICRG, please go to
www.CountryData.com.
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BOTSWANA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
75.5
45.0
39.0
79.8
Low
Current
09/03
76.5
44.0
38.5
79.5
Low
One Year
Ahead
Worst
Best
Case
Case
71.0
76.0
40.0
45.0
36.0
39.0
73.5
80.0
Low
V.Low
Five Years
Ahead
Worst
Best
Case
Case
65.0
77.0
38.0
47.0
36.0
41.0
69.5
82.5
Mod. V.Low
POLITICS
Government Stability
BDP Disunity?
With just over a year to go before Botswana holds its next general elections,
President Festus Gontebanye Mogae’s governing Botswana Democratic Party
(BDP) faces possible divisions following election of Vice President Ian Khama
to the party chairmanship on July 21.
In truth, the BDP has suffered from simmering factionalism since Mogae came
to office following the retirement of Ketumile Masire from the presidency in
1998. That switch led to divisions between the pro-Masire old guard of the party
and the more reform minded faction headed up by Mogae.
One of the key figures within the old guard was the party’s chairman,
Ponatshego Kedikilwe, who Mogae subsequently appointed as finance and
development minister in a bid to placate that faction of the BDP. However,
Mogae also appointed Khama to the vice presidency, in order to consolidate his
own power base and counter that of the Kedikilwe camp.
Ian Khama
Khama is the son of Botswana’s founding president, Seretse Khama, and prior to
his appointment as vice president, was commander of the Botswana Defense
Force (BDF). As such, he is highly respected within the country at large for his
family connections, and continues to command considerable influence within the
armed forces.
By appointing Khama as vice president, and therefore his constitutional
successor in the event of him having to give up the presidency, Mogae
effectively clipped the wings of the Kedikilwe faction of the BDP by aligning
himself with a virtually unassailable political figure. That is how the situation
has remained during Mogae’s term, with Kedikilwe’s ability to wield the
unarguable influence he has within the BDP constrained by the fact that Khama
has more.
Mogae has indicated he wants a second successive term. As the president is
elected by parliament immediately after each parliamentary election, the strength
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of the factions within the BDP is critical. Hence, it appears that Mogae now
wants to further consolidate his hold over the party at the expense of Kedikilwe
and his supporters.
That desire became apparent ahead of the party chairmanship elections, when
Mogae publicly declared his preference for Khama. Such overt presidential
pressure on what was supposed to be a democratic process drew howls of
criticism from the opposition Botswana National Front (BNF) and a goodly
proportion of the country’s media, who argued that it smacked of political
patronage in the extreme and undermined Botswana’s reputation—virtually
unmatched in sub-Saharan Africa—for democratic transparency.
Party Chairmanship Results
In the event, those arguments failed to sway sufficient numbers of BDP delegates
to the party congress in late July. In fact, Khama won a handsome victory,
polling some 512 votes to Kedikilwe’s 218. Meanwhile, Kedikilwe also failed to
be elected to the central committee of the party.
Kedikilwe remained stoic in the face of his defeat, saying that it would not mark
the end of his political career. He called on his supporters to “defend and
enhance” Botswana’s democratic principles, regardless of the degree of political
power available to them.
Outlook
On the face of it, the magnitude of Khama’s victory would tend to suggest that
the BDP will be a deal more cohesive under his chairmanship and, insofar as the
Mogae/Khama camp is concerned, that is likely.
However, for all his mild-mannered acceptance of defeat, Kedikilwe has been
humiliated. His assertion that his political career will continue raises the
obvious question; in what capacity? One possible answer is that he might spend
the rest of the time between now and the election building up support within the
party to challenge Mogae for the presidency. Given that he was able to
command the support of nearly a third of delegates to the party congress, such a
challenge could have an outside chance of succeeding. And, even if it failed, it
could have serious implications for the stability of the BDP as a whole.
Given that, it is perhaps surprising that the BNF opposed Mogae’s support of
Khama so vociferously, as ultimately it might prove to have been the catalyst for
a formal split that will improve its own electoral chances come October next
year.
New Health Minister
President Mogae appointed a new health minister on July 30 following the
departure of Mrs. Joy Phumaphi from the post to take up her new appointment as
assistant director general at the World Health Organization (WHO) in Geneva.
Her replacement was named as Mrs. Lesogo Mosomi, whose former position as
assistant minister of labor and home affairs was taken by government newcomer,
Major-General Moeng Pheto, who was elected as the member of parliament
(MP) for Lentsweletau last year.
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Although not connected, Mrs. Phumaphi’s departure to the WHO came just as
the HIV/AIDS vaccine trials approved by her ministry have come under fire.
The trials, conducted by the Botswana Harvard AIDS Partnership for HIV
Research and Education, began earlier this year after successful tests on animals.
The study is scheduled to last 18 months and will involve 42 HIV-negative
volunteers from Botswana and the United States.
In order to safeguard the rights of participants in the trials, the Partnership
established a Community Advisory Board (CAB) with responsibility for
ensuring that the trials respect the human rights, dignity, and safety the
participants. However, one of the Board’s members, the Botswana Center for
Human Rights (BCHR), has criticized it for having no legal standing and for
offering little legal protection for those taking part in the trials.
BCHR Director Alice Mogwe pointed out in early August that board cannot sue
or be sued if anything adverse happens to trial participants. She called on the
government to enforce the principles of the International Covenant on Civil and
Political Rights, which it has ratified. The covenant stipulates that no one shall
be subjected to scientific experimentation.
The government claims that no additional protection is needed as the interests of
participants in the trials are protected by the Drugs and Related Substances Act.
Dismissing Ms. Mogwe’s complaint, the government’s director of health
services, Dr. Patson Mazonde, noted, “There is also the Health Research and
Development Committee, whose job it is to look after all health-related research
taking place in Botswana, to make sure it is done in a scientific manner.”
External Conflict
USA
In the meantime, the BNF has been concentrating its criticism on Botswana’s
relations with the USA, which although traditionally good, look to have
strengthened further of late.
The most obvious indication of that strengthening came on July 10, when US
President George W. Bush visited the country as part of his whistle-stop tour of
Africa. Aside from expressing some disappointment at the failure of Botswana
and its fellow South African Development Council (SADC) nations to pressure
Zimbabwean President Robert Mugabe into stepping down, Bush had all but
unqualified praise for the country, lauding its “sound governance,” along with
the strength of its democracy and vigor of its economy.
All that is music to the ears of Mogae, who is keen to encourage greater US
investment in Botswana, and to give a boost to the tourist sector, which has
suffered from the knock-on effects of the crisis in Zimbabwe. Similarly, he
welcomed Bush’s assertion that on the subject of HIV/AIDS, Botswana had
made an important start to combating the disease and would receive US help in
continuing that fight.
However, outside of warm words, President Bush promised little in the way of
concrete help, and so far there has been little movement in the US Congress on
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September 2003
his January pledge to provide Africa with some $15 billion in AIDS aid over the
next five years. That Botswana could use a significant proportion of that
funding is undeniable. Despite the “vigor” of its economy, it is one of Africa’s
AIDS’ hotspots, with some 38% of the adult population infected by its precursor,
HIV.
BNF Opposition
Away from the AIDS issue, the BNF was highly critical of Bush’s visit. It
regards the USA as a terrorist state that has illegally overthrown governments
throughout the world, most recently of course, that of Iraq.
Aside from that general loathing, the BNF voiced some rather more specific
concerns regarding Botswana’s recent ties to the USA. Not least of those was
the allegation, which surfaced in early July, that US Central Intelligence Agency
(CIA) operatives had used Botswana as a conduit through which to transport
several suspected al-Qaida members to the USA after they had been kidnapped
in Malawi. Both the Botswana government and the CIA deny those claims.
International Criminal Court Row
Rather more substantially, the BNF came out strongly in mid-July against the
government’s agreement with the USA over the controversial issue of the
International Criminal Court (ICC).
The USA has famously refused to sign up to the court, for fear that US soldiers
and other government personnel taking part in the country’s various
policing/intervention operations around the world could be subjected to war
crimes’ prosecutions.
Shortly ahead of Bush’s visit, the government approved a deal with the USA
under which Botswana will not surrender US nationals to the ICC, be they
“current or former government officials, employees (including contractors) or
military personnel.” The only exceptions are that US nationals would be handed
over to a tribunal established under the auspices of the UN Security Council
(UNSC), or to the ICC if the USA gave its consent.
The BNF argues first that as a permanent member of the UNSC, the USA could
always veto the establishment of a tribunal to look into alleged criminality on the
part of its citizens, and that second; consent for US nationals to face the ICC is
unlikely ever to be given by the USA itself.
Consequently, the BDP has, according to the BNF, become an apologist for US
excesses around the globe and, in so doing, has weakened Botswana’s own
judicial system.
Whether or not US relations will remain an issue in the run-up to the elections is
unclear, but the possibility cannot be ruled out, particularly as the ICC issue has
the potential to cast Mogae and his government as weak puppets of the US
administration.
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Internal Conflict
Strikes’ Threat
President Mogae also faces the discomfiting prospect of widespread strike action
ahead of the elections.
Generally, Botswana’s trade unions are a fairly
quiescent lot, but have begun to kick up a bit of a fuss of late. The most recent
trouble was in September and November 2002, with teachers and local authority
employees organized a wave of strikes for better pay. The strikes stopped after
President Festus Mogae intervened and promised the trade unions he would
appoint a salary commission to look into their grievances.
The salary commission published its recommendations for a new public sector
salary structure on August 11. In essence, it calls for hefty salary increases for
top public servants, but reduced rises for middle management on the basis in
order to “align local salaries with best international practice.”
The recommendations produced howls of outrage from the trade unions. The
chairman of Botswana Unified Local Government Services Association,
Galetsoswe Lebitsa, said, “We are very, very unhappy with the recommendations
of the commission. If (government) implements them, there will be a lot of
chaos…We hope that all unions will come together and draw up a strategy to
address this problem.” He added, “We had hoped the commission would bridge
the gap between the top and middle management but...they have now made
things worse and the salary ratio is now 1:49.”
The same line was taken by Samuel Molaodi, the administrative secretary of the
biggest and most radical union, the Manual Workers Union, who said his union
“rejected the recommendation of the commission” and launched a blistering
attack on the government'. “We do not believe that the recommendations of the
commission should be imposed on the public service and we would like to
negotiate salaries of our members with government. The problem that we are
facing is that this government is stubborn and does not want to negotiate and it
never takes the unions' concerns into consideration.”
The unions’ biggest complaint is their inability to participate in wage bargaining,
leaving them with only two options—acceptance or confrontation. As Molaodi
noted, “The labor laws…should be amended to allow a collective bargaining
process, which is in line with International Labor Organization standards.”
So, the stage seems set for confrontation. Unless, of course, President Mogae
feels that compromise is preferable, given the proximity of the general election.
*
*
*
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CONGO, REPUBLIC
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
55.0
30.5
36.5
61.0
Mod.
Current
09/03
56.5
23.0
18.0
48.8
V.High
One Year
Ahead
Worst Best
Case
Case
50.0
58.0
29.0
31.0
27.0
35.0
53.0
62.0
High
Mod.
Five Years
Ahead
Worst
Best
Case
Case
48.0
58.0
25.0
34.0
25.0
37.0
49.0
64.5
V.High Mod.
POLITICS
Internal/External Conflict
Since the signing of a peace agreement in mid-March this year between
President Dennis Sassou-Nguesso’s government and the rebel Ninja forces that
had been operating in the Pool region, Congo has enjoyed a period of relative
internal stability that has seen several thousand former rebel fighters disarm and
allowed the focus of government to shift away from the conflict.
Beach Case Ruling
However, that focus looks set to return over the coming weeks following a midJune ruling by the International Court of Justice (ICJ) at The Hague that rejected
Congo’s bid to prevent a French investigation into alleged war crimes committed
by the Sassou-Nguesso regime during that conflict. The investigation centers on
what is known as the “Beach Case,” in which human rights groups, including
Amnesty International (AI), allege that some 350 people were the victims of
extrajudicial killings in May 1999.
Those people were part of a group of several thousand that had previously fled
the fighting in and around the Pool region and were returning to the country from
the neighboring Democratic Republic of Congo following the establishment of a
humanitarian corridor by the UN High Commissioner for Refugees (UNHCR).
The alleged victims disappeared from a port on the Congo River known as Le
Beach.
Moves to bring senior members of the government to book over the affair began
in December 2001 when human rights groups filed a case at the High Court in
the French town of Meaux alleging that Sassou-Nguesso, Interior Minister Pierre
Oba, inspector-general of the armed forces General Norbert Dabira, Commander
of the Republican Guard Blaise Adoua, and others were guilty of crimes against
humanity and torture in relation to the disappearances.
Similar charges have been laid before Belgian courts, but it is the French
investigation that stemmed from the Meaux case that lay at the center of the ICJ
ruling. The Congolese government had called on the ICJ to order France to drop
its proceedings because they were in violation of the country’s sovereignty and
ignored Sassou-Nguesso’s presidential immunity from prosecution.
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However, in making its ruling, the ICJ concurred with the argument put forward
by the human rights groups that as Dabira has a home close to the French capital,
Paris, the alleged crimes can be investigated in the French courts despite having
been committed outside of the country. The Congolese government made no
immediate official response to this argument, but what is certain is that it will
not willingly allow Sassou-Nguesso and his cronies to be hauled before a French
court to answer the charges laid against them.
High Court of Justice Inaugurated
Rather, the likelihood now is that the Republic of Congo will argue that any
investigation should be carried out by its own judicial system. Up until recently,
that argument would have been difficult to support because Congo had no court
empowered to try figures as senior as those accused.
That situation changed on August 13 this year, when the High Court of Justice
(HCJ) was inaugurated in the capital, Brazzaville, with the swearing in of its 35
members before parliament. The court president is Placide Lenga, while the
chief prosecutor is Georges Akiera. As well as judges, the full HCJ complement
includes members of both legislative Houses.
The creation of the HCJ has been on the cards since January 2002, when a
referendum approved the country’s new constitution, which provides for the
establishment of such a court. Under Article 153 of that constitution, the court is
empowered to prosecute the country’s highest authorities, including members of
both houses of parliament (the National Assembly and the Senate), judges, and
the president, for crimes committed during the conduct of their official duties.
Given those powers, the government will doubtless now attempt to block the
French (and Belgian) investigations by claiming that the Beach Case provides an
ideal opportunity for the country to confirm its judicial credentials by having the
HCJ carry out its own probe. Needless to say, any such probe is unlikely to turn
up sufficient evidence to indict any of the main players, but could well find a
sacrificial lamb or two.
French Relations
Meanwhile, Congo’s broader relations with its former colonial power, major
trading partner, and main provider of bilateral aid, France, do not yet appear to
have been unduly damaged by the Beach Case.
On July 31, French Foreign Minister Dominique de Villepin made a brief visit to
Brazzaville during which he held talks with Sassou-Nguesso. Whether or not the
Beach Case came up for discussion was not apparent, but Villepin did praise the
government for its efforts at securing peace in the neighboring countries of the
Central African Republic and Sao Tome and Principe.
In addition, he pledged France’s support for Congo in its bid to secure financial
aid and debt relief from international donor institutions such as the World Bank
and International Monetary Fund (IMF). According to those institutions,
Congo’s debt stands at some $6.4 billion.
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GHANA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
62.5
30.0
29.0
60.8
Mod.
Current
09/03
61.5
33.5
31.0
63.0
Mod.
One Year
Ahead
Worst Best
Case
Case
58.0
67.0
30.0
32.0
30.0
32.0
59.0
65.5
High
Mod.
Five Years
Ahead
Worst Best
Case
Case
60.0
68.0
28.0
33.0
27.0
34.0
57.5
67.5
High
Mod.
POLITICS
President John Kufuor’s New Patriotic Party (NPP) government is doubtless in a
self congratulatory mood following Ghana’s recent hosting of talks to end the
conflict taking place in nearby Liberia. Those talks resulted in the mid-August
departure into exile of Liberian President Charles Taylor and a subsequent peace
agreement between the main rebel groups operating in the country, which
includes plans for a transitional government to be established later this year (see
Liberia report in this issue).
Domestically however, Ghana’s political situation remains as fraught with
intrigue as ever, and looks set to remain that way through to the next presidential
and legislative elections, scheduled for December 2004. That is of course
provided that Kufuor’s administration neither collapses, nor is forcibly removed
in the meantime.
Internal Conflict
Coup Attempt?
The latest rumors of Machiavellian plots to destabilize the country surfaced in
early August, when The Independent newspaper reported the government’s
apparent foiling of a coup attempt that was to have been mounted on August 4.
The report appeared to backed up by Defense Minister Kwame Addo-Kufuor
who said that the security services were conducting investigations into a
“possible bid to destabilize the country,” but that the situation was under control.
In addit6ion, the Information Ministry issued a statement explaining that during
“routine investigations into matters of state security” on August 2, the security
services had detained “three serving military officers, a retired soldier, and a
civilian” for questioning.
However, it then transpired that all five of the detainees were released
immediately after being interviewed by the police, suggesting that the possibility
of a coup might have been overplayed.
Opposition Reaction
That was certainly the view of the main opposition National Democratic
Congress (NDC), which accused the government of orchestrating the affair in a
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deliberate bid to deflect attention away from its shortcomings in terms of the
economy and its failure to address the mounting problem of corruption within its
ranks.
Describing the coup rumor as baseless and “a sign of desperation” on the part of
the government, NDC Director of Communications John Mahama warned of its
dangers in terms of creating tensions within the military that could in turn lead to
the country being “caught off-guard by (any) real miscreants who may attempt to
sabotage our democratic process.”
In addition, he claimed that the government’s manufacturing of the coup report
was made in order to justify a campaign of intimidation against NDC members
and supporters of the opposition in general: “It is likely that the allegations of a
coup plot may be a convenient smoke screen to clamp down on the rising tide of
public criticism and agitation against the incompetence and corruption of the
NPP government and its inability to deliver on its campaign promises.” As to
the “democratic process,” Mahama reaffirmed the NDC’s “irrevocable
commitment to upholding the constitutional order, to sustaining multiparty
democracy, and (to the) preservation of the country’s peace and stability.”
Mahama could have a point. The Kufuor administration does indeed have a
number of issues from which it might seek to deflect attention, and not all of
them center on policy failures. However, by the same token, so does the NDC,
and his robust description of the party as the defender of Ghana’s constitution
would appear at least in part to be at odds with reality.
Shortly ahead of the coup rumor surfacing, the Accra Daily Mail reported on an
NDC rally that took place at the home of the former president, Jerry Rawlings, at
which party supporters apparently chanted “another coup, another coup,” in
reference to his 1981 seizure of power.
Rawlings’s tenure as president came to an end at the December 2000 elections,
at which he did not stand. Rather, the NDC standard was carried by John Atta
Mills, who lost to Kufuor. That was swiftly followed by final voting in the
legislative elections, which saw the NPP assume power over the former ruling
NDC.
Since then, the NDC has regularly accused the NPP of using its supposed anticorruption drive to carry out a witch-hunt against members of the former
administration. Given Rawlings’s close links to some within the military, the
possibility of a coup attempt has been a constant factor lurking in the shadows of
what has been a bitter political struggle.
Murder Allegations
Just how bitter was again underlined shortly ahead of the coup rumor surfacing,
when allegations emerged, from which both sides would doubtless like to see
attention deflected.
The affair began in late May with evidence given to the country’s National
Reconciliation Committee (NRC) by a former army corporal, Matthew Adabuga,
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September 2003
in which he claimed that Rawlings had ordered the murders of three judges and a
retired army officer in 1982. Predictably, Rawlings vehemently denied the
allegations and offered to submit himself to lie detection methods to prove his
innocence.
However, in a further illustration of how no issue in Ghana can avoid becoming
part of the wider political struggle between the NDC and NPP, Rawlings’
willingness to face veracity testing was conditional; he insisted that he would
only take the tests if 15 members of the current government, whom he did not
name, also took them. The reason, he claimed, was that the 15 were responsible
for masterminding the murders of no fewer than 34 women in a serial killing
spate that lasted from 1997 to 2000.
Responding to the allegations, the police asked Rawlings in mid-June to help
them in their investigations into the murders. Although Rawlings presented
himself for interview, he refused to name the 15, claiming that he lacked faith in
the police and that to present the evidence in his possession too early would
allow the allegedly guilty parties time to organize their defense.
With the police expressing “profound disappointment” at that stance, the matter
appeared to be at a standstill. However, in early August, it returned to the
headlines when the government claimed that the accusations were an elaborate
plot aimed at bringing it down.
Conspiracy?
According to Information Minister Nana Akomea, two of Rawlings’ former
ministers, Kwame Peprah (finance) and Ibrahim Adam (food and agriculture),
who are now serving jail terms in the Nsawam medium security prison, were
caught, along with an unidentified female visitor, coaching a convicted murderer,
Charles Quansah, into implicating several current government ministers in the
killings. Akomea said that the trio had been showing Quansah photographs of
the ministers so that he would be able to identify them.
Peprah and Adam, it may be recalled, became akin to NDC martyrs back in April
this year when they were sentenced to jail time in connection with an alleged
$21 million rice production scam. The pair vehemently denied any wrongdoing,
and their case became a centerpiece of the NDC’s claims of a government witchhunt against its members.
On August 1, the High Court rejected their appeals against conviction, making it
at least feasible that they might have wanted to wreak revenge on the
government. However, the veracity—or otherwise—of Akomea’s assertions is
secondary to the fact that at best, claims and counter claims of murderers at the
very highest levels of government are likely to continue in the run-up to next
year’s elections. At worst, the possibility that the discovery of the jail
conspiracy did indeed lead some within the military to contemplate a more direct
method of removing the current government cannot be entirely discounted. If
that was the case, the alleged coup attempt foiled just days after it might yet
prove only to have been the first.
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Bureaucracy Quality
In an apparent bid to increase efficiency, some 71 top civil servants were
reassigned in mid-June this year in the first major reshuffle to take place in the
service for the last 20 years.
Those affected were 22 directors and 49 deputy directors, most of which had
been in place in excess of 15 years. Announcing the move, the head of the civil
service, Alex Glover-Quartey, described that situation as “unacceptable,” and
added that less senior staff would also be reassigned over the coming months.
ECONOMY
PRGF Aid
On the economic front, on May 12 the International Monetary Fund (IMF)
approved a $258 million three year aid package under its Poverty Reduction and
Growth Facility (PRGF). The money is to support the government’s economic
program during 2003-2005, with some $37 million becoming available
immediately. The IMF also approved additional interim assistance of $22
million to Ghana under the Highly Indebted Poor Countries (HIPC) initiative.
In making its decisions, the Fund said that targets for 2003 include a real GDP
growth rate of 4.7%, and an inflation rate of 22%, revised upwards from the
government’s previous 9.9% figure as a result of the effects of gasoline price
increases introduced earlier this year.
In addition, gross foreign reserves are forecast to increase to a level equivalent to
2.3 months worth of imports.
Ghana: Selected Economic and Financial Indicators, 1999-2003
1999
2000
2001
2002
20,580 27,153 38,071 48,862
Nominal GDP (in billions of cedis)
(Annual Percentage change, unless otherwise specified)
National income and prices
Real GDP
4.4
3.7
4.2
4.5
Real GDP per capita
1.8
1.2
1.6
1.9
Nominal GDP
19.0
31.9
40.2
28.3
GDP deflator
13.9
27.2
34.6
22.8
Consumer price index (annual average)
12.4
25.2
32.9
14.8
Consumer price index (end of period)
11.8
40.5
21.3
15.2
External sector
Exports, f.o.b.
Imports, f.o.b.
Export volume
Import volume
Terms of trade
Nominal effective exchange rate (avg.)
Real effective exchange rate (avg.)
Cedis per US dollar (avg.)
Government budget
Domestic revenue (excluding grants)
2003
65,262
4.7
2.1
33.6
27.6
26.9
22.0
-4.1
11.4
8.9
9.6
-13.4
-9.3
0.5
2,669
-3.5
-15.2
1.0
-26.0
-16.6
-46.3
-35.5
5,431
-3.6
2.6
-1.3
10.0
4.8
-24.0
0.7
7,179
10.6
-4.1
-1.5
-6.8
9.1
-11.7
-0.6
7,947
12.1
16.8
2.7
7.6
0.7
...
...
...
6.0
42.9
43.5
27.5
60.3
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Ghana: Selected Economic and Financial Indicators, 1999-2003
1999
2000
2001
2002
Total expenditure
9.0
39.6
65.5
2.4
Current expenditure
13.1
48.9
50.5
28.8
Capital expenditure and net lending
4.1
24.1
95.7
-38.7
Money and credit
Net domestic assets 1
Credit to government 1
Credit to pubic enterprises 1, 2
Credit to the private sector 1, 2
Broad money (excluding foreign
currency deposits)
Reserve money (excluding foreign
currency deposits)
Velocity
(GDP/end-of-period broad money)
Treasury bill yield
(in percent; end of period)
2003
50.0
33.5
104.1
46.0
38.2
9.0
24.9
19.8
49.1
57.7
19.2
34.4
33.4
13.5
0.0
9.7
12.0
48.4
14.0
32.6
-9.0
17.7
50.0
-1.7
0.0
1.5
18.8
25.0
35.8
52.6
31.3
42.6
24.5
5.2
5.1
4.8
4.1
4.4
34.2
42.0
28.9
28.2
...
(In percent of GDP, unless otherwise specified)
Government budget
Total revenue
16.4
17.7
18.1
Grants
1.7
2.1
6.9
Total expenditure
26.2
27.7
32.7
Overall balance (excluding grants) 3
-9.8
-10.0
-14.6
Overall balance (including grants) 4
-8.0
-9.7
-9.0
Domestic primary balance
0.4
2.6
3.8
Divestiture receipts
0.3
1.2
0.0
Net Domestic Financing
6.3
8.5
2.3
18.0
3.1
26.1
-8.1
-6.8
2.0
0.0
4.8
21.6
4.6
29.3
-7.7
-3.9
2.9
0.7
0.0
External sector
Current account balance 5
External debt outstanding
External debt service, including to the
Fund
(in percent of exports of goods and
nonfactor services)
(in percent of government revenue)
-11.6
109.9
6.8
-8.4
169.7
11.2
-5.3
131.5
8.5
0.6
112.3
7.8
-1.8
96.4
6.3
21.1
23.0
18.9
18.4
15.6
37.5
56.5
34.1
37.1
24.2
38
39
-61
631
-131
-77
0
811
1.9
2.3
(In millions of US dollars, unless otherwise specified)
-895
-419
-283
Current account balance 5
Overall balance of payments
-266
-123
-2
Change in external arrears
62
27
61
Gross international reserves
317
264
344
(end of period)
(in months of imports of goods and
1.0
0.9
1.2
services)
Source: IMF, May 2003.
1-In percent of broad money at the beginning of the period. 2-Credit from deposit money banks
to public enterprises and the private sector respectively. 3-Before domestic arrears clearance.
4-After domestic arrears clearance. 5-Including official grants.
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LIBERIA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
43.0
19.0
28.5
45.3
V.High
Current
09/03
32.5
18.5
21.0
36.0
V.High
One Year
Ahead
Worst
Best
Case
Case
30.0
45.0
18.0
21.0
22.0
23.0
35.0
44.5
V.High V.High
Five Years
Ahead
Worst
Best
Case
Case
30.0
55.0
20.0
25.0
20.0
26.0
35.0
53.0
V.High High
POLITICS
Government Stability/Internal Conflict
With US warships visible off of the coastline and the first contingents of
Nigerian peacekeepers arriving in the capital, Monrovia, President Charles
Taylor finally left Liberia for exile in Nigeria on August 11. He was replaced by
Vice President Moses Blah, who will lead the country until the establishment of
an interim administration takes place later this year.
The hope now is that Taylor’s departure will signal the end of a string of
conflicts within the country and the region that have been the defining feature of
his career.
Civil and Regional Wars
Those conflicts began back in 1989 when he led the rebel campaign that
ultimately resulted in the execution of the then dictator, Samuel Doe, in 1990.
However, the overthrowing of Doe did not halt the violence. In its wake,
internecine fighting broke out between various rebel factions and Liberia
suffered a further six years of civil war in the run-up to Taylor’s victory in the
1997 presidential election.
During those years of war, an estimated 200,000 people died at the hands of the
various rebel forces, whose ranks were swelled by hundreds of children,
drugged, armed, and forced into committing atrocities that included rape and the
dismemberment of their victims.
Despite having won power, Taylor’s bloodlust continued. He subsequently
orchestrated the civil war in neighboring Sierra Leone and later became involved
in fomenting rebel insurgency in both Cote d’Ivoire and Guinea.
It was the Guinean situation that was to ultimately lead to his fall from power.
Beginning in 2000, that conflict saw pro-Taylor forces pitted against supporters
of other Liberian warlords who had fled the country following his rise to power.
Taylor claimed that the rebel attacks in the north of Liberia were being carried
out with the active support of the Guinean government. In part at least, the
likelihood is that such support did exist, despite Guinea’s vehement denials.
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LURD Insurgency
By early 2002, the rebels, under the banner of Liberians United for
Reconciliation and Democracy (LURD), had made significant territorial gains in
the north, forcing Taylor to implement a state of emergency there. However, by
September of that year, Taylor’s government claimed that the situation had
stabilized and the state of emergency was lifted.
By the end of 2002, it was clear that the previous reduction in rebel activity had
been akin to the lull before the storm. In early 2003, rebel forces, including
those belonging to the newly formed Movement for Democracy in Liberia
(Model), made further gains and by mid-year had effectively encircled the
capital, Monrovia.
Ceasefire
Taylor was besieged, and on June 17 his government signed a ceasefire
agreement with the rebels that was intended to pave the way for negotiations on
his departure from office. However, by that time the situation had been
complicated by Taylor’s indictment by a UN-backed war crimes court in Sierra
Leone on charges related to his orchestration of that country’s civil war.
Eager to avoid facing his accusers, Taylor initially rejected the idea of standing
down, saying that he would serve out his presidential term—due to end in
January next year—and that he reserved the right to stand again. The move
brought an outraged response from the rebel forces, who mounted fresh assaults
on the capital in which hundreds of people were killed.
By early July those attacks, mounting international pressure, and Nigeria’s offer
of a quiet retirement in exile, looked to have made up Taylor’s mind. On July
11, he told his supporters of his decision to be “the sacrificial lamb that you
people should live,” adding that he would quit office on August 11 and leave the
country shortly thereafter.
However, Taylor’s offer was not without conditions. As a prerequisite for his
departure, he demanded that an international peacekeeping force be deployed in
the country to avoid the resumption of war. In fairness, that demand was well
founded. Having heard of their boss’s decision to go, the various pro-Taylor
factions in Monrovia became nervous, threatening to turn the city into a
bloodbath.
US Involvement
In particular, Taylor was keen to see US forces intervene. Although not the
former colonial power, the USA has close historical links to Liberia, which was
originally established as a homeland for freed American slaves.
However, US president George W. Bush remained cautious. Memories of the
USA’s disastrous peacekeeping efforts in Somalia are still fresh in the minds of
many Americans. That, coupled with US forces already being committed in
large numbers in Iraq, as well as numerous other countries as part of the “war on
terrorism” left Bush uneasy about becoming embroiled in yet another conflict in
a far-away place that many Americans would find it difficult to locate on a map.
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Ecowas
Rather, Bush favored the establishment of a regional peacekeeping force with
UN-backing. To that end, the Economic Community of West African States
(Ecowas) set about plans for deploying such a force. By mid-July Ecowas had
agreed to an initial deployment of around 1,500—mainly Nigerian—troops, and
subsequent deployments to bring the total number of peacekeeping soldiers in
the country up to some 5,000. Their task was to police the ceasefire until such
time as a UN force could be deployed to undertake the processes of disarmament
and reintegration of rebel fighters. That force is expected to be in place by the
end of this year.
However, for those deployments to take place, Ecowas noted that US help, in the
form of transport and equipment, would be required. For his part, Bush accepted
that necessity, but warned that US troops would not enter Liberia ahead of their
Ecowas counterparts, if at all.
By late July, the situation on the ground in Liberia had deteriorated further, with
rebel attacks on the capital becoming more severe and the rebels’ seizure of the
strategic port and second city of Buchanan.
As the death toll mounted, so did the pressure on the USA to facilitate the entry
of the Ecowas force and, on July 26, Bush announced the deployment of US
warships to the Liberian coastline. However, he stressed that the forces aboard
those ships would not go into Liberia until Taylor had left the country and that
even then, they would have a limited role in peacekeeping operations and a clear
exit strategy.
Peacekeepers Deployed
From there, events moved rapidly. On August 2, the UN approved the Ecowas
deployment and two days later, the first Nigerian peacekeepers landed in
Monrovia. Despite sporadic fighting continuing in some parts of the capital,
their arrival marked the beginning of a tense calm.
That calm became a deal less tense the following week, when Taylor made good
on his pledge to stand down and go into exile.
Peace Agreement
With Blah, himself a brutal former fighter and close ally of Taylor, in place,
further encouragement came on August 18 with the signing of a peace deal
between his government, LURD, and Model.
Under the terms of the deal, Blah will leave the presidency on October 14 this
year in order to make way for an interim power-sharing administration that will
lead the country for two years. In addition, the deal provides for:
•
•
The immediate disengagement of armed groups.
The deployment of Ecowas forces to maintain the ceasefire and then
become part of an International Stabilization Force (ISF) to carry out
disarmament.
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•
•
•
•
September 2003
The disbandment of all irregular forces and the restructuring of the
Armed Forces of Liberia to include rebel fighters.
The immediate and unconditional release of all political prisoners and
prisoners of war.
The establishment of a Truth and Reconciliation Commission (TRC).
The appointment of a new Supreme Court.
On elections, the agreement calls for an independent national electoral
commission to be established in order that elections can be held in the presence
of foreign monitors no later than 2005.
As to the new administration, neither the rebels, nor existing government
members will assume the top posts, which will instead be held by noncombatants. The legislature will consist of 76 seats, with 12 going to each of the
three main protagonists and the remainder divided between the civilian political
parties and representatives from each of the country’s 15 counties.
In the immediate aftermath of the signing, all sides expressed cautious optimism
as aid agencies rushed in desperately needed food supplies for the 1.3 million
inhabitants and refugees believed to be in Monrovia.
However, by late August the situation was less encouraging outside of the
capital. On August 26, the government claimed that rebel forces had captured to
towns of Gbatala and Bong Mines, which lie some 65 miles north of Monrovia.
According to the government, which later retracted the claims, the attacks were
part of a campaign by the rebels to seize control of government held areas ahead
of the arrival of Ecowas forces.
Despite the government’s retraction, by the end of August it was clear that
fighting was still taking place in the north of the country.
Outlook
Despite the difficulties in the north of the country, the outlook for Liberia should
be one of cautious optimism. That Taylor has left is a major factor in the
country’s hopes for peace. However, the reality is that Blah and the rebel
leaders are cut from the same cloth as he was. They are all vicious warlords who
have been responsible for the most dreadful atrocities and, while the current
mood of compromise is to be welcomed, the possibility of a return to conflict
remains high.
For that reason, the peacekeeping force is essential. However, the ability of the
Ecowas troops to establish and maintain order is open to some question. During
the Sierra Leone conflict, Ecowas got itself horribly bogged down in what was
essentially a similar situation. That conflict, in which Taylor pulled the strings
from afar, was eventually overcome only by the insertion of UK troops.
Also, Taylor’s physical absence from Liberia does not necessarily mean that he
will cease to wield considerable influence, particularly while Blah remains in
charge.
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A further concern is the kind of interim administration that is finally established.
Despite their agreement to allow non-combatants to take the leading roles, the
rebels will be seeking a substantial voice in government, raising the prospect of
inter-rebel rivalries coming to the surface at a time when the disarmament and
demobilization processes remain incomplete.
The worst case scenario is that with Taylor overseeing events from Nigeria, a
poorly equipped Ecowas force will find itself unable to contain rebel forces that
regard their military victory as being replaced by political defeat. In the absence
of a firm commitment in terms of troops and time from the USA, that means that
the speed with which the UN force can be deployed and complete its
disarmament role may prove crucial to the overall success of the peace deal.
ECONOMY
Growth
The Liberian economy had jut begun to consolidate its recovery from the 19891996 civil war, when the renewed insurgency began in 2000. In that year, the
GDP had recovered to about half of its pre-civil war level, largely due to the
rubber and forestry sectors. There was also growth has continued in the informal
and services sectors, including mobile telephones.
However, the small manufacturing sector has continued to suffer from an
unreliable supply of domestic utilities and a virtual absence of foreign
investment. Even more critically, there was no resumption of activity in the
minerals sector. Prior to the civil war iron ore extraction had accounted for 10%
of GDP and 50% of exports.
GDP growth slowed markedly from 2000 on, as LURD incursions in the north
and west of the country disrupted local rubber, logging, and farming activity.
Inflation
Despite some appreciation of the exchange rate during the last quarters of 2001
and 2002, the Liberian dollar has been on a steep downwards trend, declining by
34% in terms of the US dollar in the two years to end-December 2002. With
many prices denominated in US dollars, which is legal tender in Liberia
alongside the Liberian dollar, consumer prices have risen sharply and the 12month inflation rate spiked above 20% in March 2002.
Government Controls
The government has retained a strong influence on key domestic markets,
including the imposition of maximum retail prices on the three products that
dominate the monetized part of the domestic economy: rice, petroleum products,
and cement. Rice and petroleum prices, net of tax, are substantially higher than
in neighboring countries; petroleum imports are restricted to a single supplier; de
facto restrictions still seem to have limited entry to the rice market; and the
single cement producer has benefited from a range of tax concessions and
restrictions on imports.
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However, the government has recently issued press advertisements confirming
the freedom of rice importation from government restriction and has removed the
derogation against the goods and services tax for domestically produced cement.
Banking Sector
The profitability and asset quality of the commercial banks continued to be
under pressure as the deteriorating economic environment caused some rise in
nonperforming loans, the government failed to pay interest due, and new
restrictions were placed on banks' lending rates. The central bank set a limit of
10 percentage points on the spread that could be earned on the interest rates
charged on lending above the weighted average cost of funds, with an absolute
ceiling on lending rates of 18%.
In December 2002, the CBL reimbursed L$55 million to depositors at the
Liberian United Bank (LUBI), which had been seized in April 2000, and
simultaneously issued certificates of deposit (CDs) of equivalent value to four
private companies. The three-month CDs will not accrue interest, but they will
be repayable in US dollars at a fixed rate substantially more beneficial than that
ruling at the issue date, thus providing a guaranteed annualized rate of return in
US dollars, which the CBL estimates at 33%. The CDs give rise to a multiple
currency practice subject to IMF approval.
Budget Balance
The fiscal position has continued to deteriorate. Total government revenue
(including grants) is estimated to have declined by around 13% in fiscal year
2001/02, to US$72 million. No grant income was received by the government,
and the only buoyant areas of revenue were stumpage fees on timber production
and (in the first half of 2002) transfers from the maritime agency. The slowing
economy and tax derogations appear to have substantially depleted other tax
receipts. In order to ensure a fiscal outcome near to balance in cash terms in
2001/02, nonmilitary expenditure was heavily reduced, and further domestic and
external arrears were accumulated.
The adverse revenue trends continued through the remainder of 2002, resulting
in a further pruning of spending on health, education, and other social services.
For calendar year 2002, total government revenue fell to 12.9% of GDP from
15.8% in 2000, and current expenditure dropped to 4.6% of GDP from 9.8%
over the same period. Wage and salary payments to government employees were
eight months in arrears in December 2002.
Monetary Policy
The adverse fiscal position of the central government and central bank has
continued to dominate monetary developments. Liberian currency in circulation
rose by 14% in the 12 months to September 2002 and total reserve money grew
by 10%. The Liberian dollar component of the broad money supply rose by17 %.
Total broad money M2 (which includes bank deposits denominated in US
dollars, but excludes US banknotes) rose by 33%, reflecting in part the
depreciation of the Liberian dollar by 29% in terms of the US dollar through the
period. Holdings of foreign currency by the Central Bank of Liberia (CBL)
remained in the range of US$1.5 million-2 million.
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Current Account Balance
The external current account balance (including grants) improved substantially
in 2002, to an estimated deficit of 5.1% of GDP, compared with a deficit of
20.6% of GDP in 2001. Merchandise exports rose by some 3.6% of GDP, owing
to a higher rubber price and the substantial increase in timber production. In
contrast, the deterioration in the security situation and border closures led to a
sharp decline in goods imports of an estimated 4.5% of GDP.
Liberia has also been subject to UN sanctions, which prohibit arms imports and
diamond exports, since May 2001.
Foreign Debt
Liberia's external debt amounted to close to US$2.8 billion at end-2002 (498%
of GDP), of which US$2.5 billion was in arrears, including US$681 million to
the IMF.
Liberia: Selected Economic Indicators
2000
Nominal GDP (In millions of US dollars)
541.5
Official exchange rate (Liberian dollars per US dollar,
42.8
end of period)
Output and Prices
Real GDP
Consumer prices (annual average)
Central government
Total revenue and grants
Of which : tax revenue
Total expenditure and net lending (cash basis)
Of which : current expenditure
capital expenditure
Overall fiscal balance (cash basis)
External sector
Current account balance, including grants
Current account balance, excluding grants
Trade balance
Exports, f.o.b.
Imports, c.i.f.
Public sector external debt outstanding
Current account balance including grants
Trade balance
2001
534.4
49.5
2002
561.8
65.0
(Annual percentage change)
22.4
4.9
3.3
5.3
12.1
14.2
(In percent of GDP)
15.8
13.0
12.9
13.7
11.4
12.5
15.4
13.7
14.2
9.8
7.6
4.6
6.6
6.1
9.6
-0.6
-0.7
-1.3
-15.9
-28.6
-12.0
22.2
-34.2
473.8
-20.6
-28.7
-12.9
23.9
-36.9
486.4
-5.1
-15.1
-4.5
26.2
-30.7
497.6
(In millions of US dollars)
-86.2
-110.3
-28.7
-64.9
-69.0
-25.6
Source: IMF, September 2003.
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SOUTH AFRICA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
61.5
37.5
36.0
67.5
Mod.
Current
09/03
65.5
36.0
35.5
68.5
Mod.
One Year
Ahead
Worst Best
Case
Case
58.0
66.0
35.0
38.0
30.0
38.0
61.5
71.0
Mod.
Low
Five Years
Ahead
Worst Best
Case
Case
55.0
70.0
30.0
38.0
28.0
38.0
56.5
73.0
High
Low
POLITICS
Corruption
The Zuma Affair
In a move that will do little to enhance the reputation of the governing African
National Congress (ANC) in the run up to elections scheduled for mid-2004, late
August saw a messy end to the probe into corruption allegations against Deputy
President Jacob Zuma.
That investigation centered on media allegations that Zuma had tried to secure an
annual payment of some $60,000 from a French arms company, Thales, in return
for it wining a $5 billion arms deal in 1999.
Now, it would appear that Zuma will be spared the indignity of facing trial for
his alleged role in the affair, but his political reputation looks to be in tatters.
The reason is that, according to the chief prosecutor, Bulelani Ngcuka, the
investigation carried out by the elite Scorpions unit found “prima facie evidence
of corruption” on Zuma’s part, but that any legal proceedings were likely to be
unwinnable.
On the face of it, those two statements are wholly contradictory, but in the
absence of Ngcuka giving any further details, the strength of the “evidence” and
the “winnability” of any prosecution are impossible to verify.
That leaves Zuma is facing the second to worst case scenario. Commenting after
Ngcuka’s findings were made known, he pointed out quite correctly: “The
statement is equivalent to a judgment against me.”
Resignation Calls
The reality of that situation lost on the opposition parties. The main opposition
Democratic Alliance (DA), which holds 66 seats in the 400-member parliament
as against the ANC’s 266, immediately called on Zuma to stand down,
describing him as “fatally wounded.”
That sentiment was echoed by the far smaller United Democratic Party (UDP),
which issued a statement saying that Zuma would now be regarded “as a corrupt
official.”
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And worse is likely to come. Although Zuma is not going to be charged, his
financial adviser, Schabir Schaik, is, leaving him facing the prospect of a trial in
which although he is not a defendant, he will doubtless be viewed as such by the
population at large.
For the ANC, that is only slightly less unfortunate than if Zuma had been
prosecuted. It has already suffered a series of high profile corruption scandals,
including the convictions for fraud of the party’s former chief whip, Tony
Yengeni, and the former wife of ex-president Nelson Mandela, Winnie
Madikizela.
Oil Impropriety?
Meanwhile, in late July, the government was forced to issue a denial of any
wrongdoing in response to newspaper claims that a lucrative Nigerian oil deal—
lobbied for personally by President Thabo Mbeki—ultimately brought financial
benefits only to an offshore Cayman Islands company whose sister company
boasted a number of close relatives of senior ANC figures among its list of
shareholders.
While there appears to be little direct evidence of any impropriety on Mbeki’s
part, the reality is that graft—added to widespread disillusionment at the
government’s failure to tackle crime, socioeconomic inequalities, and the
HIV/AIDS crisis facing the country—is yet another issue that is likely to have a
deleterious impact on the ANC’s electoral showing come next year.
Government Stability
Presidential Power Struggle?
Aside from its possible electoral consequences, the Zuma affair could yet prove
to be the start of a major power struggle within the ANC hierarchy.
Despite the myriad problems facing it, it is inconceivable that the ANC will not
win next year’s elections. Consequently, Mbeki, incidentally a close ally of
Zuma’s, is all but assured of a second term in office. However, that is his
constitutional lot.
That means that provided Mbeki does not move to amend the constitution—an
issue that has itself been the subject of some speculation of late—South Africa is
due for a new president in just over five years time.
Before these latest developments, Zuma was a fair bet for securing that position,
while his most likely rival was the former ANC secretary general turned
businessman, Cyril Ramaphosa.
Ramaphosa, it may be recalled, was a leading light in the ANC under Mandela,
and was widely tipped as his potential successor until he quit politics for
business when it became clear that Mbeki was to be anointed. His return to top
flight politics was confirmed in December last, when he was elected to the ANC
executive committee.
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September 2003
Now, with Zuma all but certainly out of the running, Ramaphosa must be
regarded as the most likely successor to Mbeki.
Interestingly, in the latter stages of the Scorpions’ investigation, Ramaphosa was
called upon by the ANC to “mediate” the situation. However, in mid-August, he
declined that role. Commenting on his decision, he said: “When I was initially
approached I indicated that I needed to understand what the issues are and the
terms of the process before agreeing to get involved…I have had a discussion
with Mr. (Bulelani) Ngcuka and have decided not to play any role in this matter
as I believe that the mechanisms, legal and otherwise, to resolve the various
issues are in place.”
Outside of that, Ramaphosa refused to elaborate on the discussions between
himself and Ngcuka.
While it would be pure speculation to suggest that anything underhand took
place, it is noteworthy that the findings that spared the ANC the embarrassment
of Zuma being tried while simultaneously wrecking his chances of succeeding
Mbeki were delivered by Ngcuka just a week later.
*
156
*
*
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ZIMBABWE
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
33.5
29.5
11.5
37.3
V.Low
Current
09/03
38.0
21.0
9.5
34.3
V.Low
One Year
Ahead
Worst Best
Case
Case
25.0
60.0
20.0
25.0
10.0
25.0
27.5
55.0
V.Low High
Five Years
Ahead
Worst Best
Case
Case
25.0
70.0
18.0
30.0
25.0
32.0
34.0
66.0
V.Low Mod.
POLITICS
Internal Conflict
Just when it appeared that the dire political situation in Zimbabwe might be
headed towards improvement, President Robert Mugabe’s Zimbabwe African
National Union–Patriotic Front (Zanu-PF) government issued a ruling that could
not only scupper the nascent political reconciliation that has taken place of late,
but endanger the food aid that around five million Zimbabweans currently
depend upon.
Food Aid Row
The ruling in question, announced by Social Welfare Minister July Moyo on
August 19, effectively reverses the government’s policy of allowing the UN
World Food Program (WFP) and other international charities to distribute food
aid directly to those in need. Instead, aid agencies were informed that they are to
hand over food supplies to rural government officials and village chiefs, who
will then decide on distribution priorities.
On the face of it, that move could be viewed simply as a means of ensuring that
those with good local knowledge take on the responsibility of getting aid to the
most needy within their locales.
Local Election Manipulation
However, the real motivation for the change is likely to be more sinister.
Zimbabwe is due to hold local elections at the start of September and Zanu-PF is
keen to make sure that it wins handsomely.
Hence the food aid decision. In the March 2002 presidential election that
resulted in Mugabe’s now infamous re-election, government food stocks were
given only to Zanu-PF supporters. In countless well documented instances,
supporters of the main opposition Movement for Democratic Change (MDC)
were chased away from food queues by Zanu-PF thugs, often literally leaving
them to starve.
This time around, as a result of the dismal failure of Mugabe’s forced land
redistribution policy to lead to any appreciable agricultural output, the
government has no food stocks of its own with which to bribe voters.
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Consequently, it wants to take charge of the aid being donated by the
international community. However, as at August 25, it was far from clear that
the new arrangement would go ahead, after the WFP threatened to halt all
deliveries of food aid into the country unless it retained the power to distribute
the aid through its own officials.
Given the tragic consequences that would follow such a cessation of supply, it
must be hoped that Mugabe will capitulate. However, his reputation is one of
total disregard for human life, and an obsessive belligerence towards anything he
regards as external interference to his rule.
If that attitude holds sway again, not only do millions of the world’s most
impoverished people face a period of even greater desperation, but the recent
faint glimmers of progress on the political front look set to be extinguished.
Political Progress?
Those glimmers began to show in late July when, for the first time in three years,
MDC members of parliament (MPs) chose not to boycott Mugabe’s speech to
the opening legislative session.
The move followed weeks of bitter clashes as Mugabe sent his security forces
onto the streets to crack down on striking protestors who had brought what little
remains of the country’s economy to a standstill. Among those arrested was the
MDC leader, Morgan Tsvangirai, who was charged with treason for trying to
overthrow Mugabe and remanded in custody on June 10.
Treacherous Tsvangirai
That was Tsvangirai’s second treason indictment, as he already stands accused,
along with two other senior MDC members, of plotting to assassinate Mugabe in
what is regarded internationally as a farcical invention of the Mugabe regime.
At the time of his arrest for the second treason charge, he was on bail from his
trial in the first. In mid-June, that trial heard that one of the main prosecution
witnesses, the Canadian-based political consultant Ari Ben-Menashe, received a
government contract after supplying videotaped evidence that allegedly shows
Tsvangirai arranging Mugabe’s assassination. What the trial also heard was that
the contract made no mention of a $200,000 fee paid to Ben-Menashe in advance
of it being signed.
In the light of that evidence, Tsvangirai’s lawyers appealed to the High Court to
have the charges against him dismissed. However, in late August, the court
deferred its ruling on the issue.
Meanwhile, Tsvangirai was bailed on his second treason charge on June 21, on
the condition that he desists from calling for the removal of Mugabe. When, or
if, he will face trial on those charges remains unclear.
However, with him back on the streets, the MDC’s stance appeared to soften, as
was underlined by its failure to boycott Mugabe’s speech. Commenting on the
decision, MDC information department chief Paul Themba Nyathi said: “We
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believe we owe it to the nation and all the people who elected us to take bold
steps in creating a political environment conducive to successful dialogue.” In
addition, he expressed his hope that the move would lead to “amicable
negotiations” on Mugabe’s retirement; something that the great man has ruled
out.
Shortly after making those comments, Nyathi was briefly detained by the police
in relation to MDC campaign posters depicting Mugabe as a thief running away
from an angry crowd.
As to the goodwill gesture made by the MDC in attending the opening of
parliament, Mugabe initially ignored it, using his speech to warn those who
would destabilize the country that they will face “the full wrath of the law.”
However, he did not call the opposition legislators present any disparaging
names (something of a first), and at a later banquet for legislators, he described
their presence at the opening as a forward move.
Talks?
From there, things really did appear to progress. By late July, church leaders
were expressing confidence that their efforts, aided by those of other African
states, including Nigeria, South Africa, and Malawi, to bring the two sides to the
negotiating table would soon bear fruit.
Mugabe
Then, on July 31, Mugabe ordered top Zanu-PF officials who grabbed more than
one farm during the land seizure program to return their excess lands for
redistribution to lower ranking members. In part, the move was simply an
exercise in keeping the lower orders in line, but that Mugabe felt confident
enough to order the higher echelons, including some ministers, to hand over all
but one of their farms is indicative of the power he still commands within ZanuPF.
Rather more surprising was that, at the same time, the government published a
list of some 418 farmers whose land had been confiscated under the land seizure
program, inviting them to apply for compensation. Not that there is any
compensation available, of course. Mugabe maintains that that is the
responsibility of the former colonial power, the UK.
MDC Offer
That move coincided with another encouraging development when the MDC
announced that it would consider suspending its legal challenge to Mugabe’s
2002 re-election if the government were to open negotiations that would lead to
concrete political progress.
The dropping of that challenge, which is due to be heard in November this year,
has long been a government pre-requisite for the holding of talks with the MDC.
Consequently, the MDC’s offer did not break the deadlock entirely, as it requires
the talks to get underway first, and only offers suspension pending their final
resolution, but it did indicate that the gap between the two sides had started to
narrow.
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Cash Crunch
Helping to drive that narrowing is Zimbabwe’s dire economic situation.
Unemployment is running at around 70%, while inflation is in excess of 350%.
Rapid price increases have led to a shortage of banknotes so severe that early
August saw riots in the capital, Harare, as those lucky enough to have jobs tried
to withdraw their paychecks from banks without any notes.
In response to the crisis, the government imposed limits on the amount of cash
individuals are allowed to have, and the central bank announced that it is to issue
travelers checks for local use until the government succeeds in raising sufficient
funds to pay for banknotes to be printed abroad.
Needless to say, any additional funds in the form of international aid are unlikely
to resume until a solution to the political crisis is at least in prospect. So, the
idea of negotiation with the MDC is becoming increasingly attractive to the
government. However, if it goes ahead with its food aid plans in order to
manipulate the outcome of the local elections, the chances of the MDC being
prepared to meet it halfway will doubtless diminish markedly.
ECONOMY
IMF Assessment
The International Monetary Fund (IMF) completed its latest assessment of the
economy in early June this year. Suspending Zimbabwe’s voting and related
rights with the organization for failing to make payment arrears or implement
policy agreements, it painted a grim picture of the last four years, noting that real
output has dropped by a third over that period, that capital and labor flight has
been substantial, and that little in the way of investment has been made, despite
the government’s expansionary fiscal policy.
The overall budget deficit declined to 5% in 2002 from 10% of GDP in 2001.
However, quasi-fiscal operations related to support schemes for gold and
tobacco producers through the Reserve Bank amounted to more than 5% of
GDP. Meanwhile, the external position has become increasingly constrained.
Pervasive shortages of foreign exchange in the official market, partly owing to a
35% plunge in exports since 2000, have resulted in a compression of non-food
imports of 15%.
At end-2002, gross usable reserves stood at US$15 million, equivalent to three
days of imports, and arrears to external creditors amounted to US$1.5 billion, or
29% of total external debt, including to the IMF. The government responded to
these pressures in November 2002 by tightening exchange controls, increasing
surrender requirements, and closing exchange bureaus. These actions resulted in
a slowdown of foreign exchange flows to the official market and an appreciation
of the parallel market exchange rate in early 2003.
NERP
In response to the deteriorating economic situation, the government adopted a
National Economic Revival Program (NERP) at end-February 2003, after
consultation with business and labor under the auspices of the Tripartite
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September 2003
Negotiating Forum (TNF). Immediate actions included a massive devaluation of
the exchange rate from Z$55 per US$1 to Z$824 per US$1 (although the
government will still purchase foreign exchange at the old rate), a doubling, on
average, of fuel prices, and sectoral policies to stimulate production.
These actions were followed by some rise in interest rates, an increase in the
producer prices of grain in March, and another doubling of fuel prices in April.
In early May, controls on most prices were removed. Prices of five basic food
items remain controlled, but were increased by substantial amounts.
Zimbabwe: Selected Economic Indicators, 1999-2002
1999
2000
20011
(percentage change)
Real economy
Real GDP (market prices)
-4.1
-6.8
-8.8
Consumer prices (end of period)
56.9
55.2
112.1
Government finances
Revenue, excluding grants
Expenditure and net lending
Overall balance,
excluding grants and arrears
Primary balance, excluding grants
Money and interest rates
Broad money
(M3, end of period; percentage change)
91-day treasury bills (annualized yield)
Balance of payments
Exports
Imports
Current account balance
(excluding official transfers)
(In percent of GDP at the official
exchange rate) 2
(In percent of GDP at world prices) 3
Overall balance
Reserves and Debt
Usable reserves
(millions of U.S. dollars; end of period)
(months of imports of goods and
services)
Total external debt (percent of GDP at
official exchange rate; end of period) 2
Total external debt (percent of GDP at
world prices; end of period) 3
Debt service (percent of exports of goods
and services)
26.4
36.2
-9.8
(percent of GDP)
28.2
26.8
51.2
37.3
-23.0
-10.4
20021
-12.8
198.9
28.3
33.1
-4.8
0.0
-5.4
0.0
-0.1
29.8
59.9
102.7
164.8
89.7
71.6
25.9
26.6
(billions of US dollars; unless otherwise
indicated)
1.93
2.19
1.61
1.42
-1.68
-1.85
-1.78
-1.82
0.01
0.04
-0.39
-0.48
0.3
0.6
-4.2
-2.5
0.2
-0.03
0.5
-0.21
-4.9
-0.42
-6.7
-0.42
46.7
22.1
20.0
15.1
0.2
0.1
0.1
0.1
86.5
73.0
55.8
26.8
55.8
59.3
64.0
72.8
22.8
24.3
29.5
31.0
Source: IMF, July 2003.
1-IMF estimate. 2- Foreign currency units are converted into Zimbabwe dollars at the official
exchange rate. 3- GDP at world prices using real GDP growth and trading partner countries'
inflation (base year is 1996).
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September 2003
International Country Risk Guide
September 2003
ASIA
AND
THE PACIFIC
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September 2003
CURRENT RISK ASSESSMENTS AND FORECASTS
COUNTRY
Australia
Bangladesh
Brunei
China, Peoples' Rep.
Hong Kong
India
Indonesia
Japan
Korea, DPR
Korea, Rep
Malaysia
Mongolia
Myanmar
New Zealand
Pakistan
Papua New Guinea
Philippines
Singapore
Sri Lanka
Taiwan
Thailand
Vietnam
CURRENT RATINGS
Political
Financial Economic
Risk
Risk
Risk
09/03
09/03
09/03
85.5
35.5
41.0
48.0
39.5
38.5
82.0
50.0
44.5
70.5
45.5
38.5
75.5
44.0
43.5
59.0
44.0
35.0
51.5
34.5
36.5
85.5
50.0
37.5
50.5
26.5
30.0
79.0
42.0
40.5
71.5
41.0
39.0
71.0
31.5
25.0
47.5
39.5
32.5
91.0
30.5
41.5
49.0
40.5
37.5
53.5
35.0
30.0
68.0
36.5
35.5
86.5
45.5
44.5
59.0
37.0
31.0
76.0
47.0
43.0
71.5
39.5
40.0
65.5
38.5
35.5
Year
Ago
10/02
83.0
60.8
88.3
74.8
84.3
65.8
58.0
85.0
46.8
80.0
76.8
64.0
62.3
79.5
58.5
62.0
71.0
90.0
63.3
82.5
76.3
70.3
COMPOSITE RATINGS
Current
Forecasts
Rating
One Year
Five Year
09/03
WC
BC
WC
BC
81.0
77.5
83.0
73.0
87.0
63.0
60.5
69.5
54.5
71.0
88.3
76.5
81.5
74.5
83.0
77.3
74.5
78.5
67.0
80.5
81.5
71.5
77.5
65.5
81.5
69.0
59.5
69.0
56.0
73.5
61.3
45.0
59.0
46.5
68.5
86.5
82.0
88.0
78.0
92.0
53.5
25.0
44.0
26.5
61.5
80.8
64.5
83.3
61.5
86.5
75.8
69.0
77.5
64.0
79.0
63.8
60.5
67.0
54.0
69.5
59.8
51.0
57.5
42.5
63.0
81.5
79.3
83.8
75.5
88.0
63.5
49.5
60.0
46.5
64.0
59.3
52.5
61.5
51.5
66.0
70.0
60.5
71.0
61.5
74.5
88.3
81.0
85.0
64.5
85.5
63.5
50.5
70.0
50.0
74.0
83.0
77.5
89.5
67.5
86.5
75.5
66.0
73.5
58.0
75.5
69.8
66.0
71.5
62.5
75.0
For historical risk ratings and key economic data on these and other countries in ICRG, please go to
www.CountryData.com.
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INDIA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
56.0
41.0
34.5
65.8
Mod.
Current
09/03
59.0
44.0
35.0
69.0
Mod.
One Year
Ahead
Worst Best
Case
Case
50.0
63.0
40.0
44.0
29.0
31.0
59.5
69.0
High
Mod.
Five Years
Ahead
Worst Best
Case
Case
50.0
67.0
34.0
45.0
28.0
35.0
56.0
73.5
High
Low
POLITICS
Government Stability
With a series of state elections due in November this year, Sonia Gandhi’s
opposition Congress Party tabled a motion of no confidence in Prime Minister
Atal Behari Vajpayee’s Bharatiya Janata Party (BJP)-led government in midAugust.
According to Gandhi, the motion was driven by the government’s “brazen
corruption,” and “arrogance,” which “is a danger to the basic tenet of our
constitution.”
The corruption to which she was referring centers on a scandal that first emerged
in 2001, when an internet news site released video footage in which bribes were
apparently received by a host of officials in connection with a fake arms deal.
The affair led to the resignation of the then BJP president, Bangaru Laxman,
along with four senior defense officials.
One of those to resign was George Fernandes, who later rejoined the government
and is currently the minister for defense.
The no-confidence motion followed the Defense Ministry’s refusal to publish the
findings of a report into the arms allegations on the grounds of national security.
However, according to Congress, the publication was blocked by Fernandez as
part of a deliberate cover-up by the government.
In the event, the no-confidence motion was easily defeated by the governing 24member National Democratic Alliance (NDA), which controls 323 of the 543
seats in the Lower House, as against the 140 held by Congress. The final vote
was 312 to 186 against the motion.
State Elections Loom
In truth, the degree to which that alleged cover-up was the real driving force
behind the no-confidence motion is open to some question. The greater
likelihood is that that issue was simply a convenient peg on which to hang a vote
that Congress hopes will have embarrassed the BJP as it prepares for
forthcoming state elections.
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All of those elections are to take place in Congress-held states: Rajasthan;
Chattisgarh; New Delhi, and Madhya Pradesh. If the BJP were to fare well in
these contests, the likelihood is that Vajpayee would bring the national elections
scheduled for November next year forward by several months in a bid to
capitalize on the party’s electoral momentum.
In order for that to happen, the BJP would probably have to unseat Congress in
at least two of the state elections; an achievement that would run counter to its
electoral form over the last year or so, during which it has lost out to Congress
on several occasions, most recently in February this year, when the opposition
took control of Himachal Pradesh state.
That said, there are those within the BJP that point to India’s stable economic
growth rate, low inflation, and handsome foreign reserve position as favoring an
early election. Consequently, the debate on the timing of the general election
has been taking place within the party since June this year.
A further debate has centered on the possibility of the party standing alone in the
next national election, although given its weak run of state election results thus
far, the likelihood must be that that option will be shelved in favor of another
NDA pre-poll coalition.
Congress looking for Friends
Congress also now appears to recognize the potential benefits of such coalitions.
Addressing a party meeting in the northern town of Shimla in early July, Gandhi
said: “Taking into account the present political scenario, Congress would be
prepared to enter into appropriate coalition or alignment with secular parties on
the basis of mutual understanding.”
The likelihood of such a secular alliance being formed remains unclear. Most
opposition parties reacted to her statement with caution, with the only firm
response coming from the Communist Party of India (CPI)—and that was a
rejection.
That said, Congress now has considerable experience in coalition building at the
state level, and if it retains control of the four states in the forthcoming elections
by a handsome margin, several opposition parties might see the idea of joining
forces with it for the national contest in a positive light.
One drawback to that eventuality is that Gandhi is not Indian-born; a factor
already highlighted by the Samajwadi Party, which has previously said that it
would support Congress provided that she was not the prime ministerial
candidate of any alliance.
Not surprisingly, the staunchly nationalist BJP looks set to exploit that issue in
its state election campaigns. Kicking off those campaigns in late July, the party
unveiled a 25-point platform aimed at highlighting its economic achievements.
However, the party also launched a personal attack on the Italian-born Gandhi,
who was described as “an inexperienced leader of foreign origin, who has
[made] no contribution towards the nation worth mentioning.”
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In tandem with those comments, the BJP also committed itself to pursuing
another highly nationalistic—and divisive—issue: the building of a Hindu
temple at Ayodhya, in the northern state of Uttar Pradesh.
Taken together, those issues tend to negate BJP President Venkaiah Naidu’s
assertions that the party “can return to power on the basis of the government’s
performance.” Rather, they suggest that the BJP is gearing itself up for a bitter
series of electoral battles.
Internal Conflict
Religious Tensions
In those terms, the Ayodhya temple issue is of particular significance in that the
BJP’s blatant exploitation of it led to the party’s re-election in the December
2002 elections in Gujarat state.
At the heart of the Ayodhya row is the demolition of the city’s 16th century Babri
mosque by Hindu zealots in 1992. The justification for that act was that,
according to many Hindus—not least members of the BJP and its even more
hardline ally, the World Hindu Council (Vishwa Hindu Parishad-VHP)—the
Ayodhya site was originally home to a temple marking the birthplace of the
Hindu God, Ram, which they claim was razed by Muslim invaders who then
built the mosque in its place.
The sectarian violence that followed the destruction of the mosque led to some
3,000 deaths.
Ayodhya-related violence returned to in early 2002 when a train carrying Hindu
pilgrims back from the city to Gujarat was set on fire, killing 59. Muslims were
blamed and at least 1,000 people, mostly Muslims, died in the ensuing riots
before the government finally stepped in to halt the carnage. It just so happened
that this outbreak of violence preceded elections in Gujarat state, raising
accusations that The BJP supported the VHP’s action in order stoke up
nationalist passions among its Hindu support base.
The violence in 2002 led the central government to pass the problem of the
religious origins of the Ayodhya site to the Supreme Court. Earlier this year the
Court ruled that no religious activities could take place on the disputed site until
archaeological excavations had been carried out to determine the site’s religious
antecedents. That ruling has stayed any further outbreaks of violence so far, but
the sectarian situation in the state remained tense.
Unfortunately for the BJP and VHP the initial findings of the archeological
investigations, which were widely reported in early June, showed no evidence of
any Hindu temple on the site. The High Court allowed an extension of the
excavation timeframe so that further excavations could be carried out. Later
evidence of an ancient structure emerged, but there was no still confirmation that
the remains were those of an ancient Hindu temple.
Despite that the BJP had already committed itself to pressing ahead with the
construction of a Hindu temple on the site; a decision confirmed by Vajpayee
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September 2003
himself on August 1 when he expressed his confidence that obstacles to the
passage of a law allowing the “construction of the temple will be removed and
the temple will be built.”
Finally, on August 25, the archaeological survey of India (ASI) came up with the
answer the BJP had been waiting for. It reported that an ancient Hindu temple
did indeed exist on the disputed Ayodhya site long before the mosque was built.
However, that finding is by no means the end of the matter. Secular historians
are likely to dispute the ASI's conclusions, and the High Court still has to rule on
whether a new Hindu temple can be constructed on the ruins of the old mosque.
Just to add fuel to the flames of incipient Muslim protest, at the very time the
ASI’s report was released the Uttar Pradesh chief minister, Mayawati,
announced her resignation. Mayawati, who only goes by one name, heads the
Bahujan Samaj Party (BSP), to which the BJP gave its support as a junior
coalition partner following inconclusive results in the state’s 2002 elections.
Announcing her decision, Mayawati cited a row with her BJP colleagues as the
reason for her resignation. Now that she is going, the likelihood is that Uttar
Pradesh will hold fresh elections, which will doubtless be accompanied by still
greater levels of nationalistic tub-thumping over the Ayodhya issue by the BJP—
and the strong possibility of another round of inter-religious violence.
Terrorism
On August 25, shortly after the ASI’s report, two car bombs exploded at separate
sites in the city of Mumbai (Bombay), India's financial capital. At least 51
people were killed and around 156 injured, many seriously.
The first bomb exploded shortly after 1pm local time in the Zaveri bazaar, a
famous gold and jewellery market in the south of the city. The second bomb was
detonated a few minutes later outside the Gateway of India—the city's most
famous tourist attraction. Both bombs were hidden in taxis.
That same night police claimed they had also discovered a large amount of
explosive concealed near a railway tunnel on the outskirts of Bombay. Around
100 detonators had been hidden along a busy commuter line at Igatpuri.
As always in India the finger of suspicion after incidents such as these turns
immediately to Pakistan, or rather to Pakistan's Inter-Services Intelligence (ISI),
which is accused by India of training, equipping, and directing the various
Islamic terrorist groups operating in Indian-controlled Kashmir and beyond.
When gunmen open fire in India's parliament complex in December 2001,
following a suicide bomb attacks on the Kashmir assembly building the previous
October, India immediately put the blame on groups it claimed were supported
by the ISI. The rapid deterioration in relations following the attack saw both
countries put their formidable armies on a war footing.
Pakistan was quick to distance itself from the Bombay outrage. Speaking only
hours after the incident, Pakistan Foreign Ministry spokesman Masood Khan
told reporters: “We deplore these attacks...We condemn all acts of terrorism and
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I think that such wanton targeting of civilians should be condemned in the
strongest possible terms.”
Within hours, the Indian authorities had fingered two Islamic organizations as
being responsible for the attacks, the Students Islamic Movement of India (SIMI)
and Lashkar-e-Taiba (LeT). Formed in 1977 in Uttar Pradesh, SIMI is a homegrown militant Islamist group that aims to “liberate” India through forced
conversion to Islam. LeT, on the other hand, is the largest Pakistan-based group
operating in divided Kashmir region. It draws many of its fighters from
Pakistanis who formerly fought the Russians in Afghanistan and has been
fighting Indian security forces in Indian-controlled Kashmir since 1989. India
accuses LeT and another Pakistan-based militant group of being responsible for
the December 2001 attack on India's Parliament.
On top of that, the police quickly determined that the explosive used in the
Bombay bombings was RDX. Indian security officials say RDX is almost
always used by Islamic militants in Kashmir; it was also used in a wave of
explosions that shook Bombay in 1993, killing 250 people.
The BJP was, of course, quick to play up the implied role of Pakistan in the
killings and to downplay any contribution played by its own strident Hindu
nationalism. When Deputy Prime Minister L.K. Advani toured the site of the
explosions on August 26, he claimed that the police had recovered the bodies of
two Pakistani nationals involved in the 1993 bomb attacks and accused Pakistan
of sheltering them. He also implied that Pakistan was now involved in a wider
campaign to destabilize India, saying: “I would say our neighbor’s war of
terrorism against us is not directed only against Jammu and Kashmir.”
A Pakistani foreign ministry statement called Mr Advani's comments “baseless
and irresponsible” and added, “It serves no purpose to point accusing fingers
towards Pakistan and even worse to try to make domestic political capital from
such a gruesome tragedy.”
Indeed, the Pakistani government might be right to feel aggrieved over such
accusations, as the real causal factors of the bomb attacks are probably rather
closer to home than Pakistan. Although the attacks probably came too quickly
after the release of the ASI’s finding's to be directly related, they do follow a
bomb attack on a Bombay commuter train in March this year, which killed 12
people and wounded 75, which many see as linked to the Ayodhya dispute.
Also, only two days before the blasts the man widely held to be responsible for
the carnage in 2002, Gujarat's BJP chief minister Narendra Modi, paraded the
ashes of an obscure Hindu nationalist freedom fighter through the streets of
Bombay. While the gesture delighted the Hindu nationalist Shiv Sena, Bombay’s
former ruling party, it caused a good deal of discontent within the city’s large
Muslim community.
In short, the BJP and its allied Hindu nationalists had provided more than a little
provocation for the Islamist terror groups to strike the city. The difficulty for
Pakistan is that because it is responsible for training and supplying these groups
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to fight for the “liberation” of Kashmir, it inevitably has to share part of the
blame when they carry out attacks which the Pakistani government has not
approved and might even see as counterproductive.
External Conflict
Pakistan
The wider concern about the Bombay outrage is its possible effect on IndoPakistani relations, which had been making steady progress since Vajpayee’s
surprise mid-April call for an improvement in ties.
The degree to which that call has been heeded in Islamabad was again
underlined in mid-August, when Pakistan’s president, Pervez Musharraf, offered
an immediate ceasefire along the so-called line of control (LoC) that separates
the Indian and Pakistani controlled portions of the disputed state of Kashmir.
Addressing a group of Indian members of parliament (MPs) taking part in a
peace mission to Pakistan, Musharraf said: “We are fighting each other daily.
Daily there are casualties on both sides. There has got to be a ceasefire.” He
added that he could give the orders for such a ceasefire “today,” and that India
should follow suit.
For the time being at least, that is not going to happen, but the fact that
Musharraf has raised the idea of a cessation of hostilities across the LoC
suggests that talks between the two countries over Kashmir, ownership of which
has caused two wars between them in the past and almost led to a third in 2002,
are now closer than has been the case for some considerable time.
India too insists that a peaceful solution must be found. In a statement read out
to the same peace conference addressed by Musharraf, he said: “Violence and
bloodshed cannot provide any solutions. We can live together only if we let each
other live…Cooperation, rather than confrontation, is the answer to our
common problems.”
And it isn’t just talk. In late June, Pakistan’s new ambassador to India took up
his post, a move that was reciprocated in mid July and formalized the restoration
of diplomatic ties, agreed between the pair back in May this year.
Meanwhile, mid-July also saw the resumption of bus services between Delhi and
Lahore. Like diplomatic ties, transport links between the two countries were
suspended in late 2001 after an attack on the New Delhi parliament by Pakistanibacked militants, which in turn led to the 2002 standoff. Now, talks are
underway on the resumption of air and railroad links, and were expected to bear
fruit in the fairly near future.
Even so, the major stumbling block to substantive talks on a solution to the
Kashmir problem remains the terrorist attacks carried out by the militant Muslim
groups inside India. India maintains that these groups are supplied and trained
from within Pakistan, and that a complete cessation of terrorist attacks is an
absolute prerequisite to bilateral negotiations; a position that Prime Minister
Vajpayee reiterated in response to Musharraf’s ceasefire call.
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ECONOMY
The International Monetary Fund completed its latest assessment of India’s
economy in July this year. It estimates that real GDP growth in 2002/03 slowed
to 4.3% from 5.5% in 2001/02. The primary reason for the slowdown was a
decline in agricultural output as a result of drought. The effects of that drought
on edible oil prices was also cited, along with higher global oil prices, as a factor
behind the increase in inflation experienced during the first half of 2003,
although overall, consumer price inflation in 2002/03 is estimated to have been
4%, down from the 4.3% registered in 2001/02. For 2003/04, GDP growth is
expected to rebound to around 5.5% on the back of a recovery in agriculture,
while inflation is forecast to post around 4.5%.
India: Selected Economic Indicators 1
1998/99 1999/00 2000/01 2001/02
(In percent)
Domestic economy
Change in real GDP at factor
6.5
6.1
4.4
5.6
cost
Change in industrial production
4.1
6.6
5.0
2.7
Change in wholesale prices
6.0
3.4
7.1
3.4
Change in consumer prices
13.1
3.4
3.8
4.3
(In billions of US dollars)
External economy
Merchandise exports 2
34.3
37.5
44.9
44.9
Merchandise imports 2
47.5
55.4
59.3
57.6
Current account balance
-4.0
-4.7
-3.6
0.8
(In percent of GDP)
-1.0
-1.1
-0.8
0.2
Direct investment, net 3
2.4
2.1
3.3
4.7
Portfolio investment, net
-0.1
3.0
2.6
2.0
Capital account balance
8.4
10.4
10.0
10.6
Gross official reserves 4
32.5
38.0
42.3
54.1
(In months of imports) 5
5.8
6.0
6.9
7.7
External debt (in percent of
23.4
22.0
21.9
20.5
GDP) 4
Short-term debt (in percent of
2.7
2.8
2.3
3.0
GDP) 4 7
Debt service ratio (in percent of
19.1
17.8
15.3
9.5
current account receipts)
Change in real effective
-4.6
1.1
6.2
1.7
exchange rate (in percent) 4
(In percent)
Financial variables
Central government balance (in
-5.5
-5.5
-5.7
-6.3
percent of GDP) 8
General government balance (in
-8.8
-9.9
-9.9
-10.5
percent of GDP) 8
Change in bank credit to
14.5
18.3
15.8
11.3
commercial sector
Change in broad money 4
19.4
14.6
16.8
14.2
Interest rate 4 9
8.7
9.2
8.7
6.1
2002/03
4.3
5.8
3.6
4.0
53.0
65.5
3.7
0.7
3.6
0.9
12.6
75.4
9.2
20.1
3.0
14.1
-5.6
-6.0
-10.0
19.6
15.0
5.9
Source: IMF, August 2003.
1- Data are for April-March fiscal years. 2- Balance of payments basis. 3- Net foreign direct
investment in India less net foreign investment abroad. 4- End of period. 5- Imports of goods
and services projected over the following twelve months. 6-/ IMF estimates for 2002/03. 7Residual maturity basis, except contracted maturity basis for medium- and long-term nonresident
Indian accounts. 8-/ Excluding divestment receipts from revenue and onlending of small saving
collections from expenditure and net lending. 9-91-day Treasury Bill rate.
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KOREA, REPUBLIC
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
76.5
40.0
43.5
80.0
V.Low
Current
09/03
79.0
42.0
40.5
80.8
V.Low
One Year
Ahead
Worst
Best
Case
Case
62.0
80.0
37.0
42.5
30.0
44.0
64.5
83.3
Mod. V.Low
Five Years
Ahead
Worst
Best
Case
Case
65.0
82.0
30.0
45.0
28.0
46.0
61.5
86.5
Mod. V.Low
POLITICS
External Conflict
North Korea
After the latest round of shuttle diplomacy aimed at resolving the issues
surrounding the Democratic People’s Republic of Korea’s nuclear weapons
program, late August saw a six-way meeting take place in the Chinese capital,
Beijing. Present were delegations from both the Democratic People’s Republic
(DPRK or North Korea) and its southern neighbor, the Republic of Korea (South
Korea), as well as from China, Japan, Russia, and the USA.
However, it quickly became clear that the positions of the main protagonists,
North Korea and the USA, were unchanged.
The standoff between the two began in October last year when the US
government claimed that North Korea had admitted to having nuclear weapons
and a secret uranium enrichment plant. That claim was apparently confirmed by
the North Korean government when initial talks between it and its US
counterpart took place in April this year.
Those talks resulted in little progress, with North Korea demanding that the USA
sign a non-aggression pact and normalize political and diplomatic relations with
it. For its part, the US administration refused to undertake such steps ahead of
North Korea’s “verifiable and irreversible” abolition of its weapons program.
Six Way Talks
At the latest talks, North Korea put forward a blueprint for solving the crisis,
under which it would pledge not to manufacture nuclear weapons, allow UN
inspectors access to its nuclear sites, end missile developments, and ultimately
dismantle its nuclear facilities.
However, as its prerequisite for taking those actions, North Korea again called
on the USA to sign a non-aggression treaty, arguing that its nuclear program is a
necessary deterrent in the light of US President George Bush’s now infamous
description of it as part an “axis of evil” and the US-led preemptive attack on
another country in that axis, Saddam Hussein’s Iraq. In addition, Pyongyang
called for guarantees of economic cooperation with Japan and South Korea.
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Predictably, the USA ruled out any major moves ahead of North Korea getting
rid of the weapons it is believed to possess, which in turn led Pyongyang to
reportedly threatening to carry out a full nuclear test and declare its nuclear
arsenal officially.
As the talks came to an end, North Korea accused the USA of intransigence and
initially ruled out a further round of discussions that were expected to take place
in October this year. However, on September 2, Pyongyang changed its view to
and said that it remained committed to solving its problems with the USA
“through dialogue.”
In part at least, the DPRK’s willingness to keep open the door to negotiation has
been driven by pressure from China, which although its closest ally, has publicly
stated its opposition to North Korea becoming a nuclear power. However, it is
not clear how far China is prepared to go in restraining its neighbor. Although
wary of the regional consequences of a nuclear North Korea and the USA’s
likely reaction to it, rumors of China considering sanctions such as the
suspension of oil supplies are for the time being just that; rumors.
Piggy in the Middle
Meanwhile, South Korea finds itself in the position of flotsam, being tossed on
the tides of powers that are beyond its control. For President Roh Moo-hyun,
that presents considerable difficulties.
On coming to office in February this year, he pledged to continue the so-called
“Sunshine Policy” of improving relations with the north that was established
under his predecessor, Kim Dae-jung. However, doing so in the midst of the
current crisis has proved extremely difficult, especially given that South Korea is
home to a US military force of some 37,000 troops.
US Troops
Currently, those troops are mainly concentrated in the border region between the
two Koreas, which are still technically at war as a result of the armistice that
ended their 1950-1953 conflict. However, back in June this year, the USA
announced plans for the withdrawal of its forces from the border region to more
central locations.
On one hand, such a pullback can be seen as a positive move in that it will make
the presence of US forces less obvious to both North Korea and the large number
of South Koreans who are concerned at their country’s close relationship with
the USA.
However, it can equally be seen as an early sign of Washington’s pessimism
regarding the wider situation. Deployed along the border, US troops would be in
the front line of any attack launched by North Korea, which keeps some twothirds of its 1.1 million strong army (the fifth largest in the world) in the border
region. In that situation, US casualties would likely be high, leading to a forced
retreat to more southern positions before mounting a counter attack.
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Consequently, the withdrawal of US forces from the demilitarized zone (DMZ)
that separates the two Koreas could be construed as a deliberate preparation for a
possible conflict by situating troops in positions from which they could mount a
counter attack without first having to suffer heavy losses.
That is certainly the view Pyongyang has taken of the plan, which also includes
sweeping improvements to intelligence collecting, wholesale weapons upgrades,
and the deployment of special US rapid reaction forces.
From North Korea’s point of view, allowing a foreign army to prepare for war
against it is a long way from pursuing Kim’s “Sunshine Policy.” Meanwhile, the
situation also has domestic political implications for Roh, whose own
Millennium Democratic Party (MDP) is a deal less enthusiastic about US
involvement than the unashamedly pro-American opposition Grand National
Party (GNP), which holds a majority, 151 seats, in the 272-member legislature.
That leaves Roh in a position in which his acceptance of US moves alienates him
from his MDP constituency, while the GNP’s harsher attitude towards North
Korea severely constricts his ability to pursue “engagement” policies.
In short, despite his claim to be able to act as a mediator between the USA and
North Korea, Roh actually finds himself at the mercy of those two nations and
without a firm political support base at home.
Little wonder then, that he is particularly keen to see China play a more
prominent role in reining in the DPRK before the tit-for-tat saber rattling by
Pyongyang and Washington reaches the point at which some kind of conflict
becomes inevitable. If that was to happen, Roh’s continuation of Kim’s
“Sunshine Policy” would be in tatters, as would his career.
The unfortunate reality of Roh’s position is that outside of browbeating the USA
and China, there is little he can do to influence the situation. Consequently, he
will doubtless be hoping that if the October meeting does take place, the
intervening period will have thrown up at least some avenues for compromise.
Internal Conflict
Labor Unrest
Meanwhile, the possibility of a fresh round of industrial action was raised in late
August when the legislature approved a labor bill reducing the working week
from 44 hours to 40, effectively ending the practice of working half days on
Saturdays. On the face of it, such a move might be expected to draw support
from trade unions. However, responding to it, the Federation of Korea Trade
Unions (FKTU) described it as “malicious.”
The reason for the FKTU’s anger is that in addition to cutting the working week,
the legislation also reduces the number of public holidays. According to the
federation, the law reflects only the wishes of big business, and it warned in a
statement: “It will be the trigger of a fresh round of labor disputes. We will
wage an all-out battle against the managers and lawmakers.”
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That could spell serious trouble for the economy, which has already suffered
from the effects of a series of work stoppages this year.
Rail Strike Ends
The most recent of those stoppages came to an end on July 1, when railroad
workers protesting the government’s privatization plans for the industry returned
to work. The move came after the government toughened it stance towards the
strike, deeming it to be illegal and refusing to enter into talks with the railroad
unions.
In addition, the government pushed through an amended rail privatization bill.
Although a watered down version of the original legislation, unions fear that
thousands of jobs will be lost as private companies are allowed to take over some
of the state-controlled railroad’s operations.
Despite those concerns, railroad union chief, Chun Hwan-kyu, announced the
end of the strike on July 1 and apologized to people for the inconvenience it had
caused them. The move followed late June warnings from the government that
workers who did not report back to work would face disciplinary proceedings
and possible dismissal.
From the government’s point of view, breaking the rail strike was an important
indicator to the business community of its commitment to reform. That
commitment had previously been brought into question back in April, when the
government narrowly averted a rail strike by backing down on its initial
privatization plans.
Now, it would seem that the government has tried to use the momentum built up
by beating the railroad unions to press ahead with the working week changes.
The potential problem that raises is that South Korea’s unions are powerful
beasts that are unlikely to allow themselves to be steamrollered. Consequently,
the outlook for labor relations over the coming months is at best unsettled and at
worst potentially destabilizing.
*
*
*
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PAPUA NEW GUINEA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
57.0
36.5
30.5
62.0
Mod.
Current
09/03
53.5
35.0
30.0
59.3
High
One Year
Ahead
Worst Best
Case
Case
48.0
55.0
28.0
35.0
29.0
33.0
52.5
61.5
High
Mod.
Five Years
Ahead
Worst Best
Case
Case
48.0
58.0
27.0
38.0
28.0
36.0
51.5
66.0
High
Mod.
POLITICS
Government Stability
Cabinet Reshuffle
Prime Minister Michael Somare marked the eve of his first anniversary in office
by carrying out a long-expected cabinet reshuffle on August 2, in which seven
new ministers were appointed.
Papua New Guinea (PNG) has a multitude of political parties, many of which are
simply vehicles for one or more individuals, and a multitude of independents
whose support, basically, is open to the highest bidder. At the mid-2002
elections that saw Somare win the premiership, his National Alliance Party
(NAP) won just 19 of the 109 seats in parliament, making it necessary for him to
fashion a coalition government. In doing so, he made certain promises in terms
of ministerial positions to the main parties that agreed to join forces with the
NAP.
Coalition Tensions
However, tensions within the coalition began building at the beginning of this
year over Somare’s tardiness in fulfilling those promises. More recently, even
some members of his own party have been openly critical of his leadership.
Back in late June, the governor of Madang province, James Yali, who is a
leading member of the NAP, openly said that he would be one of the first to vote
against Somare in the event of a no-confidence motion being tabled. In making
his comments, Yali explained that aside from failing to honor the “major
commitments” made to coalition partners, Somare had allowed “a number of
senior government ministers to politically bully and control him.”
Yali was not alone in his criticisms, which were swiftly supported by the
Governor Bani Hoivo of Oro and Governor Carlos Yuni of Sandaun. Both are
also NAP members and pledged to back any move by Yali against Somare’s
premiership.
Partnership Pact
With the NAP facing possible collapse, Somare received something of a boost on
June 27 when two of the main parties in the coalition; the People’s Action Party
(PAP), and the People’s Progress Party (PPP) signed a declaration of partnership
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with him in a bid to stabilize the government as a whole. Commenting on the
pact, the parties’ founders, Ted Diro and Julius Chan respectively, urged their
members of parliament (MPs) to remain united and to avoid “personalizing”
issues because, in the words of Chan, “politics is like a snake in the grass that
turns its skin overnight.”
On the face of it, Chan and Diro’s support looked to have the makings of a backroom deal between the pair and Somare. However, any suspicions of that being
the case looked to have been scotched—at least insofar as Chan was
concerned—when the PPP did not receive any new posts in the reshuffle that
followed.
The New Appointments
That shakeup saw the NAP lose four ministries, bringing its total tally down to
eight. Internal Security Minister Yawa Silupa and Environment Minister Sasa
Zibe were among those to lose their jobs, being replaced by the United Party
(UP) leader Bire Kimisopa, and William Duma from the United Resources Party
(URP) respectively.
The remaining changes saw the PAP’s Roy Biyama take on the higher education,
research, science, and technology portfolio, and Nick Kuman of the People’s
National Congress (PNC) go to culture and tourism. The Privatization Ministry
now goes under the name of the State Enterprises and Information Ministry and
is headed up by Arthur Somare.
Meanwhile, the People’s Labor Party (PLP) leader, Peter Yama, finally saw
Somare’s commitment to reward his support realized when he was offered the
labor and industrial relations portfolio. He replaced Peter O’Neill, who took on
the previously vacant post of public services minister. O’Neill also retained his
position as leader of government business. As to the PPP, Robert Kopaol was
dropped as lands and physical planning minister in favor of his party colleague,
Michael Nali.
Those changes leave the party tally of ministerial positions as follows: The NAP
has eight, including the premiership; the PPP and PAP have four each; the PNC
has three; the Melanesia Alliance, the PLP, and the URP two each; and the
Papua and Niugini Unity Party (PNUP), the UP, and the National Party (NP) one
each.
In a further personnel change, Mari Kapi was named as the country’s new chief
justice on August 14. He replaces Arnold Amet, under whom he served as
deputy. Amet’s ten-year tenure came to an end on August 16.
Commenting on the reshuffle, Somare said that it had been made in the interests
of stability and that he does not expect to be making any further alterations “for
a long while yet.”
Democratic Accountability
Now that Somare’s reshuffle has fulfilled his pledges to coalition member
parties, he will doubtless be eager to press ahead with his plans for altering the
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rules that govern elections and political party memberships. Somare contends
that the PNG’s use of a first-past-the-post voting system, coupled with its large
number of tiny parties and independent legislators, makes election to parliament
something of a lottery that in turn leads to an inherently unstable political entity.
So, he proposes that when the next elections are held in 2007 a preferential
voting system is used in order to give a more balanced view of the wishes of the
electorate. In addition, the changes would prevent successful independent
candidates from joining political parties unless they do so within a few weeks of
being elected. Under the current system, independents have the potential to play
kingmakers through patronage of a given party.
Somare believes the changes will bring greater stability to the political system.
However, perhaps understandably, they are viewed with suspicion by many of
those who might lose out as a result. Prior to the reshuffle, Somare’s hopes of
rallying sufficient legislative support to force through the changes were faint, but
now that he has fulfilled his end of the deal with regard to his coalition member
parties, the prospects look a deal brighter.
That said, the constitutional nature of the changes means that they will require a
two-thirds majority in the legislature to become law; something that still appears
to be out of reach without the support of the very independents that are most
likely to suffer.
Internal Conflict
Bougainville
Meanwhile, the peace process on the island of Bougainville continues to
progress. Earlier this year, Australia and New Zealand announced their intention
to withdraw the peacekeeping troops they had deployed in Bougainville,
following the signing of the 2001 peace agreement between the government and
most of the rebel groups by the end of June. This forced the government to
redouble its efforts to ensure that the disarmament process provided for under
the peace agreement was completed ahead of those withdrawals.
In the event, the peacekeepers did withdraw on time, to be replaced by a civilianonly body; the Bougainville Transition Team (BTT), which is charged with
overseeing the establishment of an autonomous government for the province.
UN Arms Verification
As for the disarmament the UN verified in late July that it had reached stage two
of the process, with over 1,800 weapons collected. That UN certification has
opened the way for the BTT to begin its work on elections to the island’s new
government, although the timing of those elections remains unclear.
What does appear clear is that the government has now dropped its insistence
that the weapons issue be thoroughly resolved ahead of the formation of the new
government.
In fact, the UN certification represents something of a fudge. Back in May this
year, Acting Bougainville Affairs Minister Sam Akoitai cited the figure of 1,800
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September 2003
weapons as equivalent to around 80% of those believed to be in circulation.
However, even before that assessment, the government had indicated that rather
than hold fast to its earlier demand that all weapons must be handed in prior to
the establishment of the new administration, the figure of 80% would be
sufficient for the disarmament process to move on to stage three; the disposal of
the said weapons.
The UN concurred, saying that the level of security rather than the number of
weapons declared should be the determining factor in moving the process
forward. Now it would seem that that is to be the case. No decision on the
future of the weapons, which are being held in secure containers under UN
supervision, is now expected until some months after the new government is in
place. Meanwhile, the issue of the remaining 20% of weapons, numbering some
400, looks to have been dropped.
Rebel Intransigence
For all of the encouraging signs coming out of Bougainville, that could yet prove
to be a dangerous oversight. Just a day after the withdrawal of the peacekeeping
forces, hard-line Me’ekamui fighters under the control of Francis Ona, the leader
of the guerrilla Bougainville Revolutionary Army (BRA), issued a statement
saying that they will remain outside of the peace process until the government is
prepared to negotiate on independence.
Ona’s forces still control much of central Bougainville, which is effectively a nogo zone. Given that, and the likelihood that the weapons that have not been
handed in are in the hands of that group, the outlook for peace in Bougainville is
a deal less certain than the UN certification might suggest.
The Solomons
That uncertainty is further compounded by the fact that the PNG has given its
support, and some 90 troops, to Australia’s new peacekeeping effort in the
Solomon Islands, which lie to the east of the PNG and border Bougainville. That
effort began in early August.
Throughout the Bougainville conflict, links between separatist forces there and
on the Solomon Islands have been rumored to exist, with both sides apparently
seeking shelter and storing weapons in each others’ territory. Since Australian
troops left Bougainville, rumors have been rife that the Solomon Islands warlord,
Harold Keke, has visited the island with the aim of building up resources of
weapons and men with the help of BRA dissidents.
Bougainville’s governor, John Momis, refutes those allegations, but the
possibility that, under pressure from the Australian led force deployed on the
Solomon Islands, Keke and his rebels might choose to stage a tactical retreat into
Bougainville—and in the process spark fresh conflict there—cannot be ruled out.
Despite Momis’s assertions, the government’s decision to send PNG troops to
the Solomons was at least in part in recognition of that possibility, and those
forces are likely to spend much of their time monitoring traffic between the
islands.
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ECONOMY
Meanwhile, the PNG’s fiscal relations with Australia look set to undergo a
deterioration if Canberra makes good on its early August threat to reassess it’s
A$300 million (US$198 million) a year aid program to the country.
According to Australian Foreign Minister Alexander Downer, the review will
examine the manner in which the money is being spent, and whether or not it
could be better directed towards ameliorating service delivery and law and order
problems. Downer added that Australia was not considering reducing the overall
amount of aid it supplies.
Somare, who lambasted Downer’s comments as tantamount to blackmail, will
doubtless be hoping that there is indeed no overall reduction in Australian aid.
Budget Deficit
The reason is that the PNG’s finances are in dire straits after three straight years
of real GDP contractions.
However, that has not been the only difficulty. Last year saw the budget deficit
miss its 3.4% of GDP target as a result of overspends on wages and the elections.
According to the government, the final deficit for 2002 stood at 4.1% of GDP.
However, in its most recent assessment of the state of play, carried out in June
this year, the International Monetary Fund put the figure at 5.5% of GDP.
Meanwhile, the outlook for this year is hardly less gloomy. Commenting in the
wake of the Australian review threat, Finance and Treasury Minister Bart
Philemon conceded that a further tightening of expenditure will in any case be
necessary this year if the government is to meet its budget deficit target of 2% of
GDP.
He explained that the primary reason is that some PNGk200 million ($59
million) in privatization receipts, and a further PNGk140 million ($41 million) in
public sector reform aid from the Asian Development Bank (ADB) have not
been realized, leaving a PNGk340 million ($100 million) shortfall in revenues.
Accordingly, Philemon said that he will table an amendment to the 2003 finance
bill during September, which will sharply reduce expenditure across the board.
Papua New Guinea: Selected Economic Indicators, 1998-2002
1998
1999
2000
2001
(percent change)
Real sector
Real GDP growth
-3.8
7.6
-1.3
-3.4
Mineral
16.8
10.0
-4.0
-0.6
Non-mineral
-8.1
6.9
-0.5
-4.2
CPI (annual average)
13.6
14.9
15.6
9.3
CPI (12 months)
21.8
13.2
10.0
10.3
Central government budget
Revenue and grants
180
29.2
(percent of GDP)
29.3
31.3
30.6
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2002
-3.1
-9.6
-1.3
11.8
14.8
29.6
International Country Risk Guide
September 2003
Papua New Guinea: Selected Economic Indicators, 1998-2002
1998
1999
2000
2001
Expenditure and net lending
31.0
32.4
32.8
34.5
Overall balance, cash basis
-0.4
-4.3
-1.4
-4.1
(including grants) 1
Domestic financing, net 2
1.4
2.0
0.9
0.9
Of which: Banking system
1.7
1.2
-1.4
-2.5
External financing, net
-1.2
2.0
0.2
3.2
Privatization, net
0.2
0.3
0.3
0.0
(end-period percentage change)
17.1
4.0
-4.5
-12.3
15.4
11.2
-12.5
-26.1
29.0
10.5
3.0
-1.2
2.5
8.8
5.4
1.9
23.9
20.4
14.9
10.2
Money and credit
Domestic credit
Net credit to government
Credit to the private sector
Broad money
Interest rate
(182-day T-bills, end-period)
Balance of payments
Exports, f.o.b.
Imports, c.i.f.
Current account (including grants)
(In percent of GDP)
Overall balance
Reserves and external debt
Gross international reserves
(In months of non-mining imports, cif)
Public external debt-to-GDP ratio
(in percent) 3
Public external debt-service ratio
(percent of GNFS exports)
Exchange rates
US$/kina (period average)
US$/kina (end-period)
2002
33.7
-5.5
4.9
5.3
-1.3
1.8
20.9
82.0
-6.3
4.2
13.5
1,848
-1,425
22
0.6
-190
(US$ millions)
2,019
2,214
1,878
-1,525 -1,503 -1,269
53
232
174
1.5
6.7
6.0
-36
8
66
1,624
-1,225
-74
-2.7
-96
187
1.8
35.6
(end-period, US$ million)
206
304
440
2.2
4.2
6.1
42.2
41.8
51.4
343
4.5
54.4
7.3
7.5
6.7
7.1
7.4
0.4856
0.4770
0.3922
0.3710
0.3624
0.3255
0.2965
0.2658
0.2490
0.2488
Source: IMF, June 2003.
1-Measured from below the line in the fiscal accounts. 2-Includes changes in check float.
3-Central government and Bank of Papua New Guinea.
*
*
*
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SRI LANKA
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
61.0
35.5
30.0
63.3
Mod.
Current
09/03
59.0
37.0
31.0
63.5
Mod.
One Year
Ahead
Worst Best
Case
Case
45.0
68.0
28.0
38.0
28.0
34.0
50.5
70.0
High
Low
Five Years
Ahead
Worst Best
Case
Case
45.0
72.0
27.0
38.0
28.0
38.0
50.0
74.0
High
Low
POLITICS
Internal Conflict
The Peace Process
For all concerned, the fragile peace process between Prime Minister Ranil
Wickramesinghe’s government and the rebel Liberation Tigers of Tamil Eelam
(LTTE) entered a crucial phase in late August, when rebel delegates traveled to
France to begin discussions on the government’s latest proposals for the
governance of the Tamil-dominated north and east of the country.
The rebels, who have been engaged in a 19 year old conflict that is estimated to
have cost some 65,000 lives, are not expected to make a formal response to those
proposals until mid-September, after which it is hoped negotiations with the
government will resume.
Talks between the two sides last broke down in April this year, after the rebels
accused the government of failing to devote sufficient resources to the
regeneration of Tamil areas and rejected Wickramesinghe’s proposal for the
establishment of a development council to oversee that process. Rather, the
rebels argued, the task of rehabilitation should fall to a provincial administration
in which the LTTE would hold the balance of power.
Wickramesinghe ruled out such a body as unconstitutional; a move that led the
LTTE to boycott an early June meeting of international donors in Tokyo that was
intended to raise funds to support the peace process and implement poverty
alleviation programs.
Donors’ Meeting
Despite the LTTE’s non-attendance, the meeting took place as scheduled and
resulted in aid pledges of some $4.5 billion over three years, the largest of which
came from Japan and the Asian Development Bank (ADB), which pitched in
with $1 billion each.
The total figure raised exceeded earlier expectations of around $3 billion in
pledges, but was in line with a World Bank report that estimates that $1.5 billion
is needed for the reconstruction of Tamil areas and that poverty reduction
measures will require a further $3 billion.
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Commenting on the largesse of the donors, Wickramesinghe said: “I must
confess that even the most optimistic among us would not have expected this…It
will lay the foundation for the realization of our goal of a peaceful Sri Lanka in
which all its people could live in harmony, safety, and dignity.”
However, without fresh peace talks, neither that goal, nor the aid money, will be
forthcoming. All aid pledges were made conditional on concrete progress
towards peace taking place, which will be under the close monitoring of those
countries stumping up the funds.
For its part, the LTTE made no public response to the funding pledges, but Sri
Lankan peace groups drew cautious parallels with Afghanistan, which was
promised a similar amount of money at a similar Tokyo meeting, but has yet to
receive more than a fraction of it.
Provisional Administrative Council
Despite those qualms, the success of the meeting gave fresh impetus to
Wickramesinghe’s efforts to lure the LTTE back to the negotiating table.
To that end, he indicated to the donors’ meeting that his government was
prepared to reverse its earlier position and allow amendments to the constitution
that would permit the establishment of a provincial administration in the north
and east in which the LTTE would have “a significant role.”
However, the rebels remained unimpressed, accusing Wickramesinghe of using
the international community to pressurize them into submission and refusing to
re-enter talks until “a clearly defined draft framework” for the proposed
administration was presented.
In its June 10 statement, the LTTE added that the vague nature of the plans made
them indistinguishable from the government’s previous position, with the only
exception being an alteration in the terminology used to describe what it
maintained was the government’s originally proposed development council.
Ceasefire Violations
Within days, the situation had taken a further turn for the worse. On June 14, a
rebel vessel exploded during a confrontation with a Sri Lankan navy patrol off
the northeastern port town of Trincomalee. According to the navy, only warning
shots had been fired, but the rebels claimed that the ship had been attacked, in
violation of the ceasefire that was agreed between the two sides back in February
2002. All 12 people aboard the vessel were killed.
Also on June 14, a senior member of the anti-LTTE Eelam People’s Liberation
Front (EPLF) was shot dead by a sniper. Despite being a Tamil organization, the
EPLF has been outspoken in its criticism of the rebels, as has the Eelam People’s
Democratic Party (EPDP), which saw one of its number, Ponniah
Ramachandran, gunned down on the following day.
The LTTE was blamed for both killings, and for the later murder June 23 of a
policeman in the capital, Colombo.
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Norwegian Mediation
At that point, the outlook for the ceasefire, let alone a resumption of talks,
appeared bleak. However, behind the scenes, negotiators from Norway, which
has been mediating the conflict since early 2002, were said to have been
facilitating secret discussions between government and LTTE representatives.
The fruits of those talks began to emerge in mid-July, when the government put
forward a draft proposal for the administrative council “for discussion.”
According to the draft, the Provisional Administrative Council (PAC) would
consist of government and opposition members, with the majority of posts being
held by nominees of the LTTE. Significantly, the council would have political
and administrative control over the distribution of funding for reconstruction and
resettlement in Tamil areas—a key rebel demand—but would not be responsible
for security or land, and would have no revenue raising powers.
Commenting on the draft, government spokesman G.L. Peiris said that he was
confident that final details could be worked out “face to face” with the rebels and
that talks would resume “within weeks.”
Despite that confidence, the process suffered further hiccups in late July when
the Norwegian team again accused the rebels of violating the ceasefire by
refusing to dismantle a camp in a government-held area, and in mid-August
when a Tamil informant was shot dead; presumable by the LTTE.
Those setbacks, and a series of fatal attacks against Muslims living in the
northeast (see Ethnic Tensions below), aside, hopes for a positive outcome to the
government’s efforts were raised when the rebel delegation, headed up by the
group’s political leader, S.P. Thamilselvan, left for France on August 20 to meet
with constitutional experts to discuss the draft proposals.
Outlook
The obvious question now is whether or not the LTTE will go for the PAC as
outlined in those proposals. Unfortunately, the answer is difficult to gauge,
given the lack of firm details available. On the face of it, the LTTE’s earlier
claims that the PAC is little more than a revamped version of the development
council that it has already rejected still look to be valid.
That would tend to suggest that another setback is in the offing. However,
despite claiming to be the sole voice of Sri Lanka’s 3.2 million Tamils, the
LTTE is not. Now that the offers of international aid are firmly on the table, if
the rebels jeopardize that aid by walking out on a deal that appears to give them
the leading role in the dispersal of that aid, the LTTE’s standing in the Tamil
community will doubtless be dented, to the likely benefit of politically more
mainstream groups like the EPLF and EPDP.
That would tend to suggest that there will now a resumption of formal talks
between the government and rebels.
However, whichever way the LTTE jumps, wider difficulties that will doubtless
figure in the LTTE’s calculations lie ahead.
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Government Stability
Not least of those is the position of President Chandrika Kumaratunga. She
heads up the People’s Alliance (PA) and as such is in opposition to
Wickramesinghe’s government. The most ardent aspect of that opposition
centers on the peace process, which Kumaratunga has long regarded as too
heavily skewed towards the demands of the LTTE.
The real difficulty facing Wickramesinghe is that Kumaratunga has the power to
dissolve his government and call fresh elections if she so chooses. Thus far, she
has shied away from such a move, and has publicly ruled it out. However, that
restraint has been driven more by a desire to avoid being cast as spoiler of the
peace than any acceptance of what is taking place.
As to the latest developments, she has limited herself to dark pronouncements;
accusing the LTTE of preparing imminent attacks and covertly gearing itself up
for a return to war. The latest allegation to emerge from her PA camp came on
August 21 when her spokesman, Harim Peiris, claimed that Black Tiger (the
LTTE’s suicide fighters) squads had infiltrated Colombo and were planning to
assassinate her.
In fairness to Kumaratunga, such a plot is not beyond the bounds of possibility.
Back in 1999, she lost an eye in an LTTE assassination attempt that left 19
people dead. Currently, the rebels doubtless regard her as an impediment to
them achieving their autonomy goals, while Wickramesinghe doubtless sees her
as an impediment to peace.
That perception is not without foundation. Aside from an understandable
personal hostility towards the rebels, Kumaratunga and her supporters have little
time for the mediation efforts undertaken by Norway. In late May this year, one
of her senior aides, Samaraweera, described Norway as “a nation of salmoneaters who turned into international busybodies.” Kumaratunga made no
comment.
Her failure to castigate Samaraweera for his indelicate remarks underlined the
degree to which Kumaratunga was unhappy with the state of play at that point.
Now, Norwegian mediators are on the brink of brokering a fresh deal that is
likely to sit even less well with her. If the LTTE rejects it, she might decide that
the peace process is irretrievable and initiate moves towards a military solution
to the problem. On the other hand, if the LTTE agrees to the PAC, she might
easily decide that its formation is a step too far and, notwithstanding her earlier
pledges, that Wickramesinghe’s government must go.
Ethnic and Religious Tensions
Meanwhile, a further potential problem centers on Sri Lanka’s Muslim
population. Although only accounting for some 8% of the total population,
Muslims make up around a third of those living in the north and east of the
country and are hugely wary of their predominantly Hindu Tamil neighbors.
Consequently, the government’s PAC proposals include representation for both
the Muslim and the majority Sinhalese communities. Back in early July, Muslim
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members of parliament (MPs) gave the government’s plans provisional support.
However, since then, concerns within the Muslim community about the potential
power that the PAC will give to the LTTE have been on the rise, fuelled by a
string of attacks against Muslims apparently carried out by the rebels.
Because of those concerns, the Norwegian mediators want to see a Muslim
delegation take part in any talks on the PAC that might now take place between
the government and the LTTE. However, given that any final agreement will of
necessity give the LTTE the dominant role in the PAC, that is unlikely to prove
sufficient to reassure the Muslim community.
The potential dangers of that situation have increasingly come to the fore, with
late August seeing open discussions within the Muslim community about the
possibility of taking up arms to counter what it sees as the government’s
abandonment of it in the pursuance of peace with the rebels.
Consequently, if the LTTE does agree a deal that gives it political pre-eminence
within the north and east of the country, a Muslim backlash cannot be
discounted.
Government Stability
In addition, Wickramesinghe’s government might again be destabilized. Led by
his United National Party (UNP), that government has a legislative majority of
just two seats. Within its overall representation, the government enjoys the
support of the Sri Lanka Muslim Congress’s (SLMC), which holds 12 legislative
seats. Commenting on Muslim concerns over the PAC in mid-August, SLMC
Secretary General Hashan Ali said “…we want to use all our means to convince
the government that it should never sacrifice the interest of the Muslims.”
The implicit threat is that if the Muslim community finds itself forced to accept
governance by the LTTE, the SLMC might withdraw its support for the central
government and, in doing so, bring it down.
Consequently, while the overall thrust of the peace process continues to move
forwards, substantial problems remain. If the worst case scenarios that flow
from those problems are to be avoided, all sides will now need to be prepared to
accept serious compromises. Whether or not the lure of $4.5 billion in aid will
be sufficient to secure those compromises is by no means certain.
*
186
*
*
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VIETNAM
RISK ASSESSMENTS
Risk Category
Political Risk
Financial Risk
Economic Risk
Composite Risk
Risk Band
Year
Ago
67.5
36.0
37.0
70.3
Low
Current
09/03
65.5
38.5
35.5
69.8
Mod.
One Year
Ahead
Worst Best
Case
Case
63.0
67.0
36.0
39.0
33.0
37.0
66.0
71.5
Mod.
Low
Five Years
Ahead
Worst Best
Case
Case
60.0
69.0
35.0
43.0
30.0
38.0
62.5
75.0
Mod.
Low
POLITICS
Law and Order/Corruption
Nam Cam Trial
The issues of crime and graft returned to the fore in early June when the trial of
Truong Van Cam (better known as Nam Cam) came to a close with him being
convicted of masterminding a vast criminal organization and the murder of a
rival gang member. He received two death sentences, although as at mid-August
those sentences, and the numerous years in jail handed down to him for other
crimes, were awaiting appeal, as were his convictions. Similar appeals have
been lodged by the other five Nam Cam gang members, who were also sentenced
to death. None of the appeals is expected to succeed.
Meanwhile, the wider significance of the trial, which was the largest in
Vietnam’s history, was that no fewer than 154 other people stood accused of
aiding and abetting Nam Cam’s activities, including several senior police
officers, prosecutors, and members of the ruling Communist Party of Vietnam
(CPV), all of whom were alleged to have protected his racketeering network,
which centered on gambling, prostitution, and protection.
CPV Convictions
The most senior CPV figures to be convicted were the former head of state radio,
Tran Mai Hanh, who was sentenced to 10 years in jail, and the former deputy
national chief prosecutor, Pham Sy Chien, who was sentenced to six years. Both
were found guilty of accepting bribes from Nam Cam to secure his early release
from a labor camp in the mid-1990s. In addition, the former vice minister of
public security, Bui Quoc Huy, received four years imprisonment for ignoring
Nam Cam’s activities while he was the police chief of Ho Chi Minh City.
All three were also banned from taking government jobs for five years after
release.
The convictions of those three, and a host of other lower-ranking officials who
received various jail terms, underlined the degree to which the CPV was
subverted by the activities of Nam Cam’s operations. Now, the government
hopes that the trial’s outcomes will send a clear signal that corruption will not be
tolerated and that much of it has been cleared away.
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That is particularly important in terms of Vietnam’s international standing,
which the government has been keen to enhance in order to draw in foreign
investment and aid.
However, as with any crime, for every criminal convicted several more go
unpunished. Consequently, while Nam Cam has gone, the likelihood is that
there remain a significant number of officials who escaped censure and might
again be tempted to indulge in corrupt practices.
Anti-Drug Crackdown
Aside from graft, another issue that the government is keen to crack down on is
that of drug-related crime. To that end, early June saw the launch of a major
anti-drug campaign dubbed the “Month of Action for Drug Control.” As part of
the campaign, the Public Security Ministry, Defense Ministry, and Customs
Office were ordered to coordinate the activities of border guards and marine
police in a bid to prevent trafficking into the country, while the domestic police
force was told to redouble its efforts to detain drug dealers and to set about the
eradication of opium poppies throughout the country.
As to users, the government has adopted a slightly softer line, pledging more
funds for drug detoxification and rehabilitation programs, to be coordinated by
the Ministry of Labor, War Invalids, and Social Affairs.
The crackdown on trafficking has enjoyed some early successes. In mid-June,
police in Quang Tri Province announced the country’s biggest ever heroin
seizure, when some 128 bricks of the drug (weighing around 40kg) were found
hidden in a freight truck. According to the police, the discovery, which resulted
in six arrests, including that of the truck driver, marked the destruction of a
major trafficking network that had been importing heroin from neighboring
Laos.
Later in June three Australians of Vietnamese descent were arrested after being
discovered trying to smuggle heroin into Australia. The men were caught
packing the drug into the loudspeakers at the factory at which they worked.
Those arrests followed the June 12 sentencing of two Vietnamese-born
Australian women on trafficking charges. Phan Thi Kim Phuong was sentenced
to life imprisonment, while her 14-year old sister, Phan Thi Ngoc Phi, received a
four-year sentence. The pair had been hired to work as “mules,” transporting
just over half a kilogram (approximately one pound) of heroin inside their
bodies.
External/Internal Conflict
Human Rights
Aside from graft and drugs, a further issue that is of at least passing concern to
the government because of its impact on Vietnam’s international reputation is
that of human rights.
There, the government has fared rather less well of late.
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Back in May, the European parliament passed a motion calling on Vietnam to
honor its commitments under the international treaty on civil and political rights,
which it signed some 20 years ago. In doing so, the parliament demanded that
Vietnam stop its oppression of ethnic minorities and followers of unauthorized
religious groups, as well as putting an end to controls on the use of the internet
to watch foreign satellite broadcasts, the arbitrary arrest of journalists, and
detentions without trial—all of which are carried out in the name of national
security.
The motion was significant in that aid and trade between the EU and Vietnam is
worth some $5 billion a year. However, the government remained intransigent,
trotting out its oft-repeated claim that Vietnam has no political prisoners, only
criminals, and that allegations of human rights abuses are the work of those who
seek to undermine national unity.
Buddhist Groups
Supporting that position, the state-controlled daily newspaper, Nhan Dan,
responded to the European motion by pointing to the celebrations held to mark
Buddha’s birthday on May 15, and the conferring by President Tran Duc Luong
of the country’s highest civil honor; the Independence Order, First Class, on the
Chairman of the Vietnamese Buddhist Church (VBC), Thich Tam Tich.
According to Nhan Dan the move confirmed the “traditionally close relations
between Buddhism and the Vietnamese population.”
To a degree, that assertion appears reasonable. However, the VBC is the only
officially sanctioned Buddhist organization in Vietnam. Several others also exist
and it is those groups that the European parliament accuses the government of
repressing.
Not least of those groups is the Unified Buddhist Church of Vietnam (UBCV),
whose leader, Thich Huyen Quang, has been under effective house arrest since
the group was outlawed in 1981.
The oppression of UBVC priests was again highlighted in mid-August over the
case of a monk, Thich Tri Luc, who had been granted UN refugee status while in
Cambodia, but was apparently forcibly returned to Vietnam where he is to face
trial.
According to the US-based group, Human Rights Watch (HRW), which has long
been a leading critic of the Vietnamese regime, Luc was spirited out of
Cambodia on July 25 by “an unidentified Vietnamese man.” His trial was
originally set for August 1, but was later postponed for an indefinite period.
The revelations regarding Luc were particularly unfortunate for the government
because despite its outward irritation over the European parliament motion, it
had appeared to be adopting a softer line towards the UBCV. In early May,
Thich Huyen Quang was allowed to meet with his deputy, Thich Quang Do for
only the third time since the UBVC’s proscription. Then, in late June, Do was
exempted from house arrest. According to the government, he was released
ahead of schedule in order to further “national unity and humanitarian policy.”
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Commenting on Luc’s predicament, Do subsequently said that he had committed
no crime and was “a victim of gross injustice and arbitrary detention.” The
government made no official comment.
The Central Highlands
Aside from Buddhists, another group that falls foul of the government and is the
subject of international human rights concerns is the Montagnard Christian
movement, which predominates in the Central Highlands province.
Tensions in the province have been high since early 2001, when peaceful
demonstrations calling for religious freedoms and land redistribution were
brutally suppressed by the military. Since then, the situation inside the Central
Highlands has been difficult to asses, because the government has effectively
placed the area under martial law and prevented independent monitors and
journalists from entering it.
However, according to information smuggled out of the region in early July, the
government has been involved in mass human rights abuses. Included within the
allegations made is the claim that upwards of 1,000 women have been subjected
to forced sterilization procedures as part of a campaign of ethnic and religious
cleansing.
The government vehemently denies these claims. In mid-May, Deputy Prime
Minister Nguyen Tan Dung praised the government’s reconstruction efforts in
the province, saying that during the first quarter of this year some 10,000 jobs
had been created and that numerous social projects were underway, including
house building and the construction of a major hydroelectric plant.
Meanwhile, in mid-August, the government announced plans for the Central
Highlands to receive wider access to television and radio services broadcast in a
number of ethnic languages. The services will of course be run by the statecontrolled broadcaster.
Because of the lack of independent monitoring of the situation in the Central
Highlands, which the European parliament also demanded be addressed, the
conflicting claims of the government and the groups claiming to speak for the
Highlanders are impossible to verify. However, the government’s refusal to
allow such monitoring tends to suggest that all is not as rosy as Dung would have
people believe.
Internet Dissident Jailed
Aside from exhibiting religious and ethnic intolerance, the government is far
from pleased about the opportunities for the dissemination of information
presented by the internet.
Those concerns were again highlighted in mid-June, when a doctor, Pham Hong
Son, was sentenced to 13 years in jail for emailing documents deemed to be
“against the CPV and the state” to fellow pro-democracy activists overseas.
According to the US State Department, which “strongly” condemned the “harsh
sentence given to Pham Hong Son for merely expressing his views on the
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Internet,” the documents in question were Vietnamese translations of an article
entitled “What is Democracy?” that was posted on the State Department’s
website.
According to human rights groups, Son is the fifth so-called “cyber-dissident” to
be punished by the authorities. Around one million of Vietnam’s 80-millionstrong population is estimated to access the web, mainly through internet cafés.
ECONOMY
According to figures released by the government in early July, GDP growth
during the first six months of this year posted 6.9%, despite the impact of the
Severe Acute Respiratory Syndrome (SARS) virus and the weakened global
economic situation.
In separate figures released in early June, the government said that industrial
production value increased by 15.6% during the first five months of the year
compared to the same period in 2002, with substantial increases in all economic
sectors; the state-owned sector grew 11.9%, the non-state sector, 18.6%, and the
foreign-invested sector, 17.4%.
Meanwhile, imports and exports maintained high growth rates in the first five
months, with export value rising by 31.3% year on year, representing 44.4% of
the government’s full year target. Within that figure, rice exports increased by
47.4%, crude oil exports by 40%, and garments and textiles, by 69.5%.
Import values over the first five months rose by 38.9% year on year, equivalent
to 48.8% of the full year target.
On foreign direct investment (FDI), the government said some 235 projects,
capitalized at $633 million were attracted during the first five months,
representing a year on year capital increase of over 30%.
*
*
*
Reproduction without permission of the Publisher is strictly forbidden
191
International Country Risk Guide
192
Reproduction without permission of the Publisher is strictly forbidden
September 2003
International Country Risk Guide
September 2003
INDEX
OF
COUNTRY REPORTS
Reproduction without the permission of the publisher is strictly prohibited
193
International Country Risk Guide
194
Reproduction without the permission of the publisher is strictly prohibited
September 2003
International Country Risk Guide
September 2003
INDEX OF COUNTRY REPORTS
AUGUST 2003 - SEPTEMBER 2002
This is a moving index covering the 12 months prior to the current issue. The column headings
indicate the month and year of the issue, with the most recent issue in the left-hand column.
Country reports within an issue are indicated by they symbol ‘X’. The symbol ‘-’ indicates no
report in the issue.
Country
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, P.R.
Colombia
Congo D.R.
Congo, Rep
Costa Rica
Cote d’Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Rep.
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
08/
03
X
X
X
X
X
X
X
X
X
X
X
-
07/
03
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
-
06/
03
-X
X
X
X
X
X
05/
03
X
X
X
X
X
X
X
X
X
X
X
X
-
04/
03
X
X
X
X
X
X
X
X
X
X
X
X
X
-
03/
03
X
X
X
X
X
X
X
X
X
02/
03
X
X
X
X
X
X
X
X
X
-
01/
03
X
X
X
X
X
X
X
X
X
X
X
X
-
12/
02
X
X
X
X
X
X
X
X
X
X
Reproduction without the permission of the publisher is strictly prohibited
11/
02
X
X
X
X
X
X
X
X
X
X
X
-
10/
02
X
X
X
X
X
X
X
X
X
X
X
X
X
-
09/
02
X
X
X
X
X
X
X
X
X
X
X
195
International Country Risk Guide
Country
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Rep.
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
196
08/
03
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
07/
03
X
X
X
X
X
X
X
X
X
X
X
X
-
September 2003
06/
03
X
X
X
X
X
X
X
X
X
X
X
X
-
05/
03
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
-
04/
03
X
X
X
X
X
X
X
X
X
X
-
03/
03
X
X
X
X
X
X
X
X
X
X
X
X
-
02/
03
X
X
X
X
X
X
X
X
X
X
X
X
X
-
01/
03
X
X
X
X
X
X
X
X
X
-
12/
02
X
X
X
X
X
X
X
X
X
X
X
X
-
Reproduction without the permission of the publisher is strictly prohibited
11/
02
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
-
10/
02
X
X
X
X
X
X
X
X
X
X
-
09/
02
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
-
International Country Risk Guide
Country
Nigeria
Norway
Oman
Pakistan
Panama
Papua N Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Fed.
Saudi Arabia
Senegal
Serbia-Montenegro
Sierra Leone
Singapore
Slovak Rep.
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tob.
Tunisia
Turkey
Uganda
Ukraine
United Arab Emir’s
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Rep.
Zambia
Zimbabwe
08/
03
X
X
X
X
X
X
X
X
X
-
07/
03
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
-
September 2003
06/
03
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
05/
03
X
X
X
X
X
X
X
X
X
X
X
-
04/
03
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
-
03/
03
X
X
X
X
X
X
X
X
X
X
X
X
02/
03
X
X
X
X
X
X
X
XX
-
01/
03
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
-
12/
02
X
X
X
X
X
X
X
X
X
X
X
X
-
Reproduction without the permission of the publisher is strictly prohibited
11/
02
X
X
X
X
X
X
X
X
X
X
-
10/
02
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
-
09/
02
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
197
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198
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September 2003
International Country Risk Guide
September 2003
STATISTICAL
SECTION
Reproduction without the permission of the publisher is strictly prohibited
S-1
International Country Risk Guide
S-2
Reproduction without the permission of the publisher is strictly prohibited
September 2003
International Country Risk Guide
September 2003
TABLE 1
COUNTRY RISK, RANKED BY COMPOSITE RISK RATING
(September 2003 versus October 2002)
Rank in
09/03
Country
1
1
1
4
4
6
7
7
7
10
11
12
13
14
15
16
17
17
19
20
21
21
23
24
25
26
26
Luxembourg
Norway
Switzerland
Brunei
Singapore
Ireland
Canada
Finland
Sweden
Japan
Kuwait
Austria
Denmark
Netherlands
Belgium
United Arab Emirates
Cyprus
United Kingdom
Taiwan
Germany
Hong Kong
New Zealand
Australia
Korea, Republic
Iceland
Italy
Spain
28
28
28
28
32
33
34
35
35
37
37
39
40
Bahrain
Malta
Oman
Slovenia
Botswana
France
Bahamas
Portugal
Qatar
Czech Republic
Latvia
China, Peoples' Rep.
Chile
Composite
Composite
Risk Rating
Risk Rating
09/03
10/02
Very Low Risk
91.0
91.3
91.0
91.3
91.0
92.0
88.3
88.3
88.3
90.0
87.3
89.0
86.8
84.8
86.8
89.5
86.8
84.0
86.5
85.0
86.3
81.5
86.0
86.0
85.8
87.8
85.5
85.5
85.3
84.5
84.5
82.0
83.8
80.8
83.8
82.5
83.0
82.5
81.8
83.5
81.5
84.3
81.5
79.5
81.0
83.0
80.8
80.0
80.3
79.3
80.0
80.5
80.0
80.8
Low Risk
79.8
80.3
79.8
79.8
79.8
79.8
79.8
79.8
79.5
79.8
79.0
82.0
78.8
76.0
78.5
79.3
78.5
79.3
78.3
76.3
78.3
75.0
77.3
74.8
76.8
76.3
09/03
versus
10/02
Reproduction without permission of the Publisher is strictly forbidden
Rank in
10/02
-0.3
-0.3
-1.0
0.0
-1.8
-1.8
2.0
-2.8
2.8
1.5
4.8
0.0
-2.0
0.0
0.8
2.5
3.0
1.3
0.5
-1.8
-2.8
2.0
-2.0
0.8
1.0
-0.5
-0.8
2
2
1
7
4
6
12
5
15
11
22
9
8
10
13
20
23
18
18
16
14
32
17
27
33
25
23
-0.5
0.0
0.0
0.0
-0.3
-3.0
2.8
-0.8
-0.8
2.0
3.3
2.5
0.5
26
28
28
28
28
20
42
33
33
39
47
48
39
S-3
International Country Risk Guide
Rank in
09/03
40
40
43
43
45
46
46
48
49
49
49
52
53
53
55
56
57
58
58
58
61
62
63
64
65
65
65
68
69
70
70
72
73
73
75
76
77
77
77
77
81
82
82
82
85
85
S-4
Country
Hungary
Saudi Arabia
Lithuania
Trinidad & Tobago
Namibia
Greece
United States
Malaysia
Poland
Slovak Republic
Thailand
Morocco
Estonia
Russian Federation.
Libya
Tunisia
Israel
Costa Rica
Croatia
Kazakhstan
Mexico
Bulgaria
Panama
Jordan
Iran
Romania
Syria
Philippines
Vietnam
El Salvador
Jamaica
India
Azerbaijan
Ukraine
South Africa
Peru
Albania
Gambia
Guatemala
Yemen, Republic
Bolivia
Algeria
Brazil
Gabon
Egypt
Kenya
September 2003
Composite
Composite
Risk Rating
Risk Rating
09/03
10/02
76.8
77.5
76.8
73.0
76.5
74.0
76.5
72.5
76.3
76.5
76.0
74.8
76.0
75.5
75.8
76.8
75.5
76.0
75.5
75.8
75.5
76.3
75.3
72.5
75.0
75.3
75.0
70.8
73.8
69.5
72.8
72.0
72.5
65.3
72.3
74.8
72.3
72.8
72.3
72.3
72.0
69.8
71.8
71.5
71.5
71.0
71.0
70.0
70.5
63.8
70.5
68.3
70.5
70.3
70.0
71.0
Moderate Risk
69.8
70.3
69.5
71.5
69.5
68.3
69.0
65.8
68.8
67.3
68.8
68.0
68.5
67.5
68.3
68.3
67.0
66.5
67.0
66.3
67.0
67.3
67.0
66.0
66.8
65.8
66.3
61.3
66.3
59.5
66.3
66.5
65.8
66.8
65.8
58.0
09/03
versus
10/02
-0.8
3.8
2.5
4.0
-0.3
1.3
0.5
-1.0
-0.5
-0.3
-0.8
2.8
-0.3
4.3
4.3
0.8
7.3
-2.5
-0.5
0.0
2.3
0.3
0.5
1.0
6.8
2.3
0.3
-1.0
Rank in
10/02
36
52
51
54
38
48
45
37
42
44
39
54
46
62
68
57
84
48
53
56
66
58
60
65
88
69
63
60
-0.5
-2.0
1.3
3.3
1.5
0.8
1.0
0.0
0.5
0.8
-0.3
1.0
1.0
5.0
6.8
-0.3
-1.0
7.8
63
58
69
82
74
72
73
69
77
79
74
80
82
99
110
77
76
116
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
Rank in
09/03
87
87
89
90
91
91
93
94
94
94
97
98
98
100
100
100
100
104
104
106
107
108
108
110
111
112
112
114
115
115
117
118
118
120
121
122
123
123
125
126
127
128
129
130
131
132
Country
Belarus
Suriname
Argentina
Senegal
Moldova
Uruguay
Mongolia
Colombia
Pakistan
Sri Lanka
Ecuador
Bangladesh
Ghana
Guyana
Paraguay
Armenia
Honduras
Cameroon
Guinea
Uganda
Turkey
Indonesia
Mozambique
Cuba
Madagascar
Dominican Republic
Myanmar
Venezuela
Ethiopia
Papua New Guinea
Mali
Burkina Faso
Togo
Tanzania
Niger
Nigeria
Cote d'Ivoire
Lebanon
Serbia & Montenegro
Angola
Sudan
Malawi
Korea, D.P.R.
Zambia
Nicaragua
Sierra Leone
September 2003
Composite
Risk Rating
09/03
65.3
65.3
65.0
64.8
64.5
64.5
63.8
63.5
63.5
63.5
63.3
63.0
63.0
62.5
62.5
62.3
62.3
62.0
62.0
62.0
61.8
61.3
61.3
60.3
60.0
High Risk
59.8
59.8
59.5
59.3
59.3
58.5
58.3
58.3
58.0
57.5
57.0
55.5
55.5
55.3
55.0
54.3
54.0
53.5
52.8
52.3
51.3
Composite
Risk Rating
10/02
61.3
62.8
49.3
66.0
64.0
61.5
64.0
61.0
58.5
63.3
59.8
60.8
60.8
62.0
60.3
60.3
63.8
63.0
62.5
63.0
57.3
58.0
61.0
64.3
58.8
09/03
versus
10/02
4.0
2.5
15.8
-1.3
0.5
3.0
-0.3
2.5
5.0
0.3
3.5
2.3
2.3
0.5
2.3
2.0
-1.5
-1.0
-0.5
-1.0
4.5
3.3
0.3
-4.0
1.3
Rank in
10/02
99
93
132
80
86
98
86
101
115
90
108
104
104
96
106
106
88
91
94
91
120
116
101
85
112
-10.0
-2.5
5.3
0.0
-2.8
-0.3
-0.5
-1.5
0.5
0.0
6.0
-0.8
0.0
4.5
1.8
0.0
0.0
6.8
3.8
-2.5
-1.0
66
95
124
111
96
112
112
108
118
118
130
121
122
131
128
124
126
135
133
123
129
69.8
62.3
54.3
59.3
62.0
58.8
58.8
59.8
57.5
57.5
51.0
56.3
55.5
50.8
53.3
54.3
54.0
46.8
49.0
54.8
52.3
Reproduction without permission of the Publisher is strictly forbidden
S-5
International Country Risk Guide
Rank in
09/03
133
124
125
126
137
128
129
140
S-6
Country
Haiti
Congo, Republic
Guinea-Bissau
Congo, Dem. Republic
Somalia
Iraq
Liberia
Zimbabwe
September 2003
Composite
Composite
Risk Rating
Risk Rating
09/03
10/02
51.0
54.0
Very High Risk
48.8
61.0
47.5
48.3
46.5
41.5
45.5
43.0
42.0
45.5
36.0
45.3
34.3
37.3
09/03
versus
10/02
-3.0
Rank in
10/02
126
-12.3
-0.8
5.0
2.5
-3.5
-9.3
-3.0
101
134
139
138
136
137
140
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
September 2003
TABLE 2A
COMPOSITE RISK RATINGS OVER THE PERIOD OCTOBER 2002 THROUGH
SEPTEMBER 2003
Country
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Rep.
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Rep.
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
10/02 11/02 12/02 01/03 02/03 03/03 04/03 05/03 06/03 07/03 08/03 09/03
66.5 66.5 67.3 67.5 67.3 66.8 66.8 67.0 66.8 67.0 67.0 67.0
61.3 63.8 63.8 63.8 65.8 65.5 65.5 65.0 65.0 65.0 66.3 66.3
53.3 53.5 53.8 55.0 54.8 54.3 54.3 56.8 56.8 55.0 55.0 55.0
49.3 48.8 48.0 50.5 51.0 51.0 56.3 56.3 57.0 64.3 64.3 65.0
60.3 60.0 60.3 60.3 60.3 60.0 60.0 60.0 59.8 59.8 59.8 62.3
83.0 82.5 82.5 82.0 81.8 81.0 80.3 81.5 81.3 81.3 81.3 81.0
86.0 86.5 86.8 86.3 85.8 87.0 87.0 86.0 86.3 85.8 85.8 86.0
67.3 66.5 67.3 67.3 68.5 68.5 68.5 68.5 68.5 68.5 68.8 68.8
76.0 76.0 76.0 76.0 75.8 75.8 75.8 75.8 75.8 75.8 78.8 78.8
80.3 80.8 81.0 80.8 81.0 80.8 80.3 80.0 79.8 79.8 79.8 79.8
60.8 61.5 61.3 61.0 63.3 62.5 62.5 60.5 60.5 60.5 63.0 63.0
61.3 61.3 61.5 63.0 63.0 63.3 63.8 64.8 65.3 65.0 65.3 65.3
84.5 84.8 84.3 84.0 84.0 83.0 83.3 82.8 84.0 85.3 85.3 85.3
65.8 65.8 65.8 67.0 66.8 66.3 65.8 66.0 67.5 67.0 67.0 66.8
79.8 80.0 79.3 79.0 79.3 79.5 79.8 79.5 79.3 79.3 79.0 79.5
59.5 62.0 62.3 62.8 63.0 62.8 63.5 64.0 65.5 65.8 66.0 66.3
88.3 88.3 88.3 87.5 87.5 87.5 87.5 85.8 88.3 88.3 88.3 88.3
71.5 71.3 70.8 70.8 71.8 71.8 71.5 71.5 71.8 71.8 71.8 71.8
58.8 59.0 58.3 57.8 57.8 57.8 58.0 58.0 58.0 58.3 58.3 58.3
63.0 62.5 62.0 61.8 62.5 62.5 62.5 62.3 62.3 62.5 62.5 62.0
84.8 84.8 84.8 84.8 84.8 84.8 85.0 86.0 85.8 86.3 86.3 86.8
76.3 76.3 76.8 76.8 75.8 75.8 74.8 75.5 76.0 77.0 77.0 76.8
74.8 75.0 75.0 75.0 76.3 75.8 76.5 76.5 76.5 77.0 77.3 77.3
61.0 60.5 60.8 60.3 60.3 60.3 60.0 60.3 60.8 61.8 63.0 63.5
41.5 47.5 47.3 50.0 46.3 45.8 45.5 44.3 43.8 46.0 46.3 46.5
61.0 61.0 60.8 60.5 60.5 60.0 60.5 60.5 60.8 61.0 61.0 48.8
74.8 75.0 73.5 73.8 73.5 73.3 72.8 72.5 72.5 72.5 72.5 72.3
56.3 55.3 51.8 53.8 53.3 53.0 55.0 55.5 56.3 56.0 56.0 55.5
72.8 72.5 72.3 72.0 72.0 72.0 72.3 72.8 72.5 72.0 72.0 72.3
64.3 64.0 62.5 62.5 62.5 61.3 61.3 61.0 61.0 61.3 61.3 60.3
80.8 80.5 80.5 82.0 82.0 81.8 82.3 83.3 83.3 83.5 83.5 83.8
76.3 76.3 76.3 77.0 77.0 76.8 78.0 77.5 77.5 78.3 78.0 78.3
87.8 88.0 87.8 87.5 87.5 87.0 87.0 87.0 87.0 87.3 87.0 85.8
69.8 69.0 67.3 68.0 68.3 68.3 68.3 68.3 67.0 67.0 59.8 59.8
59.8 59.8 60.8 61.5 60.5 60.5 60.5 62.0 61.8 63.3 63.3 63.3
66.8 67.0 67.5 68.3 68.5 67.0 66.0 65.5 65.5 66.0 65.8 65.8
71.5 71.8 71.8 69.8 69.8 69.8 70.0 70.0 70.0 69.8 69.8 69.5
75.3 75.3 74.8 74.5 74.3 73.5 73.5 75.0 74.8 75.0 75.0 75.0
59.3 58.3 57.0 58.5 57.8 57.8 57.8 58.8 58.8 58.8 58.8 59.3
89.5 89.0 89.0 88.8 89.0 89.8 88.3 88.8 87.3 88.3 88.8 86.8
82.0 81.5 81.3 80.0 80.5 81.0 80.8 80.0 79.0 79.0 79.0 79.0
66.5 66.5 66.3 66.0 66.0 66.0 65.8 65.8 65.8 66.3 66.3 66.3
66.3 66.3 66.3 66.5 66.3 66.0 66.5 66.8 67.0 66.8 67.3 67.0
83.5 83.5 82.8 81.8 82.8 82.0 82.0 81.8 82.0 82.3 81.8 81.8
60.8 60.3 59.8 60.3 60.3 61.5 62.3 62.0 63.3 63.5 63.8 63.0
74.8 74.8 74.5 74.5 76.0 76.0 76.5 75.5 75.5 75.8 76.0 76.0
67.3 67.3 67.0 67.0 68.3 68.0 68.0 67.5 67.5 67.5 67.0 67.0
62.5 63.0 63.0 64.3 62.5 62.8 62.8 61.8 61.8 61.8 62.0 62.0
Reproduction without permission of the Publisher is strictly forbidden
S-7
International Country Risk Guide
Country
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua N. G.
Paraguay
Peru
Philippines
Poland
S-8
September 2003
10/02 11/02 12/02 01/03 02/03 03/03 04/03 05/03 06/03 07/03 08/03 09/03
48.3 48.0 47.3 47.0 47.0 47.0 47.3 46.8 46.8 47.0 47.0 47.5
62.0 61.5 61.5 61.5 61.5 61.5 61.5 61.5 61.5 61.5 62.5 62.5
54.0 53.8 51.5 51.8 51.3 50.0 51.0 51.3 50.8 51.5 50.5 51.0
63.8 63.8 63.5 63.8 63.8 64.0 62.0 61.8 62.0 62.0 62.0 62.3
84.3 84.3 84.3 84.0 83.5 83.3 83.3 82.8 82.8 81.5 81.5 81.5
77.5 77.3 78.0 77.8 77.8 76.3 76.3 76.3 76.8 77.3 77.3 76.8
79.3 79.5 79.5 79.3 79.3 78.8 79.3 78.5 79.8 80.0 80.3 80.3
65.8 66.0 66.3 66.3 66.8 66.8 67.5 67.8 67.8 67.8 67.8 69.0
58.0 58.0 58.3 59.5 59.5 59.5 59.8 61.3 61.0 61.3 61.0 61.3
63.8 63.5 63.3 63.5 63.8 66.0 66.0 66.0 66.0 65.5 65.5 70.5
45.5 45.0 44.0 44.3 44.3 41.5 30.0 38.5 40.8 41.3 41.3 42.0
89.0 89.0 88.8 87.0 87.0 87.0 87.0 87.3 87.3 87.5 87.5 87.3
65.3 65.5 65.3 65.5 66.0 66.8 68.0 68.0 69.0 71.0 70.8 72.5
80.5 80.5 79.3 79.8 79.5 80.5 80.5 80.0 79.8 80.0 79.8 80.0
68.3 69.8 69.8 69.5 69.8 69.3 68.5 66.5 65.5 66.3 69.3 69.5
85.0 85.3 85.3 85.3 85.8 86.5 86.8 85.5 85.5 85.5 86.0 86.5
70.0 70.5 70.5 70.3 70.3 70.3 69.8 70.8 70.5 70.5 71.0 71.0
72.3 71.8 71.8 72.0 71.8 71.8 71.8 71.8 71.8 71.8 72.3 72.3
58.0 58.3 57.5 60.8 64.0 64.3 65.5 65.0 66.0 66.0 65.8 65.8
46.8 46.0 46.0 55.5 55.5 55.5 55.5 55.5 55.0 55.0 53.5 53.5
80.0 79.8 79.8 80.8 80.3 80.5 80.5 80.5 80.8 80.8 80.8 80.8
81.5 81.3 81.0 81.5 81.8 81.8 82.3 85.8 85.3 85.3 85.3 86.3
75.0 75.0 76.5 76.5 76.5 76.5 76.3 76.3 78.3 78.3 78.3 78.3
55.5 54.3 55.5 54.8 54.5 54.5 54.8 55.5 55.5 55.5 55.5 55.5
45.3 45.3 45.3 45.3 44.8 44.8 43.2 43.2 40.8 33.5 35.8 36.0
69.5 70.0 70.0 75.5 76.3 75.5 75.5 75.5 75.5 75.5 74.8 73.8
74.0 74.0 74.0 75.5 76.0 76.3 76.3 76.3 76.3 76.5 76.5 76.5
91.3 91.3 91.0 90.8 90.8 90.8 90.8 90.8 90.8 91.0 91.0 91.0
58.8 59.0 58.8 61.5 61.5 60.8 60.5 60.3 60.3 60.3 60.0 60.0
54.0 54.0 53.5 53.5 54.3 54.0 54.3 54.5 54.0 54.3 54.3 54.0
76.8 77.5 77.5 77.8 76.3 76.3 76.5 75.8 75.8 75.8 75.8 75.8
58.8 58.8 58.3 58.0 58.0 58.3 58.3 58.3 58.3 58.5 58.5 58.5
79.8 79.8 79.8 79.5 79.5 79.5 79.5 79.5 79.3 79.5 79.5 79.8
69.8 70.8 70.8 70.3 71.0 70.5 71.0 71.5 72.0 71.5 71.8 72.0
64.0 64.0 64.0 64.0 63.8 63.5 64.5 63.8 64.3 64.3 64.3 64.5
64.0 64.0 64.0 64.0 64.0 64.0 64.0 64.0 64.0 64.0 64.0 63.8
72.5 72.8 72.8 72.5 72.5 73.8 74.0 74.5 74.0 74.8 75.0 75.3
61.0 61.3 61.3 61.5 61.5 61.5 61.5 61.5 61.3 61.3 61.3 61.3
62.3 62.3 62.3 62.0 62.0 61.8 61.8 60.5 59.8 59.8 59.8 59.8
76.5 77.8 76.5 76.5 76.8 76.3 76.8 76.8 77.0 77.3 76.5 76.3
85.5 83.8 83.5 83.0 83.0 83.0 83.0 83.3 84.0 85.5 85.5 85.5
79.5 81.0 80.8 80.5 80.3 80.3 80.8 80.8 80.8 80.8 81.8 81.5
54.8 53.5 53.8 53.0 53.0 53.0 52.8 53.0 53.0 52.5 52.5 52.3
57.5 57.8 57.5 57.3 57.3 57.3 57.3 57.3 57.3 57.5 57.5 57.5
51.0 51.0 51.0 51.3 52.5 52.8 52.3 54.3 55.8 56.5 57.0 57.0
91.3 91.3 91.3 90.8 91.0 91.0 91.3 91.5 91.3 91.0 91.0 91.0
79.8 79.8 79.8 80.3 80.3 80.3 80.3 80.0 80.0 79.8 79.8 79.8
58.5 58.0 58.5 59.0 59.0 58.5 60.0 60.5 60.5 63.3 63.0 63.5
71.0 71.3 71.0 71.0 71.3 71.3 71.5 71.5 71.8 71.3 71.3 71.5
62.0 62.3 63.0 63.8 63.8 64.0 62.8 61.0 59.5 59.3 59.3 59.3
60.3 60.3 56.5 57.8 57.3 55.0 54.8 60.0 61.8 62.8 62.5 62.5
68.3 67.3 68.8 69.3 69.0 68.5 68.5 68.8 68.8 68.5 68.3 68.3
71.0 71.0 71.0 70.3 70.5 70.3 70.0 71.5 72.0 70.0 70.3 70.0
76.0 76.0 76.3 76.8 76.8 75.8 75.8 75.3 75.5 75.5 75.5 75.5
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
Country
Portugal
Qatar
Romania
Russian Fed.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Rep.
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tob.
Tunisia
Turkey
Uganda
Ukraine
United Arab Em’tes
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
September 2003
10/02 11/02 12/02 01/03 02/03 03/03 04/03 05/03 06/03 07/03 08/03 09/03
79.3 79.3 78.3 78.0 78.0 77.5 78.8 78.8 78.8 79.0 79.0 78.5
79.3 79.3 79.3 78.8 78.8 78.8 78.8 78.5 78.5 78.5 78.5 78.5
68.3 68.5 69.5 69.8 69.8 69.8 71.3 71.5 72.0 72.0 72.0 70.5
70.8 70.0 70.0 70.3 71.5 71.5 72.5 71.0 71.5 71.8 75.0 75.0
73.0 73.0 72.5 76.3 76.3 76.3 76.5 76.5 77.3 76.8 76.8 76.8
66.0 64.8 65.5 65.0 65.0 65.0 65.0 65.0 65.0 65.3 65.3 64.8
50.8 50.5 50.0 50.0 51.3 51.3 52.3 52.3 55.3 55.5 55.5 55.3
52.3 52.3 52.3 52.3 52.0 52.3 51.8 51.5 51.8 51.8 51.3 51.3
90.0 90.0 90.0 89.8 89.8 89.3 89.3 88.5 88.5 88.3 88.3 88.3
75.8 75.8 75.8 74.8 74.8 74.5 75.0 75.0 74.3 75.0 75.0 75.5
79.8 79.8 80.3 80.0 79.8 79.8 80.0 80.3 79.3 79.5 79.5 79.8
43.0 44.5 44.5 44.5 44.5 44.5 44.5 44.5 44.5 45.5 45.5 45.5
67.5 69.8 68.8 68.3 68.8 68.3 68.5 68.8 69.0 69.3 68.5 68.5
80.8 80.8 80.8 80.8 80.8 80.3 80.3 80.0 81.0 81.0 81.0 80.0
63.3 63.5 63.3 63.3 63.3 64.0 63.8 63.5 64.0 63.8 63.8 63.5
54.3 54.3 54.3 54.3 54.3 54.5 55.3 55.3 55.3 55.0 55.0 54.3
62.8 62.8 61.8 66.8 61.5 61.5 60.3 65.5 65.5 65.5 65.3 65.3
84.0 84.5 84.5 86.8 86.8 86.8 86.5 85.8 85.8 86.5 86.8 86.8
92.0 92.0 91.5 91.5 91.3 91.3 91.3 91.8 91.5 92.0 91.0 91.0
70.3 70.5 69.8 71.5 71.5 71.3 70.8 70.5 70.5 70.5 70.5 70.5
82.5 82.5 82.0 82.0 83.3 83.3 83.3 83.3 83.3 83.3 83.0 83.0
57.5 58.0 58.0 58.3 58.3 57.8 58.0 57.8 57.8 57.8 57.8 58.0
76.3 76.3 76.3 75.0 75.0 73.5 73.3 74.0 74.0 75.5 75.5 75.5
59.8 59.3 59.3 58.5 58.8 57.8 58.8 58.5 58.5 58.8 58.8 58.3
72.5 72.5 73.3 73.3 75.0 75.0 75.0 75.0 75.0 75.0 76.5 76.5
72.0 72.0 72.0 72.3 72.3 72.8 72.8 72.8 72.8 72.5 72.5 72.8
57.3 58.8 59.8 56.8 57.0 56.5 56.3 58.0 59.5 59.3 61.8 61.8
63.0 62.8 62.5 62.5 62.5 62.3 62.8 62.0 62.0 62.0 62.0 62.0
68.0 67.8 67.5 67.5 67.5 68.3 68.5 68.5 68.3 68.3 68.3 68.8
82.0 81.8 81.8 81.5 83.3 83.3 83.3 84.0 84.0 84.0 84.5 84.5
82.5 82.3 82.0 82.0 85.0 83.3 84.5 85.5 85.3 85.0 83.8 83.8
75.5 75.8 77.5 76.3 76.8 73.8 75.5 76.8 77.0 75.8 75.8 76.0
61.5 61.8 61.5 63.3 63.5 60.8 60.5 60.8 62.0 65.0 66.0 64.5
54.3 54.3 53.8 56.8 56.8 57.3 59.3 57.0 58.0 57.5 58.8 59.5
70.3 70.3 70.3 70.3 70.3 70.3 70.8 70.5 70.8 70.5 70.5 69.8
66.0 66.0 66.0 66.0 66.0 66.5 66.5 67.0 67.0 67.0 67.0 67.0
49.0 50.0 48.0 50.8 51.0 49.5 50.3 51.3 52.3 52.5 52.5 52.8
37.3 37.3 37.0 36.8 37.0 37.0 32.8 32.8 34.5 35.5 35.5 34.3
Reproduction without permission of the Publisher is strictly forbidden
S-9
International Country Risk Guide
September 2003
TABLE 2B
CURRENT RISK RATINGS AND COMPOSITE RISK FORECASTS
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, DR
Congo, Rep.
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Rep.
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
S-10
CURRENT RATINGS
Political
Financial Economic
Risk
Risk
Risk
09/03
09/03
09/03
68.5
33.5
32.0
45.5
43.5
43.5
58.5
25.5
26.0
64.0
29.5
36.5
61.0
31.0
32.5
85.5
35.5
41.0
90.0
42.0
40.0
64.0
38.5
35.0
84.0
37.5
36.0
77.0
44.0
38.5
48.0
39.5
38.5
62.0
38.0
30.5
86.5
41.5
42.5
63.5
37.0
33.0
76.5
44.0
38.5
69.0
30.5
33.0
82.0
50.0
44.5
71.0
36.5
36.0
63.5
23.5
29.5
54.0
33.5
36.5
89.5
42.0
42.0
77.0
37.5
39.0
70.5
45.5
38.5
55.0
39.5
32.5
38.5
24.5
30.0
56.5
23.0
18.0
74.0
37.0
33.5
46.5
30.5
34.0
72.5
37.0
35.0
58.5
28.5
33.5
83.0
43.5
41.0
78.5
41.0
37.0
87.5
42.0
42.0
62.5
29.5
27.5
58.0
34.5
34.0
64.0
34.0
33.5
64.0
39.5
35.5
75.0
37.0
38.0
54.0
31.5
33.0
93.5
36.0
44.0
78.0
40.0
40.0
60.5
34.0
38.0
69.5
29.0
35.5
83.0
41.5
39.0
61.5
33.5
31.0
78.0
36.5
37.5
Year
Ago
10/02
66.5
61.3
53.3
49.3
60.3
83.0
86.0
67.3
76.0
80.3
60.8
61.3
84.5
65.8
79.8
59.5
88.3
71.5
58.8
63.0
84.8
76.3
74.8
61.0
41.5
61.0
74.8
56.3
72.8
64.3
80.8
76.3
87.8
69.8
59.8
66.8
71.5
75.3
59.3
89.5
82.0
66.5
66.3
83.5
60.8
74.8
COMPOSITE RATINGS
Current
Forecasts
Rating
One Year
Five Year
09/03
WC
BC
WC
BC
67.0
55.5
70.0
58.0
71.0
66.3
60.5
69.5
59.0
76.5
55.0
44.0
54.0
46.5
63.0
65.0
58.5
67.5
60.5
77.0
62.3
57.5
63.0
55.5
71.5
81.0
77.5
83.0
73.0
87.0
86.0
79.5
88.0
78.5
92.5
68.8
58.0
69.0
54.0
70.5
78.8
75.0
79.5
70.5
81.0
79.8
76.0
81.0
67.0
79.5
63.0
60.5
69.5
54.5
71.0
65.3
52.0
58.0
50.5
62.0
85.3
78.5
85.5
75.5
89.0
66.8
62.5
70.0
63.0
74.5
79.5
73.5
80.0
69.5
82.5
66.3
51.0
63.0
59.0
76.5
88.3
76.5
81.5
74.5
83.0
71.8
67.5
78.0
64.5
80.5
58.3
53.5
62.3
52.5
66.5
62.0
57.5
65.0
54.0
66.0
86.8
77.5
84.0
72.0
87.5
76.8
67.5
76.0
68.5
79.5
77.3
74.5
78.5
67.0
80.5
63.5
57.5
66.5
53.0
69.5
46.5
47.0
56.5
41.5
66.5
48.8
53.0
62.0
49.0
64.5
72.3
73.0
77.5
69.0
80.0
55.5
58.0
67.3
57.0
69.0
72.3
66.5
73.5
64.0
75.0
60.3
50.5
63.0
45.0
71.0
83.8
68.5
76.5
69.5
79.5
78.3
73.0
77.0
72.5
80.5
85.8
83.0
86.5
77.5
90.0
59.8
56.0
63.5
55.5
69.5
63.3
51.0
61.0
52.0
67.0
65.8
60.5
72.5
55.0
70.5
69.5
71.5
76.0
67.5
79.0
75.0
70.5
77.0
66.5
80.0
59.3
51.5
60.5
52.5
67.0
86.8
79.0
89.5
75.5
89.5
79.0
78.0
85.5
75.0
90.0
66.3
61.5
72.0
58.0
75.0
67.0
65.0
72.5
61.0
76.0
81.8
78.0
83.8
75.0
91.0
63.0
59.0
65.5
57.5
67.5
76.0
73.5
80.0
72.5
85.0
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
COUNTRY
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, DPR
Korea, Rep
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
CURRENT RATINGS
Political
Financial Economic
Risk
Risk
Risk
09/03
09/03
09/03
60.5
40.0
33.5
53.5
35.5
35.0
47.5
21.5
26.0
68.0
29.5
27.5
45.0
31.5
25.5
60.5
36.0
28.0
75.5
44.0
43.5
84.5
34.5
34.5
90.0
31.5
39.0
59.0
44.0
35.0
51.5
34.5
36.5
58.0
46.5
36.5
41.5
22.5
20.0
92.0
41.5
41.0
67.5
39.5
38.0
78.0
43.0
39.0
70.5
36.0
32.5
85.5
50.0
37.5
69.5
36.5
36.0
70.5
37.0
37.0
62.5
36.5
32.5
50.5
26.5
30.0
79.0
42.0
40.5
78.0
47.5
47.0
78.5
39.5
38.5
60.0
25.0
26.0
32.5
18.5
21.0
62.0
44.0
41.5
78.5
37.0
37.5
94.5
43.0
44.5
60.0
32.0
28.0
56.5
25.5
26.0
71.5
41.0
39.0
61.5
31.5
24.0
86.5
37.5
35.5
69.0
38.0
37.0
68.5
31.0
29.5
71.0
31.5
25.0
73.5
40.0
37.0
63.0
34.0
25.5
47.5
39.5
32.5
76.0
41.0
35.5
90.5
39.5
41.0
91.0
30.5
41.5
57.5
25.0
22.0
58.5
25.5
31.0
44.0
39.0
31.0
88.5
47.5
46.0
75.5
42.0
42.0
49.0
40.5
37.5
72.0
35.0
36.0
September 2003
Year
Ago
10/02
67.3
62.5
48.3
62.0
54.0
63.8
84.3
77.5
79.3
65.8
58.0
63.8
45.5
89.0
65.3
80.5
68.3
85.0
70.0
72.3
58.0
46.8
80.0
81.5
75.0
55.5
45.3
69.5
74.0
91.3
58.8
54.0
76.8
58.8
79.8
69.8
64.0
64.0
72.5
61.0
62.3
76.5
85.5
79.5
54.8
57.5
51.0
91.3
79.8
58.5
71.0
COMPOSITE RATINGS
Current
Forecasts
Rating
One Year
Five Year
09/03
WC
BC
WC
BC
67.0
65.3
71.5
60.0
75.5
62.0
58.5
64.5
54.0
66.5
47.5
46.5
53.5
50.5
63.5
62.5
59.8
66.0
58.5
69.5
51.0
39.5
52.0
38.5
66.5
62.3
57.5
66.0
56.5
72.0
81.5
71.5
77.5
65.5
81.5
76.8
71.0
79.0
70.0
81.0
80.3
75.0
82.5
73.0
84.0
69.0
59.5
69.0
56.0
73.5
61.3
45.0
59.0
46.5
68.5
70.5
37.5
68.5
39.0
75.0
42.0
39.0
53.3
37.5
72.5
87.3
80.5
89.5
76.0
91.0
72.5
60.0
72.0
58.0
77.5
80.0
73.5
81.0
71.0
84.5
69.5
66.5
73.0
65.0
78.0
86.5
82.0
88.0
78.0
92.0
71.0
69.0
74.0
66.5
77.5
72.3
68.5
73.0
61.5
74.5
65.8
62.5
68.0
54.0
71.5
53.5
25.0
44.0
26.5
61.5
80.8
64.5
83.3
61.5
86.5
86.3
74.5
87.0
67.5
88.0
78.3
73.5
80.0
71.5
86.5
55.5
48.5
57.0
45.0
63.5
36.0
35.0
44.5
35.0
53.0
73.8
71.5
78.3
56.5
78.3
76.5
70.0
76.0
65.5
79.5
91.0
89.0
91.5
83.0
91.5
60.0
63.5
69.5
60.0
71.0
54.0
49.0
57.5
49.0
63.0
75.8
69.0
77.5
64.0
79.0
58.5
58.5
68.5
54.0
71.0
79.8
77.0
81.5
73.5
81.0
72.0
66.0
72.8
60.0
77.0
64.5
48.5
54.0
50.0
67.0
63.8
60.5
67.0
54.0
69.5
75.3
69.0
76.0
62.5
77.5
61.3
54.5
63.5
48.0
65.0
59.8
51.0
57.5
42.5
63.0
76.3
70.5
77.8
68.0
79.5
85.5
82.0
88.0
80.5
88.5
81.5
79.3
83.8
75.5
88.0
52.3
44.5
52.0
43.5
60.0
57.5
57.5
64.5
53.0
67.5
57.0
49.5
65.5
49.0
71.5
91.0
85.5
91.0
79.0
94.0
79.8
70.5
74.0
65.5
74.5
63.5
49.5
60.0
46.5
64.0
71.5
65.0
74.5
59.0
78.5
Reproduction without permission of the Publisher is strictly forbidden
S-11
International Country Risk Guide
COUNTRY
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emir’s
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
S-12
CURRENT RATINGS
Political
Financial Economic
Risk
Risk
Risk
09/03
09/03
09/03
53.5
35.0
30.0
57.0
39.0
29.0
62.5
37.5
36.5
68.0
36.5
35.5
76.5
39.0
35.5
86.0
36.5
34.5
73.0
36.5
47.5
71.0
38.5
31.5
67.5
43.0
39.5
67.0
45.5
41.0
59.0
35.5
35.0
62.0
26.0
22.5
56.0
21.0
25.5
86.5
45.5
44.5
78.5
37.5
35.0
80.0
41.5
38.0
27.0
35.5
28.5
65.5
36.0
35.5
82.0
39.0
39.0
59.0
37.0
31.0
45.0
29.5
34.0
65.0
35.5
30.0
90.5
40.0
43.0
91.0
47.5
43.5
64.5
39.0
37.5
76.0
47.0
43.0
60.5
21.0
34.5
71.5
39.5
40.0
51.0
34.0
31.5
67.0
45.0
41.0
73.0
36.0
36.5
65.5
31.5
26.5
56.5
34.0
33.5
59.5
40.5
37.5
78.0
45.0
46.0
86.0
42.5
39.0
81.0
33.0
38.0
70.5
30.5
28.0
50.0
42.5
26.5
65.5
38.5
35.5
62.5
35.0
36.5
57.5
25.0
23.0
38.0
21.0
9.5
September 2003
Year
Ago
10/02
62.0
60.3
68.3
71.0
76.0
79.3
79.3
68.3
70.8
73.0
66.0
50.8
52.3
90.0
75.8
79.8
43.0
67.5
80.8
63.3
54.3
62.8
84.0
92.0
70.3
82.5
57.5
76.3
59.8
72.5
72.0
57.3
63.0
68.0
82.0
82.5
75.5
61.5
54.3
70.3
66.0
49.0
37.3
COMPOSITE RATINGS
Current
Forecasts
Rating
One Year
Five Year
09/03
WC
BC
WC
BC
59.3
52.5
61.5
51.5
66.0
62.5
56.3
65.0
42.5
70.5
68.3
59.5
71.3
55.0
72.5
70.0
60.5
71.0
61.5
74.5
75.5
70.5
80.0
70.0
80.5
78.5
73.0
80.5
70.0
83.5
78.5
60.0
64.5
57.5
68.5
70.5
64.5
74.0
57.5
78.5
75.0
71.3
78.5
64.5
83.5
76.8
61.0
72.5
60.0
78.0
64.8
60.0
64.0
52.5
66.0
55.3
32.5
60.5
32.5
69.5
51.3
45.0
55.5
37.5
60.0
88.3
81.0
85.0
64.5
85.5
75.5
69.5
78.0
69.5
81.5
79.8
73.0
82.5
70.5
84.0
45.5
33.0
43.5
32.0
55.5
68.5
61.5
71.0
56.5
73.0
80.0
74.5
83.5
74.5
89.0
63.5
50.5
70.0
50.0
74.0
54.3
41.0
59.0
39.0
67.0
65.3
61.0
67.5
57.5
71.5
86.8
81.0
86.0
73.5
88.0
91.0
88.3
92.0
81.5
94.0
70.5
62.0
71.0
57.5
71.0
83.0
77.5
89.5
67.5
86.5
58.0
55.0
62.0
52.5
66.5
75.5
66.0
73.5
58.0
75.5
58.3
54.0
62.0
54.0
68.0
76.5
74.0
78.8
71.5
80.5
72.8
58.5
73.5
55.0
75.5
61.8
57.5
65.5
60.5
73.0
62.0
58.0
64.0
54.0
67.5
68.8
62.5
70.5
58.5
76.5
84.5
79.5
85.5
71.5
86.5
83.8
77.5
85.5
76.5
89.0
76.0
73.0
79.5
72.0
84.0
64.5
57.0
67.5
58.0
73.5
59.5
54.5
65.5
51.5
76.0
69.8
66.0
71.5
62.5
75.0
67.0
62.0
66.0
57.5
71.5
52.8
55.0
58.0
52.0
64.0
34.3
27.5
55.0
34.0
66.0
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
September 2003
TABLE 2C
COMPOSITE RISK FORECASTS
Country
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Current
Rating
67.0
66.3
55.0
65.0
62.3
81.0
86.0
68.8
78.8
79.8
63.0
65.3
85.3
66.8
79.5
66.3
88.3
71.8
58.3
62.0
86.8
76.8
77.3
63.5
46.5
48.8
72.3
55.5
72.3
60.3
83.8
78.3
85.8
59.8
63.3
65.8
69.5
75.0
59.3
86.8
79.0
66.3
67.0
81.8
63.0
76.0
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
55.5
70.0
14.5 58.0
71.0
13.0
60.5
69.5
9.0 59.0
76.5
17.5
44.0
54.0
10.0 46.5
63.0
16.5
58.5
67.5
9.0 60.5
77.0
16.5
57.5
63.0
5.5 55.5
71.5
16.0
77.5
83.0
5.5 73.0
87.0
14.0
79.5
88.0
8.5 78.5
92.5
14.0
58.0
69.0
11.0 54.0
70.5
16.5
75.0
79.5
4.5 70.5
81.0
10.5
76.0
81.0
5.0 67.0
79.5
12.5
60.5
69.5
9.0 54.5
71.0
16.5
52.0
58.0
6.0 50.5
62.0
11.5
78.5
85.5
7.0 75.5
89.0
13.5
62.5
70.0
7.5 63.0
74.5
11.5
73.5
80.0
6.5 69.5
82.5
13.0
51.0
63.0
12.0 59.0
76.5
17.5
76.5
81.5
5.0 74.5
83.0
8.5
67.5
78.0
10.5 64.5
80.5
16.0
53.5
62.3
8.8 52.5
66.5
14.0
57.5
65.0
7.5 54.0
66.0
12.0
77.5
84.0
6.5 72.0
87.5
15.5
67.5
76.0
8.5 68.5
79.5
11.0
74.5
78.5
4.0 67.0
80.5
13.5
57.5
66.5
9.0 53.0
69.5
16.5
47.0
56.5
9.5 41.5
66.5
25.0
53.0
62.0
9.0 49.0
64.5
15.5
73.0
77.5
4.5 69.0
80.0
11.0
58.0
67.3
9.3 57.0
69.0
12.0
66.5
73.5
7.0 64.0
75.0
11.0
50.5
63.0
12.5 45.0
71.0
26.0
68.5
76.5
8.0 69.5
79.5
10.0
73.0
77.0
4.0 72.5
80.5
8.0
83.0
86.5
3.5 77.5
90.0
12.5
56.0
63.5
7.5 55.5
69.5
14.0
51.0
61.0
10.0 52.0
67.0
15.0
60.5
72.5
12.0 55.0
70.5
15.5
71.5
76.0
4.5 67.5
79.0
11.5
70.5
77.0
6.5 66.5
80.0
13.5
51.5
60.5
9.0 52.5
67.0
14.5
79.0
89.5
10.5 75.5
89.5
14.0
78.0
85.5
7.5 75.0
90.0
15.0
61.5
72.0
10.5 58.0
75.0
17.0
65.0
72.5
7.5 61.0
76.0
15.0
78.0
83.8
5.8 75.0
91.0
16.0
59.0
65.5
6.5 57.5
67.5
10.0
73.5
80.0
6.5 72.5
85.0
12.5
Reproduction without permission of the Publisher is strictly forbidden
S-13
International Country Risk Guide
Country
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
S-14
Current
Rating
67.0
62.0
47.5
62.5
51.0
62.3
81.5
76.8
80.3
69.0
61.3
70.5
42.0
87.3
72.5
80.0
69.5
86.5
71.0
72.3
65.8
53.5
80.8
86.3
78.3
55.5
36.0
73.8
76.5
91.0
60.0
54.0
75.8
58.5
79.8
72.0
64.5
63.8
75.3
61.3
59.8
76.3
85.5
81.5
52.3
57.5
57.0
91.0
79.8
63.5
71.5
59.3
September 2003
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
65.3
71.5
6.3 60.0
75.5
15.5
58.5
64.5
6.0 54.0
66.5
12.5
46.5
53.5
7.0 50.5
63.5
13.0
59.8
66.0
6.3 58.5
69.5
11.0
39.5
52.0
12.5 38.5
66.5
28.0
57.5
66.0
8.5 56.5
72.0
15.5
71.5
77.5
6.0 65.5
81.5
16.0
71.0
79.0
8.0 70.0
81.0
11.0
75.0
82.5
7.5 73.0
84.0
11.0
59.5
69.0
9.5 56.0
73.5
17.5
45.0
59.0
14.0 46.5
68.5
22.0
37.5
68.5
31.0 39.0
75.0
36.0
39.0
53.3
14.3 37.5
72.5
35.0
80.5
89.5
9.0 76.0
91.0
15.0
60.0
72.0
12.0 58.0
77.5
19.5
73.5
81.0
7.5 71.0
84.5
13.5
66.5
73.0
6.5 65.0
78.0
13.0
82.0
88.0
6.0 78.0
92.0
14.0
69.0
74.0
5.0 66.5
77.5
11.0
68.5
73.0
4.5 61.5
74.5
13.0
62.5
68.0
5.5 54.0
71.5
17.5
25.0
44.0
19.0 26.5
61.5
35.0
64.5
83.3
18.8 61.5
86.5
25.0
74.5
87.0
12.5 67.5
88.0
20.5
73.5
80.0
6.5 71.5
86.5
15.0
48.5
57.0
8.5 45.0
63.5
18.5
35.0
44.5
9.5 35.0
53.0
18.0
71.5
78.3
6.8 56.5
78.3
21.8
70.0
76.0
6.0 65.5
79.5
14.0
89.0
91.5
2.5 83.0
91.5
8.5
63.5
69.5
6.0 60.0
71.0
11.0
49.0
57.5
8.5 49.0
63.0
14.0
69.0
77.5
8.5 64.0
79.0
15.0
58.5
68.5
10.0 54.0
71.0
17.0
77.0
81.5
4.5 73.5
81.0
7.5
66.0
72.8
6.8 60.0
77.0
17.0
48.5
54.0
5.5 50.0
67.0
17.0
60.5
67.0
6.5 54.0
69.5
15.5
69.0
76.0
7.0 62.5
77.5
15.0
54.5
63.5
9.0 48.0
65.0
17.0
51.0
57.5
6.5 42.5
63.0
20.5
70.5
77.8
7.3 68.0
79.5
11.5
82.0
88.0
6.0 80.5
88.5
8.0
79.3
83.8
4.5 75.5
88.0
12.5
44.5
52.0
7.5 43.5
60.0
16.5
57.5
64.5
7.0 53.0
67.5
14.5
49.5
65.5
16.0 49.0
71.5
22.5
85.5
91.0
5.5 79.0
94.0
15.0
70.5
74.0
3.5 65.5
74.5
9.0
49.5
60.0
10.5 46.5
64.0
17.5
65.0
74.5
9.5 59.0
78.5
19.5
52.5
61.5
9.0 51.5
66.0
14.5
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
Country
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
Current
Rating
62.5
68.3
70.0
75.5
78.5
78.5
70.5
75.0
76.8
64.8
55.3
51.3
88.3
75.5
79.8
45.5
68.5
80.0
63.5
54.3
65.3
86.8
91.0
70.5
83.0
58.0
75.5
58.3
76.5
72.8
61.8
62.0
68.8
84.5
83.8
76.0
64.5
59.5
69.8
67.0
52.8
34.3
September 2003
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
56.3
65.0
8.8 42.5
70.5
28.0
59.5
71.3
11.8 55.0
72.5
17.5
60.5
71.0
10.5 61.5
74.5
13.0
70.5
80.0
9.5 70.0
80.5
10.5
73.0
80.5
7.5 70.0
83.5
13.5
60.0
64.5
4.5 57.5
68.5
11.0
64.5
74.0
9.5 57.5
78.5
21.0
71.3
78.5
7.3 64.5
83.5
19.0
61.0
72.5
11.5 60.0
78.0
18.0
60.0
64.0
4.0 52.5
66.0
13.5
32.5
60.5
28.0 32.5
69.5
37.0
45.0
55.5
10.5 37.5
60.0
22.5
81.0
85.0
4.0 64.5
85.5
21.0
69.5
78.0
8.5 69.5
81.5
12.0
73.0
82.5
9.5 70.5
84.0
13.5
33.0
43.5
10.5 32.0
55.5
23.5
61.5
71.0
9.5 56.5
73.0
16.5
74.5
83.5
9.0 74.5
89.0
14.5
50.5
70.0
19.5 50.0
74.0
24.0
41.0
59.0
18.0 39.0
67.0
28.0
61.0
67.5
6.5 57.5
71.5
14.0
81.0
86.0
5.0 73.5
88.0
14.5
88.3
92.0
3.8 81.5
94.0
12.5
62.0
71.0
9.0 57.5
71.0
13.5
77.5
89.5
12.0 67.5
86.5
19.0
55.0
62.0
7.0 52.5
66.5
14.0
66.0
73.5
7.5 58.0
75.5
17.5
54.0
62.0
8.0 54.0
68.0
14.0
74.0
78.8
4.8 71.5
80.5
9.0
58.5
73.5
15.0 55.0
75.5
20.5
57.5
65.5
8.0 60.5
73.0
12.5
58.0
64.0
6.0 54.0
67.5
13.5
62.5
70.5
8.0 58.5
76.5
18.0
79.5
85.5
6.0 71.5
86.5
15.0
77.5
85.5
8.0 76.5
89.0
12.5
73.0
79.5
6.5 72.0
84.0
12.0
57.0
67.5
10.5 58.0
73.5
15.5
54.5
65.5
11.0 51.5
76.0
24.5
66.0
71.5
5.5 62.5
75.0
12.5
62.0
66.0
4.0 57.5
71.5
14.0
55.0
58.0
3.0 52.0
64.0
12.0
27.5
55.0
27.5 34.0
66.0
32.0
Reproduction without permission of the Publisher is strictly forbidden
S-15
International Country Risk Guide
September 2003
TABLE 3A
POLITICAL RISK RATINGS OVER THE PERIOD OCTOBER 2002 THROUGH
SEPTEMBER 2003
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, P. Rep.
Colombia
Congo, D. Rep
Congo, Rep.
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Rep.
Denmark
Dominican R.
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
S-16
10/02
66.5
46.0
54.0
57.0
59.0
88.0
88.5
58.5
84.5
78.0
51.5
59.0
86.5
64.5
75.5
60.5
80.5
73.5
63.5
55.5
86.0
77.0
66.0
53.5
39.5
55.0
76.0
52.0
73.5
62.5
77.0
79.0
90.5
66.0
55.5
62.5
65.0
75.0
55.0
95.0
81.5
61.0
68.0
87.0
62.5
77.5
63.0
11/02
66.5
46.0
54.0
56.0
58.5
87.0
89.5
57.5
84.5
79.0
51.5
59.0
87.0
64.5
76.0
68.0
80.5
73.0
64.0
55.0
86.0
77.5
66.0
53.0
40.5
55.0
76.5
50.0
73.0
62.0
77.0
79.0
91.0
66.0
55.5
63.0
65.5
75.0
54.5
94.0
81.0
61.0
68.0
87.0
62.5
77.5
63.0
12/02
68.0
46.0
54.5
54.5
59.0
87.0
90.5
59.0
84.5
79.5
51.0
59.0
87.0
64.5
76.0
69.0
80.5
72.5
63.0
55.0
86.0
77.5
66.0
53.0
40.5
55.0
76.0
43.5
73.0
61.5
77.0
79.0
91.0
66.5
57.5
63.0
65.5
74.5
52.0
94.0
81.0
61.0
68.0
86.0
62.5
77.5
63.0
01/03
68.0
46.0
55.5
55.5
59.0
86.5
90.5
59.0
84.5
79.0
50.5
61.0
87.0
63.5
76.0
69.0
80.5
73.0
62.5
55.0
85.5
77.0
66.0
53.0
41.5
55.0
76.0
43.5
73.0
61.5
80.5
79.0
91.0
66.5
59.0
63.0
64.5
74.5
52.5
94.0
79.0
60.5
68.0
84.5
62.5
77.5
63.0
02/03
68.0
46.0
54.5
55.5
59.0
86.5
89.5
61.5
84.0
79.5
51.0
61.0
87.0
63.0
76.0
69.0
80.5
73.5
62.5
55.5
85.5
75.5
68.5
53.5
41.5
55.0
76.0
42.5
73.0
61.5
80.5
79.0
91.0
66.5
57.0
63.5
64.5
74.0
51.0
94.5
80.5
60.5
68.0
84.5
62.0
77.5
63.0
03/03
68.0
45.5
54.0
56.0
58.5
85.0
92.0
61.5
84.0
79.0
49.5
62.0
85.0
62.0
76.0
69.0
80.5
73.5
62.5
55.5
85.5
76.0
68.5
53.5
40.5
55.0
76.0
42.0
73.0
60.0
80.0
79.0
90.0
66.5
57.0
63.5
64.5
72.5
51.0
94.5
81.5
60.5
68.0
83.0
62.0
77.5
62.5
04/03
68.5
45.5
54.0
59.0
58.5
83.0
92.0
61.5
84.0
78.0
49.5
62.0
85.5
61.0
76.0
69.0
80.5
73.0
63.0
55.5
86.0
75.5
70.0
53.5
40.5
56.0
75.0
46.0
73.0
60.0
81.0
79.0
90.0
66.5
57.0
63.5
65.0
72.5
51.0
91.5
81.0
60.0
68.5
83.0
63.0
78.5
62.5
05/03
68.5
44.5
58.5
59.0
58.5
85.5
90.5
63.0
84.0
77.5
47.5
62.0
84.5
61.5
76.0
69.0
80.5
72.5
63.0
55.0
86.0
76.5
69.5
53.5
39.5
56.0
75.0
47.0
74.0
59.5
82.5
78.0
90.0
66.0
57.0
63.0
65.0
75.5
53.0
92.5
81.0
60.0
69.5
82.5
62.5
78.5
61.5
06/03
68.5
44.5
58.5
61.5
58.0
85.5
91.0
63.0
84.0
77.0
47.5
62.0
84.5
64.0
75.0
69.0
82.0
73.0
63.0
55.0
86.0
76.5
69.5
53.5
37.5
56.0
75.0
48.5
74.0
59.5
83.0
78.5
90.0
66.0
56.5
63.0
65.0
75.0
53.0
93.5
79.0
60.0
69.5
83.0
62.5
78.5
61.5
Reproduction without permission of the Publisher is strictly forbidden
07/03
68.5
44.5
58.5
62.5
58.0
86.0
89.5
63.0
84.0
77.0
47.5
62.0
86.5
64.0
75.0
68.5
82.0
72.5
63.0
55.0
88.5
77.5
70.5
53.5
38.5
56.0
74.5
47.5
72.5
59.5
83.0
78.5
90.0
66.0
58.0
64.0
64.5
75.0
53.0
93.0
78.5
60.5
69.5
83.0
62.5
78.5
61.5
08/03
68.5
45.5
58.5
63.0
58.0
86.0
89.5
64.0
84.0
77.0
48.0
62.0
86.5
64.0
75.0
69.0
82.0
71.0
63.5
55.0
88.5
77.5
70.5
55.0
38.5
56.0
74.5
47.5
72.5
59.5
83.0
78.5
89.5
62.5
58.0
64.0
64.5
75.0
53.0
94.0
78.0
60.5
69.5
83.0
62.5
78.0
60.5
09/03
68.5
45.5
58.5
64.0
61.0
85.5
90.0
64.0
84.0
77.0
48.0
62.0
86.5
63.5
76.5
69.0
82.0
71.0
63.5
54.0
89.5
77.0
70.5
55.0
38.5
56.5
74.0
46.5
72.5
58.5
83.0
78.5
87.5
62.5
58.0
64.0
64.0
75.0
54.0
93.5
78.0
60.5
69.5
83.0
61.5
78.0
60.5
International Country Risk Guide
COUNTRY
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Rep.
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua N. G.
Paraguay
Peru
Philippines
10/02
51.0
48.5
67.0
45.5
60.5
78.5
81.0
91.5
56.0
48.0
59.5
34.0
92.5
60.0
81.0
68.5
86.0
67.5
69.0
48.5
57.0
76.5
72.5
74.0
60.0
43.0
62.0
73.5
94.5
57.5
56.0
71.0
61.5
86.5
69.0
68.0
71.5
71.5
63.0
49.5
75.5
92.0
90.5
61.5
58.0
37.5
90.0
75.0
49.0
72.0
57.0
55.0
62.5
67.0
11/02
52.0
48.0
66.0
45.5
60.5
78.5
81.0
92.0
56.5
48.0
59.0
33.0
92.5
60.5
81.0
71.5
87.0
68.5
69.0
49.0
55.5
76.0
72.0
74.0
60.0
43.0
62.0
73.5
94.5
58.0
55.0
72.0
61.5
86.5
70.0
68.0
71.5
71.5
63.0
49.5
75.5
88.5
91.0
59.5
58.5
36.5
90.0
75.0
48.0
72.5
57.0
55.0
61.0
67.0
12/02
52.0
47.0
66.0
45.0
60.0
78.5
82.5
92.0
57.0
48.5
58.5
31.0
92.5
60.5
81.0
71.5
87.0
68.5
69.0
47.5
55.0
76.0
71.5
77.0
60.0
43.0
62.0
73.5
94.5
57.5
55.0
72.0
61.0
86.5
70.0
68.0
71.5
71.5
63.0
49.5
75.5
88.5
91.0
60.0
58.5
37.0
90.0
75.0
49.0
72.0
57.0
53.0
61.0
67.0
01/03
54.5
47.0
66.0
45.0
60.5
78.5
82.5
92.0
57.0
49.0
59.0
31.5
92.0
60.0
81.0
71.0
86.5
68.0
69.5
54.0
54.5
78.0
71.0
77.0
58.5
43.0
63.5
77.0
94.5
63.0
55.0
72.5
61.0
86.5
69.5
68.0
71.5
71.5
63.5
49.5
75.5
88.5
91.0
60.0
58.5
37.0
89.5
76.0
49.0
72.0
57.0
53.0
61.5
67.0
September 2003
02/03
53.5
47.0
66.0
45.0
60.5
77.5
82.5
92.0
58.0
49.0
59.5
31.5
92.0
61.5
80.5
71.0
86.5
68.0
69.5
59.0
54.5
77.5
71.0
77.0
58.0
42.0
63.5
78.0
94.5
63.0
55.0
72.5
61.0
86.5
69.5
67.5
71.5
71.5
63.5
49.5
75.0
88.5
91.0
60.0
58.5
37.0
89.5
76.0
49.0
72.5
57.0
53.0
61.5
67.5
03/03
54.0
47.0
66.0
45.0
61.0
77.0
82.5
91.5
58.0
49.0
58.5
26.0
92.0
63.0
79.0
71.0
86.5
68.0
69.5
59.5
54.5
77.5
69.5
77.0
58.0
42.0
63.0
78.5
94.5
61.5
55.0
72.5
61.5
86.5
69.0
67.5
71.5
72.5
63.5
49.0
75.0
88.5
91.0
60.0
58.5
37.0
89.5
76.0
48.0
72.5
57.0
53.0
63.5
67.5
04/03
54.0
47.5
66.0
45.0
60.5
77.0
82.5
91.5
58.0
49.0
58.5
17.5
92.0
63.0
79.0
70.0
87.0
67.0
69.5
62.0
54.5
77.5
70.5
76.5
58.5
38.9
63.0
78.5
94.5
61.5
55.0
73.0
61.5
86.5
69.0
69.0
71.5
72.5
63.5
49.0
76.0
88.5
91.0
59.0
58.5
37.0
89.0
76.0
48.0
72.0
56.0
52.5
63.5
67.5
05/03
53.0
46.5
66.0
45.0
60.0
77.0
82.5
90.0
58.5
50.5
58.5
34.5
92.5
63.0
78.0
70.0
85.0
69.0
69.5
61.0
54.5
77.5
77.5
76.5
60.0
38.9
63.0
78.5
94.5
60.5
55.0
72.5
61.5
86.5
69.5
68.0
71.5
73.5
63.5
49.0
76.0
89.0
91.0
58.0
58.5
41.0
89.0
75.5
49.0
72.0
53.0
57.5
63.5
67.5
06/03
53.0
46.5
66.0
45.0
60.5
77.0
84.5
90.0
58.5
50.0
58.5
39.0
92.5
65.0
78.5
70.0
85.0
68.5
69.5
63.0
53.5
79.0
77.5
78.5
60.0
34.0
63.0
78.5
94.5
60.5
55.0
72.5
61.5
86.5
69.5
68.0
71.5
73.0
63.0
47.5
76.0
90.5
91.0
58.0
58.5
44.0
88.5
75.5
49.0
72.5
53.0
57.5
63.5
68.0
Reproduction without permission of the Publisher is strictly forbidden
07/03
53.0
46.5
66.0
45.0
60.5
75.5
84.5
90.0
58.5
51.5
58.0
38.0
92.5
68.0
78.5
70.0
85.0
68.5
69.5
63.0
53.5
79.0
77.5
78.5
60.0
25.0
63.0
78.5
94.5
60.5
55.0
72.5
61.5
86.5
69.0
68.0
71.5
74.0
63.0
47.5
76.0
90.5
91.0
57.5
58.5
44.5
88.5
75.5
48.5
72.5
53.0
57.5
63.0
68.0
08/03
53.5
46.5
68.0
45.0
60.5
75.5
84.5
90.0
58.5
51.0
58.0
38.0
92.5
67.5
78.0
70.5
84.5
69.5
70.5
62.5
50.5
79.0
77.5
78.5
60.0
29.5
62.0
78.5
94.5
60.5
55.0
71.5
61.5
86.5
69.0
68.0
71.5
73.5
63.0
47.5
76.0
90.5
91.0
57.5
58.5
44.0
88.5
75.5
48.0
72.5
53.0
57.0
62.5
68.0
09/03
53.5
47.5
68.0
45.0
60.5
75.5
84.5
90.0
59.0
51.5
58.0
41.5
92.0
67.5
78.0
70.5
85.5
69.5
70.5
62.5
50.5
79.0
78.0
78.5
60.0
32.5
62.0
78.5
94.5
60.0
56.5
71.5
61.5
86.5
69.0
68.5
71.0
73.5
63.0
47.5
76.0
90.5
91.0
57.5
58.5
44.0
88.5
75.5
49.0
72.0
53.5
57.0
62.5
68.0
S-17
International Country Risk Guide
COUNTRY
Poland
Portugal
Qatar
Romania
Russian Fed.
Saudi Arabia
Senegal
Serbia &
Montenegro
Sierra Leone
Singapore
Slovak Rep.
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & T.
Tunisia
Turkey
Uganda
Ukraine
United Arab E.
United K’dom
United States
Uruguay
Venezuela
Vietnam
Yemen, Rep.
Zambia
Zimbabwe
S-18
September 2003
10/02
79.0
87.5
74.5
69.0
64.0
68.0
61.0
11/02
79.0
87.5
74.5
69.0
62.5
68.0
58.5
12/02
79.5
87.5
74.5
71.0
62.5
67.0
60.5
01/03
79.0
87.5
73.5
71.0
62.5
67.0
60.0
02/03
79.0
87.5
73.5
71.0
62.5
67.0
60.0
03/03
77.0
86.5
73.5
71.0
62.5
67.0
60.0
04/03
77.0
86.0
73.5
70.5
64.5
66.5
60.0
05/03
76.0
86.0
73.0
71.0
64.5
66.5
60.0
06/03
76.5
86.0
73.0
71.5
65.5
68.0
60.0
07/03
76.5
86.0
73.0
71.5
66.0
67.0
60.0
08/03
76.5
86.0
73.0
71.5
67.5
67.0
60.0
09/03
76.5
86.0
73.0
71.0
67.5
67.0
59.0
52.5
55.5
88.5
79.5
80.0
22.0
61.5
82.5
61.0
44.5
65.0
90.5
93.0
65.0
77.0
60.0
72.5
53.5
66.0
71.5
54.0
57.0
59.5
77.0
87.5
75.5
71.5
48.5
67.5
60.5
54.5
33.5
52.0
55.5
88.5
79.5
80.0
25.0
63.5
82.5
61.0
44.5
65.0
91.5
93.0
65.5
77.0
60.5
72.5
52.5
66.0
71.5
58.5
57.0
59.0
77.0
87.5
76.5
71.0
48.0
67.5
60.5
55.5
33.5
51.0
56.0
88.5
79.5
81.0
25.0
64.0
83.0
60.5
44.5
65.0
91.5
92.5
65.5
76.0
60.5
72.5
53.0
66.0
71.5
60.0
57.0
58.5
77.0
87.0
80.0
71.0
46.5
67.5
60.5
54.0
34.0
52.0
56.0
88.0
79.0
81.0
25.0
63.0
83.5
60.5
44.5
65.0
91.5
93.0
65.5
76.0
60.5
72.5
52.0
66.0
72.0
59.0
57.0
58.5
76.5
87.5
79.5
71.0
44.5
67.5
60.5
54.0
33.5
54.5
55.5
88.0
79.0
81.0
25.0
63.0
83.5
60.5
44.5
65.5
91.5
92.5
65.5
76.0
60.5
72.5
52.5
66.0
72.0
59.0
57.0
58.5
76.5
86.5
79.0
72.0
45.5
67.5
60.5
54.5
34.0
54.5
55.5
87.0
79.0
81.0
25.0
63.0
82.5
61.0
45.0
65.5
91.5
92.5
65.5
76.0
60.5
69.5
52.5
66.0
72.0
57.5
56.5
60.0
76.5
83.0
77.5
72.0
45.5
67.5
61.5
54.0
34.0
56.5
55.5
87.0
79.0
81.5
25.0
63.5
82.5
60.5
45.5
65.5
91.0
92.5
65.0
76.0
60.5
69.0
52.5
66.0
72.0
57.0
57.0
60.0
76.5
85.0
78.5
70.5
49.5
67.5
61.5
56.5
36.0
56.5
56.0
86.5
79.0
81.5
25.0
63.5
82.0
60.0
45.5
65.5
90.0
92.5
65.0
76.0
60.0
69.5
52.0
66.0
71.5
60.0
56.0
60.0
78.0
87.5
81.0
70.5
51.5
67.0
62.5
56.5
36.0
62.5
56.0
86.5
79.0
80.0
25.0
64.0
83.5
60.0
45.5
65.5
90.0
92.5
65.0
76.0
60.5
69.5
52.0
66.0
72.0
60.5
56.5
60.0
78.0
87.0
81.5
71.0
51.0
67.0
62.5
57.5
37.0
62.5
56.0
86.5
78.5
80.0
27.0
64.0
83.5
59.5
45.0
65.5
91.0
92.5
65.0
76.0
60.5
71.5
52.0
66.0
72.0
60.5
56.5
60.0
78.0
86.5
81.0
71.0
49.5
66.5
62.5
57.5
39.0
62.5
56.0
86.5
78.5
80.0
27.0
64.0
83.5
59.5
45.0
65.0
91.0
91.0
64.5
76.0
60.5
71.5
52.0
67.0
72.0
65.5
56.5
60.0
78.0
86.0
81.0
71.0
49.5
66.5
62.5
57.5
39.0
62.0
56.0
86.5
78.5
80.0
27.0
65.5
82.0
59.0
45.0
65.0
90.5
91.0
64.5
76.0
60.5
71.5
51.0
67.0
73.0
65.5
56.5
59.5
78.0
86.0
81.0
70.5
50.0
65.5
62.5
57.5
38.0
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
September 2003
TABLE 3B
POLITICAL RISK POINTS BY COMPONENT – SEPTEMBER 2003
This table lists the total points for each of the following political risk components out of the
maximum points indicated. The symbol > indicates a rise in the points awarded to that specific
risk component from the previous month (an improving risk), while the symbo < indicates a
decrease (deteriorating risk). The final columns in the table show the overall political risk
rating (the sum of the points awarded to each component) and the change from the preceding
month.
A
B
C
D
Government Stability
Socioeconomic
Conditions
Investment Profile
Internal Conflict
12
12
12
12
E
F
G
H
I
D
External Conflict
Corruption
Military in Politics
Religious Tensions
Law and Order
COUNTRY
A
B
C
E
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, P. Rep.
Colombia
Congo, D. Rep.
Congo, Rep.
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Rep.
9.5
8.5
10.0
>9.0
>9.0
10.0
>9.0
8.5
11.0
11.0
10.5
10.0
9.5
<5.0
10.0
9.0
11.5
7.0
8.5
9.5
>9.5
7.5
11.0
9.0
8.0
11.0
6.5
8.0
7.0
9.5
10.0
7.0
4.0
4.0
2.0
2.5
5.0
9.5
10.0
7.5
7.0
8.0
2.5
2.5
9.5
5.0
5.5
5.5
10.5
4.0
3.5
3.0
8.5
7.5
7.0
4.0
1.0
2.5
6.5
2.0
5.5
5.5
10.5
7.5
8.0 11.0
11.0
8.0
4.5
11.0
8.5
9.5
10.5
>5.5
9.5
10.0
8.0 >9.5
7.5
10.0
9.5 <10.5
12.0 11.5
11.5
9.0
9.5
7.5
11.5 10.5
12.0
11.5
9.5
11.0
6.0
7.0
8.0
5.5 10.0
10.5
11.5 11.5
11.5
9.5 10.0
11.0
11.5 10.5
11.0
7.5 10.5
11.0
11.5 12.0
11.0
11.5 11.0
10.0
9.0 10.5
9.0
6.5
8.5 <10.0
12.0 12.0
11.0
11.0 <10.5
11.0
7.5 11.5
11.0
9.0
3.5
8.5
6.0
7.0
8.5
8.0 >10.0
10.0
8.5 <10.5
11.0
6.0 <8.5
9.5
9.0 10.5
9.5
<3.5
9.0
9.5
12.0 10.0
10.0
12.0 10.5
11.0
F
2.0
1.5
2.0
2.5
1.5
4.5
5.0
2.0
4.0
2.0
1.0
2.0
4.0
2.0
3.0
4.0
2.5
2.0
2.0
2.0
5.0
2.5
2.0
3.0
1.0
2.0
2.5
3.0
3.0
2.5
4.0
2.5
G
5.0
0.0
2.0
4.0
3.5
6.0
6.0
4.0
6.0
3.0
2.5
5.0
6.0
3.0
6.0
4.0
5.0
5.0
3.0
4.0
6.0
4.0
3.0
2.0
0.0
0.0
6.0
1.0
5.0
3.0
5.0
6.0
12
6
6
6
6
H
5.0
0.0
4.0
6.0
5.0
6.0
6.0
5.0
6.0
4.5
2.5
4.5
5.0
6.0
5.0
6.0
4.0
5.0
5.0
4.0
6.0
6.0
5.0
5.0
4.0
3.0
5.0
2.0
5.0
4.0
4.0
6.0
J
K
L
Ethnic Tensions
Democratic
Accountability
Bureaucracy Quality
I
J
K
2.0
2.0
3.0
1.5
3.0
6.0
6.0
4.0
4.0
5.0
1.0
4.0
5.0
3.0
3.5
1.5
6.0
4.0
3.5
2.0
6.0
5.0
4.5
1.0
1.0
2.0
4.0
2.5
5.0
4.0
5.0
5.0
5.0
2.0
3.0
6.0
5.5
3.5
4.0
4.0
5.0
5.0
2.5
5.0
3.0
3.0
>4.5
3.0
5.0
4.5
4.0
1.5
3.5
5.0
5.0
5.0
1.0
4.0
6.0
2.0
5.0
6.0
2.5
3.0
4.0
2.0
3.0
4.5
>2.5
6.0
5.0
2.0
4.0
4.5
2.5
2.0
6.0
4.0
>4.0
5.0
0.0
5.0
4.5
2.0
6.0
4.0
1.0
3.0
1.0
3.0
5.5
2.0
5.0
0.0
6.0
5.0
Reproduction without permission of the Publisher is strictly forbidden
L
2.0
2.0
1.0
3.0
1.0
4.0
4.0
1.0
3.0
2.0
2.0
1.0
4.0
2.0
2.0
2.0
3.0
2.0
1.0
1.0
4.0
3.0
2.0
2.0
0.0
1.0
2.0
0.0
3.0
2.0
4.0
3.0
6
6
4
Political
Risk Rating
68.5
0.0
45.5
0.0
58.5
0.0
64.0
1.0
61.0
3.0
85.5 -0.5
90.0
0.5
64.0
0.0
84.0
0.0
77.0
0.0
48.0
0.0
62.0
0.0
86.5
0.0
63.5 -0.5
76.5
1.5
69.0
0.0
82.0
0.0
71.0
0.0
63.5
0.0
54.0 -1.0
89.5
1.0
77.0 -0.5
70.5
0.0
55.0
0.0
38.5
0.0
56.5
0.5
74.0 -0.5
46.5 -1.0
72.5
0.0
58.5 -1.0
83.0
0.0
78.5
0.0
S-19
International Country Risk Guide
A
B
C
D
Government Stability
Socioeconomic
Conditions
Investment Profile
Internal Conflict
COUNTRY
Denmark
Dominican R.
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Rep.
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
S-20
A
9.5
7.5
6.5
10.0
7.5
8.5
7.0
<9.5
10.5
9.0
10.0
8.5
10.0
9.0
7.0
9.0
6.5
9.0
10.0
8.5
8.5
10.0
9.0
8.5
9.0
7.0
>9.5
<10.5
10.0
8.5
8.5
10.5
10.0
11.0
9.5
8.5
8.0
>10.5
10.0
8.5
6.0
10.0
9.5
11.0
9.0
>7.0
12
12
12
12
E
F
G
H
I
D
September 2003
External Conflict
Corruption
Military in Politics
Religious Tensions
Law and Order
B
C
E
9.5
4.5
4.5
5.5
4.5
7.0
2.0
9.5
8.0
4.5
4.5
7.5
<5.0
7.5
5.0
4.5
3.5
5.0
0.5
1.5
7.0
7.5
9.5
3.5
3.5
5.5
0.5
11.0
7.0
8.5
5.5
>8.0
4.5
6.5
2.0
1.5
9.5
11.0
6.0
6.0
0.0
4.5
7.0
11.0
4.0
2.5
11.5 <10.0 <9.5
8.5
9.5
10.5
6.0
8.0
11.0
6.5 10.0
10.5
6.0
9.5 <10.5
10.0 11.5
11.0
7.0 >9.0
8.5
12.0 11.0
11.5
12.0 10.5
9.0
7.5
9.5
11.0
8.5 10.0
11.0
12.0 11.0
9.5
7.0 <8.5
11.5
11.0 11.0
10.5
11.0
8.5
9.5
6.5
8.5
9.0
7.0
6.5
8.0
7.0
9.5
10.0
5.0
5.0
8.0
8.0 10.5
10.0
11.5 10.5
11.0
12.0 11.5
11.5
11.0 11.5
11.0
>8.5
8.0
9.0
6.0 >7.5
11.0
6.0
8.5
8.5
8.0
5.5
7.0
12.0 11.5
11.0
9.0
7.5
8.0
12.0 11.0
11.0
9.5
9.0
11.5
11.5 11.5
9.5
9.5
9.0
10.0
7.5 11.0
11.0
9.5
9.0
10.5
5.5 10.0
6.0
9.5 10.0
8.0
11.0 10.5
11.0
11.0 11.5
11.5
9.0
8.0
7.0
0.0 >6.5
7.0
9.0 11.5
10.0
11.0 11.5
10.5
12.0 12.0
11.5
8.0 <6.0
12.0
8.0
7.0
11.0
F
5.5
2.0
3.0
1.5
2.5
3.0
2.0
6.0
3.0
1.0
3.0
4.5
2.5
2.5
1.5
3.0
2.0
3.0
1.0
2.5
4.0
3.0
4.5
1.5
1.0
2.0
4.0
3.5
4.0
2.5
1.5
3.5
3.0
1.5
3.5
1.0
3.0
2.0
2.0
1.0
>2.0
2.0
2.5
5.0
4.0
2.0
G
6.0
3.0
1.5
3.0
3.0
5.0
1.0
6.0
5.0
2.0
2.0
6.0
2.5
4.5
2.0
1.5
1.0
6.0
1.5
3.0
3.0
6.0
6.0
4.0
2.5
5.0
0.0
6.0
2.5
6.0
6.0
6.0
5.0
5.0
4.0
1.0
5.0
5.0
5.0
2.0
1.0
3.0
5.0
6.0
1.0
4.0
12
6
6
6
6
J
K
L
Ethnic Tensions
Democratic
Accountability
Bureaucracy Quality
H
I
J
K
6.0
5.0
5.0
3.0
6.0
5.0
5.0
6.0
4.0
5.0
5.0
6.0
6.0
5.0
6.0
3.0
5.0
6.0
6.0
4.0
5.0
5.0
5.5
1.0
1.0
2.0
2.5
5.0
2.5
4.0
6.0
5.5
3.0
5.0
3.0
6.0
6.0
2.0
5.0
2.5
>4.0
4.0
5.5
6.0
5.0
2.5
6.0
2.0
3.0
4.0
2.5
4.0
5.0
6.0
4.5
3.0
4.0
5.0
2.0
3.0
1.5
2.5
1.0
2.5
2.0
1.5
4.5
4.0
6.0
4.0
2.0
4.0
1.5
6.0
5.0
3.0
1.0
5.0
4.0
4.0
2.0
5.0
5.0
5.0
5.0
4.0
2.0
4.0
4.0
6.0
2.5
3.0
4.0
4.0
3.5
6.0
6.0
2.5
2.5
6.0
3.5
3.0
5.0
4.0
1.5
5.0
3.0
2.0
3.0
2.0
4.0
5.0
5.0
4.0
6.0
2.0
2.0
4.5
2.5
5.5
2.0
5.0
5.0
5.5
5.0
5.0
2.5
6.0
6.0
5.0
4.0
5.0
3.0
2.0
4.0
5.0
2.5
3.5
6.0
5.0
4.0
2.0
4.0
5.0
4.0
6.0
5.0
3.0
4.5
5.0
3.0
6.0
3.5
2.0
>3.0
5.0
2.0
4.0
2.5
6.0
6.0
6.0
4.0
3.0
0.5
6.0
6.0
4.0
4.0
5.0
4.5
1.0
5.0
0.0
6.0
3.0
5.0
5.0
1.0
1.0
5.5
5.0
5.0
4.0
Reproduction without permission of the Publisher is strictly forbidden
L
4.0
1.0
2.0
2.0
2.0
2.5
1.0
4.0
3.0
2.0
2.0
4.0
2.0
3.0
2.0
2.0
1.0
3.0
0.0
2.0
3.0
4.0
4.0
3.0
2.0
2.0
0.0
4.0
4.0
2.5
3.0
4.0
2.0
2.0
2.0
0.0
3.0
2.0
2.5
2.0
0.0
1.0
2.5
4.0
1.0
2.0
6
6
4
Political
Risk Rating
87.5 -2.0
62.5
0.0
58.0
0.0
64.0
0.0
64.0 -0.5
75.0
0.0
54.0
1.0
93.5 -0.5
78.0
0.0
60.5
0.0
69.5
0.0
83.0
0.0
61.5 -1.0
78.0
0.0
60.5
0.0
53.5
0.0
47.5
1.0
68.0
0.0
45.0
0.0
60.5
0.0
75.5
0.0
84.5
0.0
90.0
0.0
59.0
0.5
51.5
0.5
58.0
0.0
41.5
3.5
92.0 -0.5
67.5
0.0
78.0
0.0
70.5
0.0
85.5
1.0
69.5
0.0
70.5
0.0
62.5
0.0
50.5
0.0
79.0
0.0
78.0
0.5
78.5
0.0
60.0
0.0
32.5
3.0
62.0
0.0
78.5
0.0
94.5
0.0
60.0 -0.5
56.5
1.5
International Country Risk Guide
A
B
C
D
Government Stability
Socioeconomic
Conditions
Investment Profile
Internal Conflict
12
12
12
12
E
F
G
H
I
D
September 2003
External Conflict
Corruption
Military in Politics
Religious Tensions
Law and Order
COUNTRY
A
B
C
E
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua N. G.
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Fed.
Saudi Arabia
Senegal
Serbia &
Montenegro
Sierra Leone
Singapore
Slovak Rep.
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
10.0
8.5
10.5
6.5
11.0
11.0
10.5
9.5
9.0
10.0
8.5
9.0
5.0
9.0
8.5
7.5
11.0
9.5
6.5
>7.5
7.5
5.0
9.0
7.5
>8.0
11.5
9.5
11.5
9.5
<9.0
8.0
4.5
8.5
8.0
4.0
2.5
4.5
3.0
4.0
6.0
10.5
10.0
3.5
3.0
1.5
10.0
9.0
6.5
6.5
1.5
3.5
6.0
5.0
5.0
8.5
8.5
4.0
6.5
6.0
4.5
8.5 10.5
11.0
7.5 10.5
10.0
11.5 11.0
12.0
11.5
8.5
11.0
6.5 >9.0
10.5
8.0 11.0 <11.5
9.0
9.5
11.0
8.5
9.5
12.0
3.5
8.0
8.5
10.0
9.5
10.5
12.0 11.0
12.0
11.5 11.5
11.5
6.0
9.0
9.5
7.5 11.0
11.0
4.5
7.0
10.0
11.5 11.5
11.5
11.5
9.5
10.0
4.0 >7.5
8.0
10.0 <10.0
11.0
8.0
9.0
9.5
8.5
8.0
11.0
8.0
6.5
10.5
10.0
9.0
11.0
11.0
9.5
11.5
12.0 11.0 <11.0
10.0
9.5
8.5
8.5 10.5 <11.0
9.0
8.5
9.5
11.0
8.5
10.0
8.0
8.0
11.0
8.0
11.0
11.0
8.0
10.5
5.0
>9.0
>10.0
8.0
10.0
9.5
<8.0
10.0
10.5
7.0
2.5
2.0
9.0
6.0
7.0
1.0
4.0
8.5
4.5
2.0
5.0
10.0
10.5
5.5
8.0
8.0
6.5
12.0
12.0
10.0
2.5
10.5
12.0
8.0
6.0
5.5
12.0
11.5
6.5
11.5
<9.0
11.0
9.5
10.0
11.0
11.5
11.0
11.5
11.5
11.5
4.5
4.0
9.0
10.5
9.5 <10.5
8.0
12.0
7.5
9.5
10.0
10.0
11.0
11.5
12.0
11.5
11.5
8.5
11.0
8.5
F
G
12
6
6
6
6
H
J
K
L
Ethnic Tensions
Democratic
Accountability
Bureaucracy Quality
I
J
K
L
2.5
3.0
3.0
2.0
1.5
2.0
3.0
1.5
1.0
1.5
5.0
5.5
2.5
1.0
1.0
5.0
2.5
1.5
2.0
1.0
1.0
2.5
2.0
2.0
3.5
2.0
2.5
1.5
2.0
2.5
5.0
3.5
6.0
3.0
4.0
5.0
4.0
2.0
0.0
6.0
6.0
6.0
2.0
3.0
2.0
6.0
5.0
0.0
5.0
3.0
1.5
5.0
4.0
6.0
6.0
4.0
5.0
4.5
5.0
2.0
4.0
4.0
4.0
5.0
6.0
5.0
5.0
6.0
6.0
6.0
5.0
6.0
4.0
2.0
2.0
5.0
4.0
1.0
5.0
5.0
6.0
6.0
3.0
5.0
6.0
4.0
5.0
5.5
3.0
3.0
3.0
3.0
5.0
2.0
5.0
4.0
5.0
3.0
3.0
6.0
6.0
6.0
4.0
2.0
1.5
6.0
5.0
3.0
3.0
2.0
2.0
3.0
2.0
4.0
5.0
5.0
4.0
4.0
5.0
3.0
4.0
4.0
6.0
2.5
4.0
5.0
5.0
4.0
3.0
4.5
4.5
4.0
5.0
3.0
2.0
4.5
5.0
5.0
5.0
2.0
5.0
3.0
5.0
6.0
6.0
6.0
4.0
2.0
5.0
3.0
2.0
3.0
6.0
6.0
5.0
4.0
5.0
3.0
0.5
4.0
6.0
6.0
6.0
5.0
3.0
6.0
1.0
1.0
6.0
3.0
2.0
5.0
5.0
6.0
6.0
2.0
6.0
4.0
0.0
4.0
3.0
0.0
3.0
3.0
2.0
2.0
2.0
1.0
1.0
2.0
4.0
4.0
1.0
1.0
1.0
4.0
2.0
2.0
2.0
2.0
1.0
2.0
3.0
3.0
3.0
2.0
1.0
1.0
2.0
1.0
2.0
2.5
4.5
2.5
3.0
1.0
<2.0
3.5
3.0
1.0
2.0
5.5
4.5
2.0
3.0
4.0
2.5
6.0
6.0
5.0
1.0
4.5
5.0
2.0
0.0
3.0
5.5
6.0
2.0
4.0
5.0
4.0
4.5
5.0
5.0
3.0
5.0
5.5
2.0
1.0
6.0
6.0
6.0
5.0
6.0
3.5
3.0
5.0
4.0
4.5
2.0
>2.5
4.5
3.0
2.5
3.0
6.0
5.0
5.0
4.0
3.0
2.0
6.0
3.5
4.0
2.0
3.0
4.0
1.5
1.0
4.0
5.0
4.0
6.0
5.0
4.0
3.0
2.0
6.0
5.0
1.0
3.5
<5.0
5.0
3.5
5.0
6.0
6.0
1.0
5.0
2.0
0.0
4.0
3.0
3.0
0.0
2.0
4.0
2.0
1.0
2.0
4.0
4.0
1.0
3.0
Reproduction without permission of the Publisher is strictly forbidden
6
6
4
Political
Risk Rating
71.5
0.0
61.5
0.0
86.5
0.0
69.0
0.0
68.5
0.5
71.0 -0.5
73.5
0.0
63.0
0.0
47.5
0.0
76.0
0.0
90.5
0.0
91.0
0.0
57.5
0.0
58.5
0.0
44.0
0.0
88.5
0.0
75.5
0.0
49.0
1.0
72.0 -0.5
53.5
0.5
57.0
0.0
62.5
0.0
68.0
0.0
76.5
0.0
86.0
0.0
73.0
0.0
71.0 -0.5
67.5
0.0
67.0
0.0
59.0 -1.0
62.0
56.0
86.5
78.5
80.0
27.0
65.5
82.0
59.0
45.0
65.0
90.5
91.0
64.5
76.0
S-21
-0.5
0.0
0.0
0.0
0.0
0.0
1.5
-1.5
-0.5
0.0
0.0
-0.5
0.0
0.0
0.0
International Country Risk Guide
A
B
C
D
Government Stability
Socioeconomic
Conditions
Investment Profile
Internal Conflict
12
12
12
12
E
F
G
H
I
COUNTRY
A
B
C
Tanzania
Thailand
Togo
Trinidad & T.
Tunisia
Turkey
Uganda
Ukraine
United Arab E.
United K’dom
United States
Uruguay
Venezuela
Vietnam
Yemen, Rep.
Zambia
Zimbabwe
10.0
10.0
<7.5
8.5
11.0
9.5
9.0
7.5
10.5
9.0
10.5
7.0
>8.0
10.5
10.5
7.0
8.0
3.0
8.5
3.0
6.5
5.5
5.5
4.0
5.0
10.0
10.0
7.5
4.5
3.0
5.5
5.0
2.5
1.0
7.5
8.5
8.5
9.5
7.5
8.5
11.5
6.5
>9.0 10.5
7.5
9.5
8.5
7.0
6.0
9.5
11.5 11.0
12.0 10.0
11.5 10.5
<8.5 10.0
4.0
7.5
<7.0 >10.5
8.0
9.0
6.0
8.0
<1.5
6.0
S-22
D
September 2003
External Conflict
Corruption
Military in Politics
Religious Tensions
Law and Order
E
9.5
11.0
10.0
12.0
11.5
8.5
10.0
<9.5
11.0
8.5
8.0
12.0
9.5
11.5
10.0
9.0
8.0
F
2.0
1.5
1.5
2.0
2.0
2.5
2.0
1.0
2.0
4.5
4.0
3.0
1.5
1.5
2.0
2.0
0.0
G
4.0
4.0
1.0
5.0
4.0
4.0
2.0
5.0
5.0
6.0
5.0
5.0
0.5
2.0
4.0
5.0
3.0
12
6
6
6
6
J
K
L
Ethnic Tensions
Democratic
Accountability
Bureaucracy Quality
H
I
J
2.0
5.0
5.0
5.0
5.5
5.0
2.5
5.0
4.0
6.0
4.5
5.0
5.0
<5.0
4.0
4.0
4.0
5.0
2.5
3.0
2.5
5.0
4.5
4.0
4.0
4.0
6.0
5.0
2.5
1.0
4.0
2.0
4.0
0.5
4.0
5.0
2.0
0.5
5.0
2.0
3.0
4.0
4.0
4.0
5.0
6.0
5.0
5.0
3.0
5.0
3.0
Reproduction without permission of the Publisher is strictly forbidden
K
4.0
4.0
2.0
4.0
2.0
5.0
2.5
2.0
2.0
6.0
5.5
5.0
4.0
1.0
4.0
4.0
1.0
L
1.0
2.0
0.0
3.0
2.0
2.0
2.0
1.0
3.0
4.0
4.0
2.0
1.0
2.0
1.0
1.0
2.0
6
6
4
Political
Risk Rating
60.5
0.0
71.5
0.0
51.0 -1.0
67.0
0.0
73.0
1.0
65.5
0.0
56.5
0.0
59.5 -0.5
78.0
0.0
86.0
0.0
81.0
0.0
70.5 -0.5
50.0
0.5
65.5 -1.0
62.5
0.0
57.5
0.0
38.0 -1.0
International Country Risk Guide
September 2003
TABLE 3Ba
POLITICAL RISK SUBCOMPONENTS – SEPTEMBER 2003
The table presents the subcomponents that make up the first five Political Risk Components in
Table 3B. Each subcomponent has a maximum risk point score of 4 and a minimum of 0, with 4
Risk Points indicating Very Low risk and 0 Risk Points indicating Very High Risk. The sum of the
subcomponents within each Political Risk component is the Risk Point Score of that component
as entered in Table 3B.
The subcomponents are:
Government Stability
Col. Subcomponent
1-Government Unity
2-Legislative Strength
3-Popular Support
Socioeconomic Conditions
Col. Subcomponent
1-Unemployment
2-Consumer Confidence
3-Poverty
Government
Stability
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, P. Rep.
Colombia
Congo, D. Rep.
Congo, Rep.
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Rep.
Denmark
Dominican R.
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
1
3.5
3.0
3.5
3.5
3.5
4.0
3.5
3.5
4.0
4.0
4.0
4.0
3.5
2.0
3.5
3.0
4.0
2.5
3.5
3.5
3.0
2.5
4.0
4.0
2.5
4.0
3.0
3.0
2.5
4.0
3.5
2.5
3.5
2.5
2.5
4.0
3.0
3.0
2.5
2
3.5
3.5
4.0
2.5
3.5
3.0
3.0
3.0
4.0
4.0
4.0
3.5
3.0
2.0
4.0
3.0
4.0
3.0
3.0
4.0
4.0
2.5
4.0
2.0
3.0
4.0
1.5
2.5
2.5
4.0
3.0
2.0
3.0
3.0
2.0
4.0
2.5
3.0
2.5
3
2.5
2.0
2.5
3.0
2.0
3.0
2.5
2.0
3.0
3.0
2.5
2.5
3.0
1.0
2.5
3.0
3.5
1.5
2.0
2.0
2.5
2.5
3.0
3.0
2.5
3.0
2.0
2.5
2.0
1.5
3.5
2.5
3.0
2.0
2.0
2.0
2.0
2.5
2.0
A
9.5
8.5
10.0
9.0
9.0
10.0
9.0
8.5
11.0
11.0
10.5
10.0
9.5
5.0
10.0
9.0
11.5
7.0
8.5
9.5
9.5
7.5
11.0
9.0
8.0
11.0
6.5
8.0
7.0
9.5
10.0
7.0
9.5
7.5
6.5
10.0
7.5
8.5
7.0
Investment Profile
Col. Subcomponent
1-Contract Viability
2-Profits Repatriation
3-Payments Delays
Socioeconomic
Conditions
1
1.5
0.0
1.0
1.0
2.0
2.5
3.5
4.0
3.0
2.5
0.0
1.0
2.5
2.0
0.5
2.5
3.0
1.0
1.5
0.5
2.5
2.5
3.0
1.0
0.0
0.0
2.5
0.0
1.5
3.5
4.0
2.5
2.5
1.0
2.0
2.5
2.5
2.0
1.5
2
2.0
2.5
1.0
1.0
2.0
3.0
2.5
2.5
2.0
3.0
2.5
1.5
3.0
2.5
3.0
1.5
3.5
2.0
2.0
2.5
2.0
2.5
3.0
2.0
1.0
2.0
2.0
1.0
2.0
1.0
3.0
2.5
3.0
2.0
1.5
2.5
1.0
2.5
0.5
3
0.5
1.5
0.0
0.5
1.0
4.0
4.0
1.0
2.0
2.5
0.0
0.0
4.0
0.5
2.0
1.5
4.0
1.0
0.0
0.0
4.0
2.5
1.0
1.0
0.0
0.5
2.0
1.0
2.0
1.0
3.5
2.5
4.0
1.5
1.0
0.5
1.0
2.5
0.0
B
4.0
4.0
2.0
2.5
5.0
9.5
10.0
7.5
7.0
8.0
2.5
2.5
9.5
5.0
5.5
5.5
10.5
4.0
3.5
3.0
8.5
7.5
7.0
4.0
1.0
2.5
6.5
2.0
5.5
5.5
10.5
7.5
9.5
4.5
4.5
5.5
4.5
7.0
2.0
Internal Conflict
Col. Subcomponent
1-Civil War
2-Terrorism
3-Civil Disorder
Investment
Profile
1
3.0
2.5
3.0
3.0
2.5
3.5
4.0
3.5
4.0
4.0
2.0
2.0
3.5
4.0
4.0
3.5
4.0
3.5
3.0
2.5
4.0
3.5
3.0
3.0
2.0
2.5
3.0
2.0
3.0
2.0
4.0
4.0
3.5
3.0
2.5
2.5
1.5
3.0
2.5
2
3.0
3.0
3.0
1.5
3.0
3.0
4.0
2.5
4.0
4.0
2.0
2.0
4.0
3.0
3.5
2.0
4.0
4.0
3.5
2.0
4.0
4.0
2.0
3.5
2.0
3.0
2.5
2.5
3.5
0.5
4.0
4.0
4.0
3.0
2.0
2.0
2.0
4.0
3.0
3
2.0
2.5
2.5
1.0
2.5
3.5
4.0
3.0
3.5
3.5
2.0
1.5
4.0
2.5
4.0
2.0
3.5
4.0
2.5
2.0
4.0
3.5
2.5
2.5
2.0
2.5
3.0
1.5
2.5
1.0
4.0
4.0
4.0
2.5
1.5
2.0
2.5
3.0
1.5
External Conflict
Col. Subcomponent
1-War
2-Cross-border Conflict
3-Foreign Pressures
Internal
Conflict
C
8.0
8.0
8.5
5.5
8.0
10.0
12.0
9.0
11.5
11.5
6.0
5.5
11.5
9.5
11.5
7.5
11.5
11.5
9.0
6.5
12.0
11.0
7.5
9.0
6.0
8.0
8.5
6.0
9.0
3.5
12.0
12.0
11.5
8.5
6.0
6.5
6.0
10.0
7.0
1
4.0
2.0
3.5
4.0
4.0
4.0
4.0
3.5
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
3.5
4.0
4.0
4.0
1.0
3.0
3.5
4.0
2.5
4.0
4.0
2.5
4.0
4.0
4.0
4.0
4.0
4.0
4.0
3.5
2
3.5
0.0
3.0
3.5
3.5
2.5
4.0
3.5
3.5
2.5
1.5
3.5
4.0
3.0
4.0
3.5
4.0
3.5
3.5
3.0
4.0
3.5
4.0
0.5
2.0
3.5
4.0
3.0
3.5
3.0
4.0
3.0
3.0
3.0
2.0
2.5
3.5
4.0
3.0
Reproduction without permission of the Publisher is strictly forbidden
3
3.5
2.5
3.0
2.0
2.0
3.0
3.5
2.5
3.0
3.0
1.5
2.5
3.5
3.0
2.5
3.0
4.0
3.5
3.0
2.0
4.0
3.0
3.5
2.0
2.0
3.0
2.5
3.0
3.0
2.0
3.5
3.5
3.0
2.5
2.0
3.5
2.0
3.5
2.5
External
Conflict
D
11.0
4.5
9.5
9.5
9.5
9.5
11.5
9.5
10.5
9.5
7.0
10.0
11.5
10.0
10.5
10.5
12.0
11.0
10.5
8.5
12.0
10.5
11.5
3.5
7.0
10.0
10.5
8.5
10.5
9.0
10.0
10.5
10.0
9.5
8.0
10.0
9.5
11.5
9.0
1
4.0
4.0
3.5
4.0
2.5
4.0
4.0
2.5
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
3.5
3.5
4.0
4.0
4.0
4.0
4.0
3.5
4.0
4.0
4.0
4.0
4.0
4.0
4.0
3.5
4.0
4.0
4.0
4.0
4.0
3.0
2
3.5
3.5
3.5
3.5
2.5
3.0
4.0
2.5
4.0
3.5
2.0
4.0
4.0
3.5
4.0
4.0
3.5
3.5
3.0
3.0
3.5
3.5
3.5
2.5
3.0
3.0
3.5
3.0
2.5
3.5
3.5
3.5
2.5
3.0
3.5
3.5
3.5
4.0
2.5
3
3.5
3.5
3.5
2.5
2.5
3.5
3.5
2.5
4.0
3.5
2.0
2.5
3.5
3.5
3.0
3.0
3.5
3.0
2.5
3.0
3.5
3.5
3.5
2.0
2.0
3.0
3.5
2.5
3.0
2.0
2.5
3.5
3.5
3.5
3.5
3.0
3.0
3.0
3.0
S-23
E
11.0
11.0
10.5
10.0
7.5
10.5
11.5
7.5
12.0
11.0
8.0
10.5
11.5
11.0
11.0
11.0
11.0
10.0
9.0
10.0
11.0
11.0
11.0
8.5
8.5
10.0
11.0
9.5
9.5
9.5
10.0
11.0
9.5
10.5
11.0
10.5
10.5
11.0
8.5
International Country Risk Guide
Government Stability
Col. Subcomponent
1-Government Unity
2-Legislative Strength
3-Popular Support
Socioeconomic Conditions
Col. Subcomponent
1-Unemployment
2-Consumer Confidence
3-Poverty
Government
Stability
COUNTRY
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Rep.
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
S-24
1
3.5
4.0
3.5
4.0
3.0
3.5
3.5
3.0
3.0
3.0
3.5
4.0
4.0
3.0
3.5
3.5
3.0
3.0
2.0
3.5
4.0
3.5
2.5
3.5
3.5
4.0
4.0
3.0
3.0
3.0
3.5
3.5
3.0
2.5
4.0
3.5
4.0
3.5
2.5
3.0
3.0
4.0
3.0
4.0
3.5
4.0
4.0
3.5
3.5
3.5
3.5
1.5
3.5
3.5
3.0
4.0
2
3.0
3.0
3.5
4.0
3.0
3.5
3.5
3.0
4.0
2.0
3.0
4.0
3.0
3.5
3.0
2.5
3.0
3.0
3.0
3.5
3.5
3.0
3.0
3.0
4.0
3.5
4.0
3.5
4.0
2.0
3.5
3.5
3.0
1.0
3.5
3.0
4.0
3.0
2.5
4.0
3.5
3.0
2.0
4.0
4.0
3.5
3.0
4.0
3.5
2.5
2.5
1.5
3.0
3.0
2.5
4.0
3
3.0
3.5
2.0
2.0
2.5
3.0
2.0
1.0
2.0
1.5
2.5
2.0
1.5
2.0
3.5
3.0
2.5
3.0
2.0
2.5
3.0
3.5
3.0
2.0
3.0
2.5
3.0
3.0
1.5
3.0
3.5
3.0
2.5
2.5
2.5
3.0
3.0
2.5
2.0
3.0
2.0
3.5
1.5
3.0
3.5
3.0
2.5
1.5
3.0
2.5
3.0
2.0
2.5
2.0
2.0
3.0
A
9.5
10.5
9.0
10.0
8.5
10.0
9.0
7.0
9.0
6.5
9.0
10.0
8.5
8.5
10.0
9.0
8.5
9.0
7.0
9.5
10.5
10.0
8.5
8.5
10.5
10.0
11.0
9.5
8.5
8.0
10.5
10.0
8.5
6.0
10.0
9.5
11.0
9.0
7.0
10.0
8.5
10.5
6.5
11.0
11.0
10.5
9.5
9.0
10.0
8.5
9.0
5.0
9.0
8.5
7.5
11.0
September 2003
Investment Profile
Col. Subcomponent
1-Contract Viability
2-Profits Repatriation
3-Payments Delays
Socioeconomic
Conditions
1
2.5
2.5
0.5
2.0
2.0
2.0
2.0
2.5
2.0
1.5
2.0
0.0
0.0
2.5
2.5
3.5
0.5
1.5
1.0
0.0
3.5
2.0
2.5
1.5
3.0
2.0
4.0
0.0
1.0
3.5
4.0
2.5
2.0
0.0
0.0
2.5
4.0
2.0
1.5
3.5
2.0
3.0
4.0
2.0
0.5
1.0
1.0
1.0
2.0
3.5
3.5
2.0
1.0
0.0
3.5
4.0
2
3.0
2.0
2.0
2.5
2.0
3.0
2.5
1.5
2.0
2.0
2.5
0.5
1.0
1.5
2.5
2.0
3.0
1.5
2.0
0.5
3.5
2.0
2.0
2.5
2.0
2.0
2.0
2.0
0.5
3.0
3.5
2.0
2.0
0.0
2.0
2.5
3.0
2.0
1.0
2.0
2.5
3.5
2.0
2.0
1.0
2.5
2.0
1.5
2.0
3.0
2.5
1.5
2.0
1.5
2.5
2.5
3
4.0
3.5
2.0
0.0
3.5
0.0
3.0
1.0
0.5
0.0
0.5
0.0
0.5
3.0
2.5
4.0
0.0
0.5
2.5
0.0
4.0
3.0
4.0
1.5
3.0
0.5
0.5
0.0
0.0
3.0
3.5
1.5
2.0
0.0
2.5
2.0
4.0
0.0
0.0
2.5
0.0
2.0
2.0
0.0
1.0
1.0
0.0
1.5
2.0
4.0
4.0
0.0
0.0
0.0
4.0
2.5
B
9.5
8.0
4.5
4.5
7.5
5.0
7.5
5.0
4.5
3.5
5.0
0.5
1.5
7.0
7.5
9.5
3.5
3.5
5.5
0.5
11.0
7.0
8.5
5.5
8.0
4.5
6.5
2.0
1.5
9.5
11.0
6.0
6.0
0.0
4.5
7.0
11.0
4.0
2.5
8.0
4.5
8.5
8.0
4.0
2.5
4.5
3.0
4.0
6.0
10.5
10.0
3.5
3.0
1.5
10.0
9.0
Internal Conflict
Col. Subcomponent
1-Civil War
2-Terrorism
3-Civil Disorder
Investment
Profile
1
4.0
4.0
3.0
3.0
4.0
3.5
3.5
3.5
3.0
2.0
2.5
2.0
3.0
3.5
4.0
4.0
3.5
3.0
2.0
3.0
4.0
2.5
4.0
3.5
4.0
3.0
2.5
3.5
2.0
3.5
3.0
4.0
2.5
0.0
2.5
4.0
4.0
3.0
3.0
3.0
2.5
4.0
4.0
2.5
3.0
3.5
3.0
1.5
3.5
4.0
4.0
3.0
2.5
3.0
3.5
4.0
2
4.0
4.0
2.0
3.0
4.0
1.5
4.0
4.0
2.0
3.0
2.5
1.5
2.5
4.0
4.0
4.0
3.0
1.5
2.0
3.0
4.0
3.5
4.0
3.0
4.0
3.5
2.5
3.0
2.5
3.0
4.0
4.0
3.5
0.0
3.5
3.5
4.0
3.0
3.0
2.5
2.5
4.0
4.0
2.5
3.0
3.0
3.5
1.5
3.5
4.0
3.5
1.5
2.5
1.0
4.0
3.5
3
4.0
4.0
2.5
2.5
4.0
2.0
3.5
3.5
1.5
2.0
2.0
1.5
2.5
4.0
4.0
3.0
2.0
1.5
2.0
2.0
4.0
3.0
4.0
3.0
3.5
3.0
2.5
3.0
1.0
3.0
4.0
3.0
3.0
0.0
3.0
3.5
4.0
2.0
2.0
3.0
2.5
3.5
3.5
1.5
2.0
2.5
2.0
0.5
3.0
4.0
4.0
1.5
2.5
0.5
4.0
4.0
External Conflict
Col. Subcomponent
1-War
2-Cross-border Conflict
3-Foreign Pressures
Internal
Conflict
C
12.0
12.0
7.5
8.5
12.0
7.0
11.0
11.0
6.5
7.0
7.0
5.0
8.0
11.5
12.0
11.0
8.5
6.0
6.0
8.0
12.0
9.0
12.0
9.5
11.5
9.5
7.5
9.5
5.5
9.5
11.0
11.0
9.0
0.0
9.0
11.0
12.0
8.0
8.0
8.5
7.5
11.5
11.5
6.5
8.0
9.0
8.5
3.5
10.0
12.0
11.5
6.0
7.5
4.5
11.5
11.5
1
4.0
4.0
4.0
4.0
4.0
3.0
4.0
4.0
3.5
3.0
4.0
3.5
4.0
4.0
4.0
4.0
4.0
3.0
3.5
2.5
4.0
3.0
4.0
4.0
4.0
4.0
4.0
4.0
2.5
4.0
4.0
4.0
3.0
2.0
4.0
4.0
4.0
3.0
4.0
4.0
4.0
4.0
4.0
3.0
4.0
3.5
4.0
2.5
4.0
4.0
4.0
4.0
4.0
3.0
4.0
4.0
2
3.0
3.5
3.5
2.5
4.0
3.0
3.5
3.5
3.5
2.0
3.0
1.0
3.5
4.0
4.0
4.0
1.5
2.0
3.0
2.0
3.5
2.0
3.5
3.0
4.0
2.5
3.5
2.0
4.0
4.0
2.5
4.0
2.5
2.0
3.5
4.0
4.0
1.5
2.0
3.5
4.0
4.0
3.0
3.5
4.0
3.0
3.0
2.5
3.0
3.5
4.0
3.0
3.5
2.5
4.0
2.5
Reproduction without permission of the Publisher is strictly forbidden
3
4.0
3.0
2.0
3.5
3.0
2.5
3.5
1.0
1.5
1.5
2.5
1.0
3.0
2.5
3.5
3.5
2.5
2.5
2.0
1.0
4.0
2.5
3.5
2.0
3.5
2.5
3.5
3.0
3.5
2.0
4.0
3.5
2.5
2.5
4.0
3.5
4.0
1.5
1.0
3.0
2.5
3.0
1.5
2.5
3.0
3.0
2.5
3.0
2.5
3.5
3.5
2.0
3.5
1.5
3.5
3.0
External
Conflict
D
11.0
10.5
9.5
10.0
11.0
8.5
11.0
8.5
8.5
6.5
9.5
5.0
10.5
10.5
11.5
11.5
8.0
7.5
8.5
5.5
11.5
7.5
11.0
9.0
11.5
9.0
11.0
9.0
10.0
10.0
10.5
11.5
8.0
6.5
11.5
11.5
12.0
6.0
7.0
10.5
10.5
11.0
8.5
9.0
11.0
9.5
9.5
8.0
9.5
11.0
11.5
9.0
11.0
7.0
11.5
9.5
1
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
3.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
3.5
4.0
3.5
4.0
4.0
3.5
4.0
4.0
4.0
3.5
4.0
4.0
3.0
3.5
4.0
4.0
3.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
3.5
4.0
4.0
4.0
4.0
4.0
4.0
4.0
2
4.0
2.5
3.5
3.5
3.5
3.5
3.5
2.5
2.5
2.0
3.0
3.0
3.0
4.0
4.0
3.5
3.0
4.0
3.0
3.0
3.5
2.5
3.5
4.0
2.5
3.0
4.0
3.5
2.0
2.0
4.0
4.0
2.0
2.5
3.5
3.5
4.0
4.0
4.0
3.5
3.0
4.0
4.0
3.5
3.5
3.5
4.0
3.0
3.0
4.0
4.0
2.5
3.0
2.5
4.0
3.0
3
3.5
2.5
3.5
3.5
2.0
4.0
3.0
3.0
3.5
2.0
3.0
1.0
3.0
3.0
3.5
3.5
2.5
3.0
2.0
0.0
3.5
2.0
3.5
3.5
3.0
3.5
3.0
3.0
1.0
2.5
3.0
3.5
2.0
0.5
2.5
3.0
3.5
4.0
3.0
3.5
3.0
4.0
3.0
3.0
4.0
3.5
4.0
1.5
4.0
4.0
3.5
3.0
4.0
3.5
3.5
3.0
E
11.5
9.0
11.0
11.0
9.5
11.5
10.5
9.5
9.0
8.0
10.0
8.0
10.0
11.0
11.5
11.0
9.0
11.0
8.5
7.0
11.0
8.0
11.0
11.5
9.5
10.0
11.0
10.5
6.0
8.0
11.0
11.5
7.0
7.0
10.0
10.5
11.5
12.0
11.0
11.0
10.0
12.0
11.0
10.5
11.5
11.0
12.0
8.5
10.5
12.0
11.5
9.5
11.0
10.0
11.5
10.0
International Country Risk Guide
Government Stability
Col. Subcomponent
1-Government Unity
2-Legislative Strength
3-Popular Support
Socioeconomic Conditions
Col. Subcomponent
1-Unemployment
2-Consumer Confidence
3-Poverty
Government
Stability
COUNTRY
Pakistan
Panama
Papua N. G.
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Fed.
Saudi Arabia
Senegal
Serbia &
Montenegro
Sierra Leone
Singapore
Slovak Rep.
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & T.
Tunisia
Turkey
Uganda
Ukraine
United Arab E.
United K’dom
United States
Uruguay
Venezuela
Vietnam
Yemen, Rep.
Zambia
Zimbabwe
September 2003
Investment Profile
Col. Subcomponent
1-Contract Viability
2-Profits Repatriation
3-Payments Delays
Socioeconomic
Conditions
Internal Conflict
Col. Subcomponent
1-Civil War
2-Terrorism
3-Civil Disorder
Investment
Profile
External Conflict
Col. Subcomponent
1-War
2-Cross-border Conflict
3-Foreign Pressures
Internal
Conflict
External
Conflict
1
3.5
2.5
3.0
3.0
1.5
3.0
2.5
3.5
4.0
3.0
4.0
3.5
3.0
2
3.5
2.5
2.5
2.0
2.0
3.0
2.0
2.5
4.0
3.5
4.0
4.0
4.0
3
A
1
2.5 9.5 2.5
1.5 6.5 2.0
2.0 7.5 0.0
2.5 7.5 1.0
1.5 5.0 2.5
3.0 9.0 2.0
3.0 7.5 1.0
2.0 8.0 2.5
3.5 11.5 2.5
3.0 9.5 2.0
3.5 11.5 2.0
2.0 9.5 0.0
2.0 9.0 2.0
2
2.0
2.5
0.0
2.0
2.5
2.5
1.5
2.5
2.5
1.5
3.0
3.0
2.5
3
2.0
2.0
1.5
0.5
1.0
0.5
2.5
3.5
3.5
0.5
1.5
3.0
0.0
B
6.5
6.5
1.5
3.5
6.0
5.0
5.0
8.5
8.5
4.0
6.5
6.0
4.5
1
2.5
3.5
3.0
3.0
3.5
3.5
4.0
4.0
3.5
3.5
2.5
3.5
2.5
2
0.5
3.5
2.5
3.5
2.5
3.0
3.0
4.0
3.5
2.5
3.0
3.5
3.0
3
1.0
3.0
2.5
2.0
2.0
3.5
4.0
4.0
3.0
2.5
3.5
4.0
2.5
C
4.0
10.0
8.0
8.5
8.0
10.0
11.0
12.0
10.0
8.5
9.0
11.0
8.0
1
3.0
4.0
3.5
3.5
3.5
3.5
4.0
4.0
4.0
4.0
3.0
4.0
3.0
2
2.0
3.5
3.0
2.5
2.0
2.5
3.0
4.0
2.5
3.0
1.5
2.0
2.0
3
D
2.5 7.5
2.5 10.0
2.5 9.0
2.0 8.0
1.0 6.5
3.0 9.0
2.5 9.5
3.0 11.0
3.0 9.5
3.5 10.5
4.0 8.5
2.5 8.5
3.0 8.0
1
3.5
4.0
4.0
4.0
4.0
4.0
4.0
4.0
3.0
4.0
4.0
4.0
4.0
2
2.5
3.5
3.0
4.0
3.0
3.5
4.0
3.5
3.0
3.5
2.5
4.0
3.0
3
2.0
3.5
2.5
3.0
3.5
3.5
3.5
3.5
2.5
3.5
3.0
2.0
4.0
E
8.0
11.0
9.5
11.0
10.5
11.0
11.5
11.0
8.5
11.0
9.5
10.0
11.0
3.0
4.0
4.0
2.5
3.5
2.0
3.0
4.0
2.5
3.5
3.5
3.0
3.0
3.5
2.5
4.0
3.5
3.0
3.0
4.0
3.5
3.0
3.0
3.5
3.0
4.0
2.5
3.5
4.0
4.0
2.5
2.5
3.0
4.0
4.0
2.5
4.0
1.0
4.0
3.0
3.0
3.5
4.0
2.5
4.0
4.0
2.5
4.0
3.5
3.0
3.0
4.0
3.0
4.0
2.5
4.0
3.5
3.5
3.5
2.5
4.0
4.0
2.5
4.0
2.0
3.0
3.0
3.0
3.0
2.0
2.0
3.0
2.5
3.0
2.0
2.5
3.0
3.0
2.0
2.0
3.0
1.5
2.5
3.0
3.0
2.0
2.0
3.0
2.5
3.0
1.0
2.0
2.5
2.5
2.0
1.5
2.0
2.0
2.5
2.5
2.5
1.0
2.0
3.0
2.0
2.0
2.5
2.5
2.5
2.5
2.0
2.5
3.0
2.5
2.5
2.5
1.0
3.0
1.5
2.5
3.0
1.5
1.0
1.0
3.0
2.5
2.5
1.0
0.5
0.0
3.0
2.5
2.0
0.0
2.0
3.5
0.5
0.0
1.0
4.0
4.0
2.0
3.0
0.0
1.5
0.0
2.0
1.5
2.0
0.0
0.5
3.5
3.5
3.5
2.5
1.0
2.0
1.5
0.0
0.0
2.5
2.0
9.0
6.0
7.0
1.0
4.0
8.5
4.5
2.0
5.0
10.0
10.5
5.5
8.0
3.0
8.5
3.0
6.5
5.5
5.5
4.0
5.0
10.0
10.0
7.5
4.5
3.0
5.5
5.0
2.5
1.0
3.0
2.0
4.0
4.0
3.5
0.5
3.5
4.0
3.5
2.5
2.0
4.0
3.5
2.0
3.5
2.5
3.0
2.5
3.5
3.0
3.0
3.0
3.0
3.5
4.0
4.0
3.5
2.0
2.5
2.5
3.0
1.0
3.0
3.0
4.0
4.0
3.5
1.0
3.5
4.0
2.0
2.0
1.5
4.0
4.0
2.5
4.0
3.0
2.5
3.0
4.0
3.0
2.5
3.5
1.5
4.0
4.0
3.5
2.5
1.0
2.0
3.5
1.5
0.0
2.0
1.5
4.0
4.0
3.0
1.0
3.5
4.0
2.5
1.5
2.0
4.0
4.0
2.0
4.0
2.0
3.0
2.0
4.0
3.0
2.0
2.0
1.5
4.0
4.0
4.0
2.5
1.0
2.5
2.0
1.5
0.5
8.0
6.5
12.0
12.0
10.0
2.5
10.5
12.0
8.0
6.0
5.5
12.0
11.5
6.5
11.5
7.5
8.5
7.5
11.5
9.0
7.5
8.5
6.0
11.5
12.0
11.5
8.5
4.0
7.0
8.0
6.0
1.5
3.5
3.5
4.0
4.0
4.0
1.5
4.0
4.0
2.5
2.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
3.5
4.0
4.0
4.0
4.0
4.0
3.0
4.0
4.0
4.0
2.5
3.0
3.0
4.0
3.5
4.0
0.0
2.5
2.0
3.0
2.5
3.0
4.0
4.0
4.0
4.0
2.0
2.5
3.0
2.0
3.0
3.0
1.5
3.0
3.5
2.5
2.5
4.0
2.5
3.5
2.0
3.0
2.5
2.5
3.0
3.0
3.5
3.5
3.0
2.5
3.5
2.5
3.0
3.0
3.0
4.0
3.5
3.0
2.5
3.0
1.5
0.5
3.5
2.5
2.0
2.5
3.5
3.5
4.0
2.0
2.0
3.0
3.0
1.0
1.0
4.0
3.5
4.0
4.0
4.0
3.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
4.0
3.5
4.0
4.0
4.0
4.0
4.0
3.5
3.5
4.0
4.0
3.0
3.5
4.0
4.0
4.0
4.0
3.5
4.0
4.0
3.5
4.0
4.0
4.0
1.0
3.5
3.0
4.0
3.0
3.0
4.0
4.0
2.5
3.0
3.5
3.5
3.0
4.0
4.0
2.5
3.0
3.5
4.0
2.5
2.0
4.0
3.0
4.0
3.5
2.5
3.0
3.0
3.0
3.5
3.5
3.5
0.0
3.0
3.5
4.0
2.5
3.0
3.5
3.5
2.0
2.0
2.0
3.5
3.0
4.0
3.5
2.5
3.5
2.0
3.0
3.0
2.5
4.0
2.5
3.5
2.5
3.0
1.0
11.0
10.0
11.5
11.5
11.5
4.0
10.5
10.5
12.0
9.5
10.0
11.5
11.5
8.5
8.5
9.5
11.0
10.0
12.0
11.5
8.5
10.0
9.5
11.0
8.5
8.0
12.0
9.5
11.5
10.0
9.0
8.0
8.0
11.0
11.0
8.0
10.5
5.0
9.0
10.0
8.0
10.0
9.5
8.0
10.0
10.5
7.0
10.0
10.0
7.5
8.5
11.0
9.5
9.0
7.5
10.5
9.0
10.5
7.0
8.0
10.5
10.5
7.0
8.0
0.0
0.0
3.5
1.0
2.5
0.0
0.0
2.0
2.0
0.0
1.5
3.5
4.0
1.0
3.0
0.5
4.0
0.5
2.0
1.5
2.5
1.0
3.0
4.0
3.5
2.5
1.0
1.0
0.5
1.0
0.0
0.0
Reproduction without permission of the Publisher is strictly forbidden
9.0
9.5
11.0
11.0
11.5
4.5
9.0
9.5
8.0
7.5
10.0
11.0
12.0
11.5
11.0
8.5
9.5
8.5
6.5
10.5
9.5
7.0
9.5
11.0
10.0
10.5
10.0
7.5
10.5
9.0
8.0
6.0
S-25
International Country Risk Guide
September 2003
TABLE 3C
POLITICAL RISK FORECASTS
Country
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
S-26
Current
Rating
68.5
45.5
58.5
64.0
61.0
85.5
90.0
64.0
84.0
77.0
48.0
62.0
86.5
63.5
76.5
69.0
82.0
71.0
63.5
54.0
89.5
77.0
70.5
55.0
38.5
56.5
74.0
46.5
72.5
58.5
83.0
78.5
87.5
62.5
58.0
64.0
64.0
75.0
54.0
93.5
78.0
60.5
69.5
83.0
61.5
78.0
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
58.0
68.0
10.0 58.0
70.0
12.0
39.0
50.0
11.0 38.0
63.0
25.0
50.0
60.0
10.0 50.0
66.0
16.0
58.0
64.0
6.0 58.0
75.0
17.0
55.0
62.0
7.0 55.0
70.0
15.0
85.0
90.0
5.0 79.0
90.0
11.0
79.0
92.0
13.0 81.0
92.0
11.0
48.0
62.0
14.0 48.0
63.0
15.0
80.0
84.0
4.0 78.0
85.0
7.0
73.0
78.0
5.0 58.0
73.0
15.0
49.0
60.0
11.0 49.0
63.0
14.0
54.0
62.0
8.0 56.0
64.0
8.0
79.0
87.0
8.0 75.0
90.0
15.0
63.0
72.0
9.0 68.0
75.0
7.0
71.0
76.0
5.0 65.0
77.0
12.0
57.0
70.0
13.0 60.0
73.0
13.0
70.0
75.0
5.0 70.0
78.0
8.0
65.0
78.0
13.0 65.0
82.0
17.0
55.0
66.0
11.0 55.0
68.0
13.0
50.0
58.0
8.0 50.0
58.0
8.0
82.0
90.0
8.0 75.0
92.0
17.0
65.0
76.0
11.0 70.0
79.0
9.0
68.0
71.0
3.0 63.0
72.0
9.0
50.0
60.0
10.0 48.0
62.0
14.0
40.0
48.0
8.0 35.0
58.0
23.0
50.0
58.0
8.0 48.0
58.0
10.0
78.0
82.0
4.0 78.0
84.0
6.0
50.0
65.0
15.0 50.0
65.0
15.0
62.0
72.0
10.0 65.0
75.0
10.0
45.0
62.0
17.0 45.0
68.0
23.0
60.0
72.0
12.0 70.0
78.0
8.0
78.0
82.0
4.0 78.0
84.0
6.0
88.0
91.0
3.0 85.0
96.0
11.0
60.0
68.0
8.0 60.0
70.0
10.0
53.0
65.0
12.0 58.0
68.0
10.0
50.0
70.0
20.0 50.0
68.0
18.0
65.0
70.0
5.0 68.0
75.0
7.0
70.0
78.0
8.0 70.0
80.0
10.0
55.0
66.0
11.0 55.0
70.0
15.0
85.0
94.0
9.0 83.0
95.0
12.0
79.0
88.0
9.0 79.0
93.0
14.0
50.0
65.0
15.0 50.0
67.0
17.0
65.0
75.0
10.0 65.0
77.0
12.0
78.0
85.0
7.0 78.0
92.0
14.0
58.0
67.0
9.0 60.0
68.0
8.0
76.0
84.0
8.0 78.0
90.0
12.0
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
Country
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Current
Rating
60.5
53.5
47.5
68.0
45.0
60.5
75.5
84.5
90.0
59.0
51.5
58.0
41.5
92.0
67.5
78.0
70.5
85.5
69.5
70.5
62.5
50.5
79.0
78.0
78.5
60.0
32.5
62.0
78.5
94.5
60.0
56.5
71.5
61.5
86.5
69.0
68.5
71.0
73.5
63.0
47.5
76.0
90.5
91.0
57.5
58.5
44.0
88.5
75.5
49.0
72.0
53.5
September 2003
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
60.5
68.0
7.5 60.0
72.0
12.0
50.0
57.0
7.0 50.0
59.0
9.0
48.0
56.0
8.0 50.0
60.0
10.0
65.0
70.0
5.0 65.0
72.0
7.0
30.0
45.0
15.0 30.0
60.0
30.0
60.0
66.0
6.0 58.0
68.0
10.0
70.0
74.0
4.0 65.0
80.0
15.0
78.0
86.0
8.0 78.0
86.0
8.0
80.0
90.0
10.0 83.0
90.0
7.0
50.0
63.0
13.0 50.0
67.0
17.0
40.0
58.0
18.0 40.0
64.0
24.0
25.0
60.0
35.0 25.0
65.0
40.0
38.0
49.5
11.5 30.0
68.0
38.0
80.0
90.0
10.0 77.0
92.0
15.0
56.0
68.0
12.0 54.0
75.0
21.0
73.0
78.0
5.0 70.0
80.0
10.0
68.0
76.0
8.0 70.0
79.0
9.0
80.0
88.0
8.0 76.0
92.0
16.0
68.0
74.0
6.0 68.0
78.0
10.0
66.0
70.0
4.0 60.0
70.0
10.0
58.0
64.0
6.0 50.0
68.0
18.0
25.0
60.0
35.0 25.0
65.0
40.0
62.0
80.0
18.0 65.0
82.0
17.0
68.0
78.0
10.0 60.0
80.0
20.0
75.0
81.0
6.0 75.0
85.0
10.0
50.0
60.0
10.0 45.0
62.0
17.0
30.0
45.0
15.0 30.0
55.0
25.0
60.0
66.0
6.0 35.0
65.0
30.0
63.0
69.0
6.0 63.0
74.0
11.0
91.0
93.0
2.0 88.0
93.0
5.0
61.0
67.0
6.0 60.0
68.0
8.0
50.0
60.0
10.0 50.0
67.0
17.0
60.0
73.0
13.0 58.0
75.0
17.0
55.0
66.0
11.0 50.0
67.0
17.0
82.0
88.0
6.0 80.0
87.0
7.0
62.0
70.0
8.0 60.0
75.0
15.0
58.0
68.0
10.0 60.0
70.0
10.0
60.0
69.0
9.0 55.0
70.0
15.0
65.0
74.0
9.0 60.0
76.0
16.0
56.0
65.0
9.0 50.0
67.0
17.0
40.0
48.0
8.0 30.0
55.0
25.0
68.0
77.0
9.0 68.0
78.0
10.0
84.0
94.0
10.0 88.0
94.0
6.0
88.0
92.0
4.0 85.0
95.0
10.0
56.0
63.0
7.0 48.0
64.0
16.0
53.0
65.0
12.0 50.0
63.0
13.0
35.0
60.0
25.0 45.0
67.0
22.0
83.0
92.0
9.0 80.0
95.0
15.0
76.0
78.0
2.0 68.0
74.0
6.0
40.0
57.0
17.0 40.0
62.0
22.0
65.0
75.0
10.0 58.0
78.0
20.0
48.0
55.0
7.0 48.0
58.0
10.0
Reproduction without permission of the Publisher is strictly forbidden
S-27
International Country Risk Guide
Country
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
S-28
Current
Rating
57.0
62.5
68.0
76.5
86.0
73.0
71.0
67.5
67.0
59.0
62.0
56.0
86.5
78.5
80.0
27.0
65.5
82.0
59.0
45.0
65.0
90.5
91.0
64.5
76.0
60.5
71.5
51.0
67.0
73.0
65.5
56.5
59.5
78.0
86.0
81.0
70.5
50.0
65.5
62.5
57.5
38.0
September 2003
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
48.0
60.0
12.0 30.0
65.0
35.0
50.0
68.0
18.0 50.0
69.0
19.0
55.0
72.0
17.0 65.0
74.0
9.0
70.0
85.0
15.0 76.0
86.0
10.0
79.0
86.0
7.0 78.0
90.0
12.0
73.0
77.0
4.0 70.0
78.0
8.0
67.0
74.0
7.0 60.0
78.0
18.0
65.0
71.5
6.5 59.0
78.0
19.0
55.0
72.0
17.0 55.0
73.0
18.0
53.0
58.0
5.0 50.0
58.0
8.0
25.0
65.0
40.0 25.0
68.0
43.0
50.0
60.0
10.0 25.0
62.0
37.0
84.0
88.0
4.0 65.0
88.0
23.0
73.0
85.0
12.0 76.0
85.0
9.0
78.0
87.0
9.0 76.0
92.0
16.0
28.0
45.0
17.0 28.0
56.0
28.0
58.0
66.0
8.0 55.0
70.0
15.0
75.0
85.0
10.0 74.0
90.0
16.0
45.0
68.0
23.0 45.0
72.0
27.0
30.0
50.0
20.0 28.0
60.0
32.0
60.0
68.0
8.0 55.0
68.0
13.0
84.0
90.0
6.0 80.0
92.0
12.0
88.0
92.0
4.0 80.0
92.0
12.0
55.0
69.0
14.0 48.0
70.0
22.0
70.0
87.0
17.0 60.0
80.0
20.0
60.0
65.0
5.0 58.0
68.0
10.0
64.0
75.0
11.0 60.0
75.0
15.0
48.0
55.0
7.0 48.0
63.0
15.0
65.0
70.0
5.0 65.0
70.0
5.0
50.0
73.0
23.0 50.0
76.0
26.0
57.0
68.0
11.0 63.0
70.0
7.0
50.0
58.0
8.0 50.0
63.0
13.0
57.0
63.0
6.0 57.0
70.0
13.0
70.0
78.0
8.0 65.0
78.0
13.0
78.0
89.0
11.0 78.0
92.0
14.0
76.0
83.0
7.0 78.0
88.0
10.0
65.0
76.0
11.0 65.0
77.0
12.0
50.0
67.0
17.0 50.0
74.0
24.0
63.0
67.0
4.0 60.0
69.0
9.0
60.0
64.0
4.0 55.0
69.0
14.0
68.0
70.0
2.0 65.0
73.0
8.0
25.0
60.0
35.0 25.0
70.0
45.0
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
September 2003
TABLE 4A
FINANCIAL RISK RATINGS OVER THE PERIOD OCTOBER 2002 THROUGH
SEPTEMBER 2003
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
10/02
35.0
38.5
22.5
17.5
31.0
36.5
43.5
40.0
31.0
44.0
35.5
33.5
39.5
34.0
45.0
26.5
49.5
36.0
25.5
32.5
40.0
37.5
45.0
35.5
25.0
30.5
37.0
28.0
37.0
31.0
43.5
38.0
42.0
37.0
31.0
38.5
42.0
37.5
31.5
39.0
40.0
35.5
29.0
40.5
30.0
33.5
38.5
11/02
35.0
41.0
23.0
17.5
31.0
36.5
43.5
40.0
31.0
44.0
36.0
33.5
39.5
34.0
45.0
24.0
49.5
36.0
25.5
32.5
40.0
37.0
45.0
35.0
27.5
30.5
37.0
28.0
37.0
31.0
43.0
38.0
42.0
35.5
31.0
38.5
42.0
37.5
31.5
39.0
40.0
35.5
29.0
40.5
29.0
33.5
38.5
12/02
35.0
41.0
23.0
17.5
31.0
36.5
43.0
40.0
31.0
44.0
36.0
34.0
39.0
34.0
43.5
23.5
49.5
35.5
25.0
32.0
40.0
38.0
45.0
35.5
27.0
30.0
36.0
27.5
36.5
30.5
43.0
38.0
41.5
32.0
31.0
39.5
42.0
37.0
31.5
38.5
39.5
35.0
29.0
40.0
29.5
33.0
38.5
01/03
35.0
41.0
25.0
16.0
31.0
36.5
42.5
40.0
31.0
44.0
36.0
35.0
38.5
36.0
43.5
24.5
50.0
35.0
24.5
31.5
40.0
37.5
45.0
34.5
30.0
29.5
36.5
30.0
36.0
30.5
42.5
38.5
41.0
33.5
31.0
39.0
39.5
36.5
31.5
38.0
39.0
33.5
29.5
39.5
29.5
32.5
38.5
02/03
35.0
42.0
25.5
17.0
31.0
36.0
42.5
40.0
31.0
44.0
40.5
35.0
38.5
36.0
44.0
25.0
50.0
35.5
24.5
33.0
40.0
37.0
45.0
34.0
21.5
29.5
36.0
30.0
36.0
30.5
42.5
38.5
41.0
33.5
31.0
39.0
39.5
36.5
31.5
38.0
39.0
33.5
29.0
41.0
30.0
35.5
40.0
03/03
34.0
42.0
25.0
16.5
31.0
36.0
42.5
40.0
31.0
44.0
40.5
34.5
38.5
36.0
44.0
24.5
50.0
35.5
24.5
33.0
40.0
36.5
45.0
34.0
21.5
30.5
36.0
30.0
36.0
29.5
42.5
38.0
41.0
33.5
31.0
36.0
39.5
36.5
31.5
38.0
39.0
33.5
28.5
41.0
30.0
35.5
40.0
04/03
33.5
42.0
25.0
24.0
31.0
36.5
42.5
40.0
31.0
44.0
40.5
35.5
38.5
36.0
44.5
25.5
50.0
35.5
24.5
33.0
40.0
35.5
45.0
33.5
21.0
30.5
36.0
30.0
36.5
29.5
42.5
39.5
41.0
33.5
31.0
34.5
39.5
36.5
31.5
38.0
39.0
33.5
29.0
41.0
30.5
35.5
40.0
05/03
33.5
42.0
25.5
24.0
31.0
36.5
41.5
39.0
31.0
44.0
39.5
37.5
38.5
36.0
44.5
27.0
46.5
35.5
24.5
33.0
42.5
36.0
45.0
34.0
20.0
30.5
35.5
30.0
36.5
29.5
43.0
39.5
41.0
34.0
34.5
34.0
39.5
36.5
31.5
38.0
39.0
33.5
28.5
41.0
30.5
35.5
40.0
Reproduction without permission of the Publisher is strictly forbidden
06/03
33.0
42.0
25.5
23.0
31.0
36.0
41.5
39.0
31.0
44.0
39.5
37.5
40.5
36.5
45.0
30.5
50.0
35.5
24.5
33.0
42.0
37.0
45.0
35.0
21.0
31.0
35.5
30.0
36.0
29.5
42.5
39.0
41.5
31.5
34.5
34.0
39.5
36.5
31.5
36.0
39.0
33.5
29.0
41.0
32.0
35.5
40.0
07/03
33.5
42.0
25.5
29.5
31.0
35.5
42.0
39.0
31.0
44.0
39.5
37.5
41.0
37.0
45.0
31.5
50.0
36.0
25.0
33.5
42.0
37.5
45.0
37.0
24.5
31.5
36.0
30.5
36.5
29.5
43.0
41.0
42.0
31.5
34.5
34.5
39.5
37.0
31.5
39.0
39.5
34.0
28.5
41.5
32.5
36.0
40.0
08/03
33.5
43.5
25.5
29.0
31.0
35.5
42.0
38.5
37.5
44.0
39.5
38.0
41.0
37.0
44.5
31.5
50.0
36.5
23.5
33.5
42.0
37.5
45.5
38.5
24.0
31.5
36.0
30.5
36.5
29.5
43.0
40.5
42.0
29.5
34.5
34.0
39.5
37.0
31.5
39.0
40.0
34.0
29.5
41.5
33.0
36.5
40.0
09/03
33.5
43.5
25.5
29.5
31.0
35.5
42.0
38.5
37.5
44.0
39.5
38.0
41.5
37.0
44.0
30.5
50.0
36.5
23.5
33.5
42.0
37.5
45.5
39.5
24.5
23.0
37.0
30.5
37.0
28.5
43.5
41.0
42.0
29.5
34.5
34.0
39.5
37.0
31.5
36.0
40.0
34.0
29.0
41.5
33.5
36.5
40.0
S-29
International Country Risk Guide
COUNTRY
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
S-30
10/02
40.0
22.0
30.0
35.5
34.5
44.5
38.0
31.0
41.0
34.0
29.5
31.0
42.0
37.0
40.5
36.0
47.5
36.5
37.5
35.0
19.5
40.0
48.0
39.5
25.0
19.0
36.5
37.0
43.5
32.0
26.0
42.0
32.0
37.5
34.5
30.5
31.5
37.5
33.5
38.5
42.0
38.0
29.5
23.0
26.0
35.5
45.5
42.5
33.5
34.5
36.5
35.5
37.5
38.0
11/02
40.0
22.0
30.0
35.0
34.5
44.5
37.5
31.0
41.0
34.0
29.5
31.0
42.0
37.0
40.5
36.0
47.5
36.5
37.0
35.0
19.5
40.0
48.0
39.5
22.5
19.0
36.5
37.0
43.5
32.0
27.0
42.0
32.0
37.5
35.5
30.5
31.5
37.5
34.0
38.5
44.5
38.0
30.5
22.5
26.0
37.0
45.5
42.5
33.5
34.5
37.0
35.5
37.0
38.0
12/02
40.0
21.5
30.0
31.0
34.5
44.5
37.5
31.0
41.0
34.0
29.5
31.0
41.5
37.5
40.0
36.0
47.5
36.5
37.0
35.0
19.5
40.0
48.0
39.5
25.0
19.0
36.5
37.0
43.0
32.0
26.0
42.0
31.5
37.5
35.0
30.5
31.5
37.5
34.0
38.5
42.0
37.5
30.0
22.5
25.5
36.5
45.5
42.5
33.5
34.5
38.5
33.5
38.5
38.0
September 2003
01/03
40.0
21.0
30.0
31.5
34.5
44.5
37.0
30.5
41.0
35.5
29.5
31.0
40.5
38.5
39.5
36.0
47.0
36.5
37.0
35.0
26.5
40.0
48.0
39.5
25.0
19.0
46.0
36.5
42.5
32.0
26.0
42.0
31.0
37.0
34.5
30.5
31.5
37.0
34.0
39.0
42.0
39.0
29.5
23.0
25.0
37.0
45.0
42.5
33.5
34.5
38.0
33.5
38.5
37.0
02/03
35.5
21.0
29.5
30.5
34.5
44.5
37.0
30.5
41.0
35.5
29.5
31.0
40.5
38.0
39.5
37.5
47.5
36.5
38.0
36.0
26.5
39.5
48.0
39.5
25.0
19.0
46.5
36.5
42.5
32.0
27.5
40.0
31.0
37.0
34.5
30.5
31.5
37.5
34.0
39.0
43.0
39.0
29.0
23.0
25.0
37.0
45.5
42.5
33.5
34.5
38.0
31.5
38.5
37.0
03/03
35.5
21.0
29.5
28.0
34.5
44.5
35.0
30.0
41.0
35.5
36.0
31.0
40.5
38.0
42.5
36.5
49.0
36.5
38.0
36.0
26.5
40.0
47.5
39.5
25.0
19.0
46.0
36.5
42.5
32.0
27.0
40.0
31.0
37.0
34.5
30.0
31.5
38.0
34.0
39.0
42.0
39.0
28.5
23.0
25.0
37.5
45.5
42.5
33.5
34.5
38.5
31.5
37.0
36.5
04/03
35.5
21.0
29.5
30.0
35.5
44.5
35.0
31.0
43.0
36.0
36.0
25.0
40.5
38.5
42.5
36.0
49.0
36.5
38.0
36.0
26.5
41.5
47.5
39.5
25.0
19.0
46.0
36.5
42.5
31.5
27.5
40.0
31.0
37.0
35.5
30.5
31.5
38.5
34.0
39.0
42.0
39.0
29.5
23.5
25.0
36.5
47.0
42.5
36.5
35.0
38.5
31.5
37.0
36.0
05/03
35.5
21.0
29.5
30.5
35.5
44.5
35.0
31.0
43.0
36.0
36.0
25.0
40.5
38.5
42.5
34.0
49.0
36.5
37.0
36.5
26.5
41.5
47.5
39.5
25.0
19.0
46.0
36.5
42.5
32.0
28.0
40.0
31.0
37.0
36.5
30.0
31.5
38.5
34.0
39.5
42.0
39.0
29.5
25.5
25.0
36.5
47.5
42.5
36.5
35.0
38.5
33.5
37.5
37.5
Reproduction without permission of the Publisher is strictly forbidden
06/03
35.5
21.0
29.5
31.0
35.5
44.5
34.0
30.5
43.0
36.0
36.0
25.0
40.5
38.5
42.0
32.0
49.0
36.5
37.0
36.5
26.5
41.5
47.0
39.5
25.0
19.0
46.0
36.5
42.5
32.0
27.0
40.0
31.0
36.5
37.5
31.0
31.5
38.0
34.0
39.5
42.5
39.0
29.5
25.5
25.0
36.5
47.5
42.5
36.5
35.0
35.5
37.0
37.5
38.0
07/03
35.5
21.5
29.5
32.5
35.5
44.0
35.0
31.0
43.0
34.5
36.5
25.5
41.5
38.5
42.5
33.5
49.0
36.5
37.0
36.5
26.5
41.5
47.0
39.5
25.0
19.0
46.0
37.0
43.0
32.0
27.5
40.0
31.5
37.0
37.0
31.0
31.5
38.5
34.0
39.5
43.0
39.5
29.5
25.5
25.5
37.5
47.5
42.0
40.5
35.0
35.0
39.0
37.5
36.5
08/03
35.5
21.5
29.5
30.5
35.5
44.0
35.0
31.5
43.0
34.5
36.5
25.5
41.5
38.5
42.5
35.5
50.0
36.5
37.0
36.5
26.5
41.5
47.0
39.5
25.0
19.0
46.0
37.0
43.0
31.5
27.5
41.0
31.5
37.0
37.5
31.0
31.5
39.5
34.0
39.5
41.5
39.5
31.0
25.5
25.5
39.0
47.5
42.0
40.5
35.0
35.0
39.0
37.5
37.0
09/03
35.5
21.5
29.5
31.5
36.0
44.0
34.5
31.5
44.0
34.5
46.5
22.5
41.5
39.5
43.0
36.0
50.0
36.5
37.0
36.5
26.5
42.0
47.5
39.5
25.0
18.5
44.0
37.0
43.0
32.0
25.5
41.0
31.5
37.5
38.0
31.0
31.5
40.0
34.0
39.5
41.0
39.5
30.5
25.0
25.5
39.0
47.5
42.0
40.5
35.0
35.0
39.0
37.5
36.5
International Country Risk Guide
COUNTRY
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
10/02
39.0
35.0
36.5
36.5
39.0
43.5
36.0
26.0
23.5
45.5
37.0
41.5
35.5
37.5
39.5
35.5
30.5
27.5
36.5
46.5
38.0
46.0
20.5
40.0
34.5
40.0
36.5
33.5
35.5
39.5
43.0
37.0
35.0
26.5
33.0
36.0
35.0
20.5
29.5
11/02
39.0
35.0
36.5
37.0
39.0
43.5
36.0
26.0
23.5
45.5
37.0
41.5
35.5
40.0
39.5
36.0
30.5
27.5
36.5
46.5
38.0
46.0
21.0
40.0
34.5
40.0
36.5
32.0
35.0
39.5
43.0
36.5
34.5
27.5
33.5
36.0
35.0
21.5
29.5
12/02
39.0
34.5
36.5
37.0
39.0
43.5
35.5
26.0
23.0
45.5
37.0
41.5
35.5
37.5
39.0
36.0
30.5
27.0
36.5
46.0
36.5
46.0
21.0
40.0
34.0
40.5
36.5
32.5
34.5
39.5
43.0
36.5
34.5
27.0
34.0
36.0
35.0
19.0
29.5
September 2003
01/03
39.5
34.0
36.5
37.5
39.5
45.0
35.0
25.5
23.0
45.5
36.5
41.0
35.5
37.5
38.5
36.0
30.5
37.0
38.5
45.5
39.5
46.0
21.5
39.5
33.5
40.5
36.0
27.5
34.5
39.5
43.0
36.0
32.5
27.5
34.5
36.0
35.0
24.5
29.5
02/03
39.5
34.0
36.5
37.5
42.5
45.0
35.0
25.5
23.0
45.5
36.5
40.5
35.5
38.5
38.5
36.0
30.5
34.5
38.5
46.0
39.5
47.5
21.5
39.5
33.5
43.0
36.0
28.0
34.5
39.5
44.0
42.0
34.0
27.0
33.5
36.0
35.0
24.5
29.5
03/03
39.5
34.0
36.5
37.5
42.5
45.0
35.0
23.5
45.5
36.0
40.5
35.5
37.5
38.5
36.5
30.5
34.5
38.5
46.0
39.0
47.5
20.5
39.5
31.5
43.0
36.5
28.5
34.5
39.5
44.0
42.0
31.5
21.5
34.5
36.0
35.0
25.5
22.0
29.5
04/03
39.5
35.0
36.5
39.0
42.5
45.5
35.0
25.5
22.5
45.5
37.0
40.5
35.5
37.5
38.5
36.5
30.5
32.0
38.5
46.0
39.0
47.5
21.0
39.5
33.5
43.0
36.5
28.5
35.0
39.5
44.0
42.5
34.0
22.5
34.5
38.5
35.0
21.0
20.0
05/03
39.5
35.0
36.5
39.0
42.5
45.5
35.0
25.5
21.5
45.5
37.0
41.0
35.5
38.0
38.5
36.5
30.5
35.5
38.5
47.0
38.5
47.5
21.0
39.5
33.5
43.5
37.0
29.5
34.5
39.5
44.0
42.5
34.0
23.0
36.0
38.5
35.0
23.0
20.0
Reproduction without permission of the Publisher is strictly forbidden
06/03
39.5
35.5
36.5
39.0
42.5
45.5
35.0
25.5
22.0
45.5
35.5
40.5
35.5
37.5
38.5
36.5
30.5
35.5
38.5
46.5
38.5
47.5
20.5
39.5
33.5
43.5
36.5
32.0
34.0
39.5
44.0
42.5
34.5
24.0
38.5
38.5
35.0
24.0
22.5
07/03
39.0
36.0
36.5
39.0
42.5
45.5
35.5
26.0
22.0
45.5
37.0
41.0
35.5
38.0
39.0
36.5
30.5
35.5
39.0
47.5
38.5
47.5
20.5
39.5
34.0
43.5
36.5
31.5
34.0
39.5
44.0
42.5
32.5
30.5
39.0
38.5
35.0
24.5
22.5
08/03
39.0
36.0
36.5
39.0
43.0
45.5
35.5
26.0
21.0
45.5
37.0
41.0
35.5
36.5
39.0
36.5
30.5
35.5
39.5
47.5
39.0
47.0
20.5
39.5
34.0
45.0
36.5
31.5
34.0
39.5
45.0
42.5
32.5
32.5
41.5
38.5
35.0
24.5
22.5
09/03
39.0
36.5
36.5
38.5
43.0
45.5
35.5
26.0
21.0
45.5
37.5
41.5
35.5
36.0
39.0
37.0
29.5
35.5
40.0
47.5
39.0
47.0
21.0
39.5
34.0
45.0
36.0
31.5
34.0
40.5
45.0
42.5
33.0
30.5
42.5
38.5
35.0
25.0
21.0
S-31
International Country Risk Guide
September 2003
TABLE 4B
FINANCIAL RISK POINTS BY COMPONENT – SEPTEMBER 2003
This table lists the total points for each of the following financial risk indicators out of the
maximum points indicated in parentheses. The final columns in the table show the overall
financial risk rating (the sum of the points awarded to each component) and the change from
the preceding month. Changes in the points awarded to the individual risk components are
shown in Tables 12 through 16.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Rep.
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
S-32
Total Foreign
Debt as
percent of
GDP
(10 points)
4.5
5.5
2.0
5.5
5.5
5.0
9.0
8.0
6.5
10.0
6.5
9.5
8.5
5.5
7.5
5.0
10.0
4.5
4.5
4.5
8.5
4.5
9.0
6.0
0.0
0.5
6.5
1.0
5.5
5.5
10.0
7.0
8.0
7.5
4.0
6.5
Debt Service
as percent of
Exports of
Goods and
Services
(10 points)
6.5
8.0
9.0
1.0
7.0
9.0
10.0
9.5
9.5
9.0
9.0
9.0
10.0
8.5
10.0
3.5
10.0
8.0
7.5
7.0
10.0
7.0
9.5
8.0
9.5
7.5
9.0
5.5
9.0
5.5
8.5
9.0
8.5
9.5
8.0
9.0
Current
InterAccount as
Exchange
national
percent of
Liquidity as Rate Stability
Exports of
months of as percentage
Goods and
Financial
change
import cover
Services
(10 points) Risk Rating
(5 points)
(15 points)
10.0
3.0
9.5 33.5
0.0
15.0
5.0
10.0 43.5
0.0
11.5
1.0
2.0 25.5
0.0
14.5
0.0
8.5 29.5
0.5
7.0
1.5
10.0 31.0
0.0
10.5
2.0
9.0 35.5
0.0
12.0
1.5
9.5 42.0
0.0
9.5
1.5
10.0 38.5
0.0
9.5
2.0
10.0 37.5
0.0
12.0
3.0
10.0 44.0
0.0
12.5
1.5
10.0 39.5
0.0
11.0
0.0
8.5 38.0
0.0
12.5
1.0
9.5 41.5
0.5
11.0
2.5
9.5 37.0
0.0
13.5
5.0
8.0 44.0 -0.5
12.0
1.0
9.0 30.5 -1.0
15.0
5.0
10.0 50.0
0.0
11.5
3.0
9.5 36.5
0.0
0.0
2.0
9.5 23.5
0.0
11.0
1.5
9.5 33.5
0.0
12.5
1.5
9.5 42.0
0.0
12.0
4.0
10.0 37.5
0.0
12.5
4.5
10.0 45.5
0.0
11.5
4.0
10.0 39.5
1.0
8.0
0.0
7.0 24.5
0.5
5.5
0.0
9.5 23.0 -8.5
11.5
1.0
9.0 37.0
1.0
12.0
2.5
9.5 30.5
0.0
10.0
2.5
10.0 37.0
0.5
7.5
0.0
10.0 28.5 -1.0
12.0
3.0
10.0 43.5
0.5
11.5
3.5
10.0 41.0
0.5
12.5
3.5
9.5 42.0
0.0
11.5
0.0
1.0 29.5
0.0
11.5
1.0
10.0 34.5
0.0
12.0
1.5
5.0 34.0
0.0
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
COUNTRY
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Total Foreign
Debt as
percent of
GDP
(10 points)
7.0
9.0
2.5
2.5
8.0
4.5
1.0
9.0
2.5
7.0
8.5
5.0
0.0
0.0
7.0
4.0
8.0
5.0
1.5
8.0
3.0
10.0
0.0
9.0
5.0
9.5
5.5
10.0
3.5
4.0
5.0
2.5
7.0
8.0
7.5
0.5
0.0
7.5
6.0
10.0
3.0
0.5
6.0
2.0
3.5
8.0
4.5
3.5
Debt Service
as percent of
Exports of
Goods and
Services
(10 points)
9.0
6.0
7.5
8.5
8.0
9.0
9.0
9.5
8.0
8.0
8.5
8.0
8.0
9.0
9.5
8.5
10.0
8.0
8.0
9.0
6.5
9.5
0.0
10.0
8.5
10.0
8.0
10.0
8.0
8.5
8.0
3.0
9.0
10.0
9.5
9.5
2.0
9.5
8.5
10.0
8.5
8.0
9.5
9.0
9.0
6.5
5.5
8.5
September 2003
Current
InterAccount as
Exchange
national
percent of
Liquidity as Rate Stability
Exports of
months of as percentage
Goods and
Financial
change
import cover
Services
(10 points) Risk Rating
(5 points)
(15 points)
11.5
2.0
10.0 39.5
0.0
11.0
1.5
9.5 37.0
0.0
10.0
1.5
10.0 31.5
0.0
13.5
2.0
9.5 36.0 -3.0
13.0
1.5
9.5 40.0
0.0
11.0
0.0
9.5 34.0
0.0
11.0
3.0
5.0 29.0 -0.5
12.5
1.0
9.5 41.5
0.0
12.0
1.0
10.0 33.5
0.5
10.0
2.0
9.5 36.5
0.0
10.0
3.0
10.0 40.0
0.0
11.5
1.0
10.0 35.5
0.0
4.0
0.0
9.5 21.5
0.0
10.5
0.0
10.0 29.5
0.0
10.5
0.0
4.5 31.5
1.0
11.0
2.5
10.0 36.0
0.5
12.5
3.5
10.0 44.0
0.0
10.5
1.0
10.0 34.5 -0.5
9.5
2.5
10.0 31.5
0.0
12.5
4.5
10.0 44.0
1.0
11.5
3.5
10.0 34.5
0.0
13.5
3.5
10.0 46.5 10.0
12.5
0.0
10.0 22.5 -3.0
12.0
1.0
9.5 41.5
0.0
12.0
4.0
10.0 39.5
1.0
12.5
1.5
9.5 43.0
0.5
12.0
3.5
7.0 36.0
0.5
15.0
5.0
10.0 50.0
0.0
11.5
3.5
10.0 36.5
0.0
11.5
3.0
10.0 37.0
0.0
11.5
2.0
10.0 36.5
0.0
11.0
0.0
10.0 26.5
0.0
12.5
3.5
10.0 42.0
0.5
15.0
4.5
10.0 47.5
0.5
10.5
2.0
10.0 39.5
0.0
0.0
5.0
10.0 25.0
0.0
7.0
0.0
9.5 18.5 -0.5
14.0
5.0
8.0 44.0 -2.0
11.0
2.0
9.5 37.0
0.0
12.5
1.0
9.5 43.0
0.0
9.5
1.0
10.0 32.0
0.5
10.0
2.0
5.0 25.5 -2.0
12.5
3.0
10.0 41.0
0.0
9.0
2.0
9.5 31.5
0.0
11.5
3.5
10.0 37.5
0.5
11.5
2.0
10.0 38.0
0.5
11.0
0.0
10.0 31.0
0.0
9.5
0.0
10.0 31.5
0.0
Reproduction without permission of the Publisher is strictly forbidden
S-33
International Country Risk Guide
COUNTRY
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
S-34
Total Foreign
Debt as
percent of
GDP
(10 points)
5.5
3.0
9.5
9.5
7.0
3.0
0.0
3.5
4.5
10.0
7.0
5.0
5.0
5.0
6.0
5.5
4.5
6.0
5.0
3.0
7.0
6.0
9.0
4.5
5.0
8.0
9.0
5.0
9.0
4.5
7.0
8.5
5.0
0.5
6.0
7.0
10.0
7.0
8.5
0.0
5.5
3.5
8.5
5.0
5.0
5.0
7.0
8.0
Debt Service
as percent of
Exports of
Goods and
Services
(10 points)
8.0
9.5
8.5
10.0
9.5
6.0
7.0
6.0
9.5
9.5
9.0
7.0
7.0
8.5
9.0
6.0
8.5
8.5
8.5
7.5
7.5
9.0
9.5
9.5
4.5
3.5
10.0
8.5
9.0
9.0
9.0
8.0
9.0
9.0
9.0
8.5
10.0
10.0
10.0
6.5
8.5
9.0
10.0
8.0
6.0
9.0
9.5
10.0
September 2003
Current
InterAccount as
Exchange
national
percent of
Liquidity as Rate Stability
Exports of
months of as percentage
Goods and
Financial
change
import cover
Services
(10 points) Risk Rating
(5 points)
(15 points)
12.5
4.0
10.0 40.0
0.5
8.5
3.0
10.0 34.0
0.0
11.5
0.0
10.0 39.5
0.0
13.5
1.5
6.5 41.0 -0.5
12.5
1.0
9.5 39.5
0.0
11.5
1.5
8.5 30.5 -0.5
8.5
0.0
9.5 25.0 -0.5
6.5
0.0
9.5 25.5
0.0
11.5
3.5
10.0 39.0
0.0
14.5
3.5
10.0 47.5
0.0
13.0
3.0
10.0 42.0
0.0
15.0
3.5
10.0 40.5
0.0
12.0
1.0
10.0 35.0
0.0
12.5
0.0
9.0 35.0
0.0
12.5
1.5
10.0 39.0
0.0
11.5
4.5
10.0 37.5
0.0
13.0
1.0
9.5 36.5 -0.5
11.0
3.5
10.0 39.0
0.0
11.0
2.5
9.5 36.5
0.5
14.5
1.5
10.0 36.5
0.0
11.0
3.0
10.0 38.5 -0.5
14.5
3.5
10.0 43.0
0.0
13.5
3.5
10.0 45.5
0.0
11.0
1.0
9.5 35.5
0.0
6.5
0.0
10.0 26.0
0.0
2.0
0.0
7.5 21.0
0.0
13.0
3.5
10.0 45.5
0.0
11.5
3.0
9.5 37.5
0.5
11.5
2.0
10.0 41.5
0.5
12.0
0.0
10.0 35.5
0.0
12.0
1.5
6.5 36.0 -0.5
11.5
1.5
9.5 39.0
0.0
11.5
1.5
10.0 37.0
0.5
10.0
0.0
10.0 29.5 -1.0
12.0
1.0
7.5 35.5
0.0
13.0
1.5
10.0 40.0
0.5
14.0
3.5
10.0 47.5
0.0
12.0
0.0
10.0 39.0
0.0
13.5
5.0
10.0 47.0
0.0
4.5
0.5
9.5 21.0
0.5
12.5
3.0
10.0 39.5
0.0
11.0
1.0
9.5 34.0
0.0
13.0
3.5
10.0 45.0
0.0
11.5
1.5
10.0 36.0 -0.5
11.5
0.0
9.0 31.5
0.0
10.0
1.5
8.5 34.0
0.0
13.0
1.0
10.0 40.5
1.0
14.0
3.0
10.0 45.0
0.0
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
COUNTRY
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
Total Foreign
Debt as
percent of
GDP
(10 points)
9.5
9.5
3.5
7.0
6.5
4.5
0.5
1.5
Debt Service
as percent of
Exports of
Goods and
Services
(10 points)
10.0
7.0
4.5
8.0
8.5
7.0
8.5
9.5
September 2003
Current
InterAccount as
Exchange
national
percent of
Liquidity as Rate Stability
Exports of
months of as percentage
Goods and
Financial
change
import cover
Services
(10 points) Risk Rating
(5 points)
(15 points)
12.0
1.0
10.0 42.5
0.0
8.0
0.5
8.0 33.0
0.5
12.5
0.0
10.0 30.5 -2.0
15.0
3.5
9.0 42.5
1.0
12.0
1.5
10.0 38.5
0.0
12.5
1.0
10.0 35.0
0.0
6.0
0.0
10.0 25.0
0.5
10.0
0.0
0.0 21.0 -1.5
Reproduction without permission of the Publisher is strictly forbidden
S-35
International Country Risk Guide
September 2003
TABLE 4C
FINANCIAL RISK FORECASTS
Country
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
S-36
Current
Rating
33.5
43.5
25.5
29.5
31.0
35.5
42.0
38.5
37.5
44.0
39.5
38.0
41.5
37.0
44.0
30.5
50.0
36.5
23.5
33.5
42.0
37.5
45.5
39.5
24.5
23.0
37.0
30.5
37.0
28.5
43.5
41.0
42.0
29.5
34.5
34.0
39.5
37.0
31.5
36.0
40.0
34.0
29.0
41.5
33.5
36.5
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
23.0
36.0
13.0 30.0
36.0
6.0
40.0
45.0
5.0 40.0
45.0
5.0
20.0
27.0
7.0 25.0
32.0
7.0
30.0
35.0
5.0 30.0
39.0
9.0
30.0
32.0
2.0 28.0
36.0
8.0
33.0
36.0
3.0 32.0
41.0
9.0
42.0
44.0
2.0 39.0
48.0
9.0
35.0
40.0
5.0 30.0
42.0
12.0
35.0
38.0
3.0 33.0
38.0
5.0
42.0
45.0
3.0 40.0
46.0
6.0
35.0
40.0
5.0 30.0
39.0
9.0
27.0
29.0
2.0 25.0
31.0
6.0
38.0
40.0
2.0 38.0
42.0
4.0
32.0
35.0
3.0 30.0
37.0
7.0
40.0
45.0
5.0 38.0
47.0
9.0
20.0
28.0
8.0 28.0
40.0
12.0
44.0
46.0
2.0 44.0
48.0
4.0
35.0
37.0
2.0 34.0
39.0
5.0
22.0
27.0
5.0 22.0
30.0
8.0
30.0
35.0
5.0 28.0
37.0
9.0
36.0
38.0
2.0 33.0
41.0
8.0
34.0
38.0
4.0 34.0
40.0
6.0
43.0
46.0
3.0 38.0
47.0
9.0
35.0
39.0
4.0 30.0
39.0
9.0
26.0
30.0
4.0 24.0
37.0
13.0
29.0
31.0
2.0 25.0
34.0
9.0
36.0
38.0
2.0 30.0
39.0
9.0
29.0
30.5
1.5 29.0
34.0
5.0
35.0
37.0
2.0 30.0
38.0
8.0
27.0
30.0
3.0 20.0
36.0
16.0
42.0
44.0
2.0 39.0
44.0
5.0
38.0
40.0
2.0 37.0
40.0
3.0
37.0
39.0
2.0 35.0
40.0
5.0
27.0
30.0
3.0 26.0
34.0
8.0
24.0
28.0
4.0 23.0
33.0
10.0
37.0
38.0
1.0 30.0
37.0
7.0
41.0
43.0
2.0 37.0
42.0
5.0
35.0
38.0
3.0 33.0
40.0
7.0
20.0
23.0
3.0 22.0
27.0
5.0
34.0
39.0
5.0 33.0
40.0
7.0
38.0
40.0
2.0 36.0
42.0
6.0
33.0
37.0
4.0 30.0
40.0
10.0
33.0
34.0
1.0 30.0
38.0
8.0
40.0
42.5
2.5 38.0
46.0
8.0
30.0
32.0
2.0 28.0
33.0
5.0
34.0
37.0
3.0 32.0
40.0
8.0
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
Country
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Current
Rating
40.0
35.5
21.5
29.5
31.5
36.0
44.0
34.5
31.5
44.0
34.5
46.5
22.5
41.5
39.5
43.0
36.0
50.0
36.5
37.0
36.5
26.5
42.0
47.5
39.5
25.0
18.5
44.0
37.0
43.0
32.0
25.5
41.0
31.5
37.5
38.0
31.0
31.5
40.0
34.0
39.5
41.0
39.5
30.5
25.0
25.5
39.0
47.5
42.0
40.5
35.0
35.0
September 2003
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
38.0
41.0
3.0 30.0
42.0
12.0
34.0
36.0
2.0 30.0
36.0
6.0
20.0
24.0
4.0 26.0
32.0
6.0
27.5
30.0
2.5 25.0
31.0
6.0
27.0
32.0
5.0 25.0
36.0
11.0
30.0
36.0
6.0 30.0
38.0
8.0
39.0
44.0
5.0 36.0
44.0
8.0
33.0
37.0
4.0 30.0
38.0
8.0
30.0
33.0
3.0 28.0
35.0
7.0
40.0
44.0
4.0 34.0
45.0
11.0
30.0
35.0
5.0 25.0
38.0
13.0
25.0
38.0
13.0 25.0
42.0
17.0
20.0
27.0
7.0 25.0
40.0
15.0
41.0
43.0
2.0 37.0
43.0
6.0
34.0
40.0
6.0 32.0
40.0
8.0
38.0
43.0
5.0 37.0
45.0
8.0
35.0
37.0
2.0 32.0
39.0
7.0
49.0
50.0
1.0 45.0
50.0
5.0
35.0
37.0
2.0 35.0
40.0
5.0
36.0
38.0
2.0 33.0
41.0
8.0
35.0
37.0
2.0 30.0
38.0
8.0
18.0
18.0
0.0 18.0
28.0
10.0
37.0
42.5
5.5 30.0
45.0
15.0
43.0
48.0
5.0 45.0
48.0
3.0
36.0
40.0
4.0 30.0
42.0
12.0
27.0
30.0
3.0 25.0
35.0
10.0
18.0
21.0
3.0 20.0
25.0
5.0
43.0
47.0
4.0 40.0
47.0
7.0
38.0
40.0
2.0 33.0
41.0
8.0
43.0
44.0
1.0 40.0
44.0
4.0
32.0
35.0
3.0 30.0
36.0
6.0
25.0
27.0
2.0 25.0
27.0
2.0
40.0
42.5
2.5 37.0
43.0
6.0
32.0
34.0
2.0 28.0
37.0
9.0
37.0
38.0
1.0 34.0
38.0
4.0
35.0
38.0
3.0 30.0
39.0
9.0
22.0
22.0
0.0 20.0
30.0
10.0
34.0
36.0
2.0 30.0
37.0
7.0
37.0
40.0
3.0 35.0
41.0
6.0
30.0
35.0
5.0 26.0
35.0
9.0
37.0
39.0
2.0 30.0
38.0
8.0
39.0
42.0
3.0 36.0
43.0
7.0
38.0
39.0
1.0 36.0
39.0
3.0
30.0
33.0
3.0 28.0
38.0
10.0
15.0
19.0
4.0 17.0
24.0
7.0
30.0
31.0
1.0 28.0
35.0
7.0
36.0
39.0
3.0 30.0
39.0
9.0
45.0
46.0
1.0 40.0
47.0
7.0
35.0
38.0
3.0 33.0
38.0
5.0
28.0
30.0
2.0 25.0
30.0
5.0
31.0
36.0
5.0 30.0
39.0
9.0
28.0
35.0
7.0 27.0
38.0
11.0
Reproduction without permission of the Publisher is strictly forbidden
S-37
International Country Risk Guide
Country
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
S-38
Current
Rating
39.0
37.5
36.5
39.0
36.5
36.5
38.5
43.0
45.5
35.5
26.0
21.0
45.5
37.5
41.5
35.5
36.0
39.0
37.0
29.5
35.5
40.0
47.5
39.0
47.0
21.0
39.5
34.0
45.0
36.0
31.5
34.0
40.5
45.0
42.5
33.0
30.5
42.5
38.5
35.0
25.0
21.0
September 2003
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
37.0
39.0
2.0 30.0
39.0
9.0
34.0
37.0
3.0 30.0
38.0
8.0
35.0
37.0
2.0 30.0
37.0
7.0
37.0
39.0
2.0 34.0
38.0
4.0
33.0
36.0
3.0 30.0
38.0
8.0
25.0
27.0
2.0 23.0
30.0
7.0
35.0
39.0
4.0 30.0
41.0
11.0
40.0
45.0
5.0 40.0
46.0
6.0
38.0
41.0
3.0 36.0
45.0
9.0
32.0
34.0
2.0 25.0
36.0
11.0
20.0
28.0
8.0 20.0
36.0
16.0
20.0
24.0
4.0 25.0
28.0
3.0
43.0
45.0
2.0 38.0
47.0
9.0
36.0
38.0
2.0 33.0
40.0
7.0
38.0
42.0
4.0 35.0
39.0
4.0
18.0
20.0
2.0 18.0
27.0
9.0
35.0
38.0
3.0 30.0
38.0
8.0
36.0
40.0
4.0 38.0
44.0
6.0
28.0
38.0
10.0 27.0
38.0
11.0
25.0
32.0
7.0 25.0
36.0
11.0
34.0
36.0
2.0 32.0
38.0
6.0
34.0
36.0
2.0 30.0
37.0
7.0
46.5
48.0
1.5 45.0
48.0
3.0
32.0
34.0
2.0 33.0
36.0
3.0
45.0
48.0
3.0 40.0
48.0
8.0
20.0
24.0
4.0 20.0
28.0
8.0
35.0
37.0
2.0 28.0
37.0
9.0
30.0
34.0
4.0 30.0
36.0
6.0
43.0
45.5
2.5 40.0
47.0
7.0
33.0
37.0
4.0 30.0
38.0
8.0
30.0
32.0
2.0 30.0
37.0
7.0
31.0
33.0
2.0 28.0
35.0
7.0
35.0
40.0
5.0 30.0
43.0
13.0
44.0
46.0
2.0 40.0
47.0
7.0
40.0
43.0
3.0 39.0
44.0
5.0
34.0
36.0
2.0 30.0
38.0
8.0
22.0
28.0
6.0 25.0
32.0
7.0
33.0
36.0
3.0 30.0
39.0
9.0
36.0
39.0
3.0 35.0
43.0
8.0
31.0
33.0
2.0 30.0
36.0
6.0
16.0
18.0
2.0 16.0
25.0
9.0
20.0
25.0
5.0 18.0
30.0
12.0
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
September 2003
TABLE 5A
ECONOMIC RISK RATINGS OVER THE PERIOD OCTOBER 2002 THROUGH
SEPTEMBER 2003
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, P. Rep.
Colombia
Congo, D. Rep
Congo, Rep.
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Rep.
Denmark
Dominican R.
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
10/02 11/02 12/02 01/03 02/03 03/03 04/03 05/03 06/03 07/03 08/03 09/03
31.5 31.5 31.5 32.0 31.5 31.5 31.5 32.0 32.0 32.0 32.0 32.0
38.0 40.5 40.5 40.5 43.5 43.5 43.5 43.5 43.5 43.5 43.5 43.5
30.0 30.0 30.0 29.5 29.5 29.5 29.5 29.5 29.5 26.0 26.0 26.0
24.0 24.0 24.0 29.5 29.5 29.5 29.5 29.5 29.5 36.5 36.5 36.5
30.5 30.5 30.5 30.5 30.5 30.5 30.5 30.5 30.5 30.5 30.5 32.5
41.5 41.5 41.5 41.0 41.0 41.0 41.0 41.0 41.0 41.0 41.0 41.0
40.0 40.0 40.0 39.5 39.5 39.5 39.5 40.0 40.0 40.0 40.0 40.0
36.0 35.5 35.5 35.5 35.5 35.5 35.5 35.0 35.0 35.0 35.0 35.0
36.5 36.5 36.5 36.5 36.5 36.5 36.5 36.5 36.5 36.5 36.0 36.0
38.5 38.5 38.5 38.5 38.5 38.5 38.5 38.5 38.5 38.5 38.5 38.5
34.5 35.5 35.5 35.5 35.0 35.0 35.0 34.0 34.0 34.0 38.5 38.5
30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.0 31.0 30.5 30.5 30.5
43.0 43.0 42.5 42.5 42.5 42.5 42.5 42.5 43.0 43.0 43.0 42.5
33.0 33.0 33.0 34.5 34.5 34.5 34.5 34.5 34.5 33.0 33.0 33.0
39.0 39.0 39.0 38.5 38.5 39.0 39.0 38.5 38.5 38.5 38.5 38.5
32.0 32.0 32.0 32.0 32.0 32.0 32.5 32.0 31.5 31.5 31.5 33.0
46.5 46.5 46.5 44.5 44.5 44.5 44.5 44.5 44.5 44.5 44.5 44.5
33.5 33.5 33.5 33.5 34.5 34.5 34.5 35.0 35.0 35.0 36.0 36.0
28.5 28.5 28.5 28.5 28.5 28.5 28.5 28.5 28.5 28.5 29.5 29.5
38.0 37.5 37.0 37.0 36.5 36.5 36.5 36.5 36.5 36.5 36.5 36.5
43.5 43.5 43.5 44.0 44.0 44.0 44.0 43.5 43.5 42.0 42.0 42.0
38.0 38.0 38.0 39.0 39.0 39.0 38.5 38.5 38.5 39.0 39.0 39.0
38.5 39.0 39.0 39.0 39.0 38.0 38.0 38.5 38.5 38.5 38.5 38.5
33.0 33.0 33.0 33.0 33.0 33.0 33.0 33.0 33.0 33.0 32.5 32.5
18.5 27.0 27.0 28.5 29.5 29.5 29.5 29.0 29.0 29.0 30.0 30.0
36.5 36.5 36.5 36.5 36.5 34.5 34.5 34.5 34.5 34.5 34.5 18.0
36.5 36.5 35.0 35.0 35.0 34.5 34.5 34.5 34.5 34.5 34.5 33.5
32.5 32.5 32.5 34.0 34.0 34.0 34.0 34.0 34.0 34.0 34.0 34.0
35.0 35.0 35.0 35.0 35.0 35.0 35.0 35.0 35.0 35.0 35.0 35.0
35.0 35.0 33.0 33.0 33.0 33.0 33.0 33.0 33.0 33.5 33.5 33.5
41.0 41.0 41.0 41.0 41.0 41.0 41.0 41.0 41.0 41.0 41.0 41.0
35.5 35.5 35.5 36.5 36.5 36.5 37.5 37.5 37.5 37.0 37.0 37.0
43.0 43.0 43.0 43.0 43.0 43.0 43.0 43.0 42.5 42.5 42.5 42.0
36.5 36.5 36.0 36.0 36.5 36.5 36.5 36.5 36.5 36.5 27.5 27.5
33.0 33.0 33.0 33.0 33.0 33.0 33.0 32.5 32.5 34.0 34.0 34.0
32.5 32.5 32.5 34.5 34.5 34.5 34.0 34.0 34.0 33.5 33.5 33.5
36.0 36.0 36.0 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5
38.0 38.0 38.0 38.0 38.0 38.0 38.0 38.0 38.0 38.0 38.0 38.0
32.0 30.5 30.5 33.0 33.0 33.0 33.0 33.0 33.0 33.0 33.0 33.0
45.0 45.0 45.5 45.5 45.5 47.0 47.0 47.0 45.0 44.5 44.5 44.0
42.5 42.0 42.0 42.0 41.5 41.5 41.5 40.0 40.0 40.0 40.0 40.0
36.5 36.5 36.5 38.0 38.0 38.0 38.0 38.0 38.0 38.0 38.0 38.0
35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5
39.5 39.5 39.5 39.5 40.0 40.0 40.0 40.0 40.0 40.0 39.0 39.0
29.0 29.0 27.5 28.5 28.5 31.0 31.0 31.0 32.0 32.0 32.0 31.0
38.5 38.5 38.5 39.0 39.0 39.0 39.0 37.0 37.0 37.0 37.5 37.5
Reproduction without permission of the Publisher is strictly forbidden
S-39
International Country Risk Guide
COUNTRY
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Rep.
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua N.G.
Paraguay
Peru
S-40
September 2003
10/02 11/02 12/02 01/03 02/03 03/03 04/03 05/03 06/03 07/03 08/03 09/03
33.0 33.0 32.5 32.5 33.5 33.5 33.5 33.5 33.5 33.5 33.5 33.5
34.0 34.0 34.0 34.0 36.0 36.0 36.0 35.0 35.0 35.0 35.0 35.0
26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0
27.0 27.0 27.0 27.0 27.5 27.5 27.5 27.5 27.5 27.5 27.5 27.5
27.0 27.0 27.0 27.0 27.0 27.0 27.0 27.0 25.5 25.5 25.5 25.5
32.5 32.5 32.5 32.5 32.5 32.5 28.0 28.0 28.0 28.0 28.0 28.0
45.5 45.5 45.5 45.0 45.0 45.0 45.0 44.0 44.0 43.5 43.5 43.5
36.0 36.0 36.0 36.0 36.0 35.0 35.0 35.0 35.0 35.0 35.0 34.5
36.0 36.0 36.0 36.0 36.0 36.0 36.0 36.0 39.0 39.0 39.0 39.0
34.5 34.5 34.5 34.5 34.5 34.5 34.0 34.0 34.0 34.0 34.0 35.0
34.0 34.0 34.0 34.5 34.5 34.5 34.5 36.0 36.0 36.5 36.5 36.5
38.5 38.5 38.5 38.5 38.5 37.5 37.5 37.5 37.5 36.5 36.5 36.5
26.0 26.0 26.0 26.0 26.0 26.0 17.5 17.5 17.5 19.0 19.0 20.0
43.5 43.5 43.5 41.5 41.5 41.5 41.5 41.5 41.5 41.0 41.0 41.0
33.5 33.5 32.5 32.5 32.5 32.5 34.5 34.5 34.5 35.5 35.5 38.0
39.5 39.5 37.5 39.0 39.0 39.5 39.5 39.5 39.0 39.0 39.0 39.0
32.0 32.0 32.0 32.0 31.0 31.0 31.0 29.0 29.0 29.0 32.5 32.5
36.5 36.0 36.0 37.0 37.5 37.5 37.5 37.0 37.0 37.0 37.5 37.5
36.0 36.0 36.0 36.0 36.0 36.0 36.0 36.0 36.0 36.0 36.0 36.0
38.0 37.5 37.5 37.5 36.0 36.0 36.0 37.0 37.0 37.0 37.0 37.0
32.5 32.5 32.5 32.5 33.0 33.0 33.0 32.5 32.5 32.5 32.5 32.5
17.0 17.0 17.5 30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.0
43.5 43.5 43.5 43.5 43.5 43.5 42.0 42.0 41.0 41.0 41.0 40.5
42.5 42.5 42.5 44.0 44.5 46.5 46.5 46.5 46.0 46.0 46.0 47.0
36.5 36.5 36.5 36.5 36.5 36.5 36.5 36.5 38.5 38.5 38.5 38.5
26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0
28.5 28.5 28.5 28.5 28.5 28.5 28.5 28.5 28.5 23.0 23.0 21.0
40.5 41.5 41.5 41.5 42.5 42.0 42.0 42.0 42.0 42.0 41.5 41.5
37.5 37.5 37.5 37.5 37.5 37.5 37.5 37.5 37.5 37.5 37.5 37.5
44.5 44.5 44.5 44.5 44.5 44.5 44.5 44.5 44.5 44.5 44.5 44.5
28.0 28.0 28.0 28.0 28.0 28.0 28.0 28.0 28.0 28.0 28.0 28.0
26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0 26.0
40.5 41.0 41.0 41.0 40.0 40.0 40.0 39.0 39.0 39.0 39.0 39.0
24.0 24.0 24.0 24.0 24.0 24.0 24.0 24.0 24.0 24.0 24.0 24.0
35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5
36.0 36.0 36.5 36.5 38.0 37.5 37.5 37.0 37.0 37.0 37.0 37.0
29.5 29.5 29.5 29.5 29.5 29.5 29.5 29.5 29.5 29.5 29.5 29.5
25.0 25.0 25.0 25.0 25.0 25.0 25.0 25.0 25.0 25.0 25.0 25.0
36.0 36.5 36.5 36.5 36.0 37.0 37.0 37.0 37.0 37.0 37.0 37.0
25.5 25.5 25.5 25.5 25.5 25.5 25.5 25.5 25.5 25.5 25.5 25.5
36.5 36.5 36.5 35.5 35.5 35.5 35.5 32.5 32.5 32.5 32.5 32.5
35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5
41.0 41.0 41.0 38.5 38.5 38.5 38.5 38.5 38.5 41.0 41.0 41.0
39.0 40.5 40.5 40.5 40.5 41.0 41.0 41.0 41.0 41.0 41.5 41.5
25.0 25.0 25.0 23.0 23.0 23.0 23.0 22.5 22.5 22.0 22.0 22.0
31.0 31.0 31.0 31.0 31.0 31.0 31.0 31.0 31.0 31.0 31.0 31.0
29.0 28.5 28.5 28.5 31.0 31.0 31.0 31.0 31.0 31.0 31.0 31.0
47.0 47.0 47.0 47.0 47.0 47.0 46.5 46.5 46.5 46.0 46.0 46.0
42.0 42.0 42.0 42.0 42.0 42.0 42.0 42.0 42.0 42.0 42.0 42.0
34.5 34.5 34.5 35.5 35.5 35.5 35.5 35.5 35.5 37.5 37.5 37.5
35.5 35.5 35.5 35.5 35.5 35.5 36.0 36.0 36.0 35.0 35.0 36.0
30.5 30.5 30.5 32.5 32.5 32.5 31.0 30.5 30.5 30.5 30.5 30.0
30.0 30.0 26.5 29.0 30.0 25.5 25.5 29.0 29.0 29.0 29.0 29.0
36.5 36.5 38.0 38.5 38.0 36.5 36.5 36.5 36.5 36.5 36.5 36.5
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
COUNTRY
Philippines
Poland
Portugal
Qatar
Romania
Russian Fed.
Saudi Arabia
Senegal
Serbia &
Montenegro
Sierra Leone
Singapore
Slovak Rep.
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & T.
Tunisia
Turkey
Uganda
Ukraine
United Arab E.
United K’dom
United States
Uruguay
Venezuela
Vietnam
Yemen, Rep.
Zambia
Zimbabwe
September 2003
10/02 11/02 12/02 01/03 02/03 03/03 04/03 05/03 06/03 07/03 08/03 09/03
37.0 37.0 37.0 36.5 36.5 36.5 36.5 38.0 38.0 35.5 35.5 35.5
34.0 34.0 34.0 35.0 35.0 35.0 35.0 35.0 35.0 35.5 35.5 35.5
36.0 36.0 34.5 34.5 34.5 34.5 36.5 36.5 36.0 36.0 36.0 34.5
47.5 47.5 47.5 47.5 47.5 47.5 47.5 47.5 47.5 47.5 47.5 47.5
31.0 31.0 31.0 31.0 31.0 31.0 33.0 33.0 33.5 33.5 33.5 31.5
38.5 38.5 38.5 38.5 38.0 38.0 38.0 35.0 35.0 35.0 39.5 39.5
34.5 34.5 34.5 40.5 40.5 40.5 41.0 41.0 41.0 41.0 41.0 41.0
35.0 35.0 35.0 35.0 35.0 35.0 35.0 35.0 35.0 35.0 35.0 35.0
23.0
25.5
46.0
35.0
38.0
28.5
36.0
39.5
30.0
33.5
33.0
41.0
44.5
37.5
42.0
34.5
40.0
31.5
39.0
36.0
27.0
33.5
37.0
44.0
40.5
40.5
25.0
27.0
37.0
36.5
23.0
11.5
23.0
25.5
46.0
35.0
38.0
28.5
36.0
39.5
30.0
33.5
33.0
41.0
44.5
37.5
42.0
34.5
40.0
31.5
39.0
36.0
27.0
33.5
37.0
43.5
40.5
40.5
25.0
27.0
37.0
36.5
23.0
11.5
23.0
25.5
46.0
35.0
38.0
28.5
36.0
39.5
30.0
33.5
31.5
41.0
44.5
37.5
42.0
34.5
40.0
31.5
40.0
36.0
27.0
33.5
37.0
43.5
40.5
40.5
25.0
27.0
37.0
36.5
23.0
10.5
22.5
25.5
46.0
34.0
38.0
28.5
36.0
39.5
30.0
33.5
31.5
43.5
44.5
38.0
42.0
34.5
38.0
31.5
40.0
36.5
27.0
33.5
37.0
43.5
40.5
40.5
28.0
34.5
37.0
36.5
23.0
10.5
22.5
25.5
46.0
34.0
38.0
28.5
36.0
39.5
30.0
33.5
23.0
43.5
44.0
38.0
43.0
34.5
38.0
31.5
41.0
36.5
27.0
33.5
37.0
46.0
41.5
40.5
28.0
34.5
37.0
36.5
23.0
10.5
22.5
25.5
46.0
34.0
38.0
28.5
36.0
39.5
30.5
33.5
23.0
43.5
44.0
38.0
43.0
34.5
38.0
31.5
41.0
37.0
27.0
33.5
37.0
46.0
41.5
38.5
28.0
34.5
37.0
36.5
23.0
10.5
22.5
25.5
46.0
34.0
38.0
28.5
36.0
39.5
30.5
34.5
23.0
43.5
44.0
37.5
43.0
34.5
38.0
31.5
41.0
37.0
27.0
33.5
37.5
46.0
41.5
38.5
28.0
34.5
35.5
36.5
23.0
9.5
22.5
25.5
45.0
34.0
38.0
28.5
36.0
39.5
30.5
34.5
30.0
43.0
44.0
37.5
43.0
34.5
39.0
31.5
40.5
37.0
26.5
33.5
37.5
46.0
41.0
38.5
28.0
26.5
35.5
36.5
23.0
9.5
22.5
25.5
45.0
34.0
38.0
28.5
36.5
40.0
31.5
34.5
30.0
43.0
44.0
37.5
43.0
34.5
39.0
31.5
40.5
37.0
26.5
33.5
37.0
46.0
41.0
38.0
29.0
26.5
36.0
36.5
23.0
9.5
Reproduction without permission of the Publisher is strictly forbidden
22.5
25.5
44.5
34.5
38.0
28.5
36.5
39.5
31.5
34.5
30.0
43.0
44.0
37.5
43.0
34.5
40.0
31.5
40.5
36.5
26.5
33.5
37.0
46.0
41.0
38.0
28.5
26.5
36.0
36.5
23.0
9.5
22.5
25.5
44.5
34.5
38.0
28.5
36.5
39.5
31.5
34.5
30.0
43.0
43.5
37.5
43.0
34.5
40.0
31.5
41.0
36.5
26.5
33.5
37.0
46.0
39.0
38.0
28.5
26.5
36.0
36.5
23.0
9.5
22.5
25.5
44.5
35.0
38.0
28.5
35.5
39.0
31.0
34.0
30.0
43.0
43.5
37.5
43.0
34.5
40.0
31.5
41.0
36.5
26.5
33.5
37.5
46.0
39.0
38.0
28.0
26.5
35.5
36.5
23.0
9.5
S-41
International Country Risk Guide
September 2003
TABLE 5B
ECONOMIC RISK POINTS BY COMPONENT – SEPTEMBER 2003
This table lists the risk points awarded to each of the Economic Risk components. The
maximum points available for each component are given in parentheses in the column
heading. The final columns in the table show the overall economic risk rating (the sum of the
points awarded to each component) and the change from the preceding month. Changes in the
points awarded to the individual risk components are shown in Tables 7 through 11.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
S-42
GDP
per head
of
Population
(5)
1.0
1.0
0.0
3.0
0.0
5.0
5.0
0.5
4.0
3.5
0.0
0.5
5.0
0.5
2.0
1.5
4.5
1.0
0.0
0.0
5.0
2.5
0.5
1.0
0.0
0.5
2.5
0.0
2.5
1.5
4.0
3.0
5.0
1.5
0.5
0.5
Current
Annual
Budget
Real
Inflation Balance as Account as
Annual
Rate
percent of percent of
GDP
GDP
(10)
GDP
Growth
(15)
(10)
(10)
9.0
8.5
4.0
9.5
10.0
9.5
8.0
15.0
10.0
0.5
5.5
10.0
8.5
5.0
7.0
13.0
10.0
9.0
7.5
6.0
8.5
9.5
8.0
10.0
6.0
10.0
7.5
11.5
10.0
9.0
7.5
8.0
7.5
9.5
6.5
8.5
9.0
9.5
6.0
10.5
9.5
8.5
5.5
15.0
9.0
4.0
6.5
10.5
6.0
10.0
8.0
13.5
8.0
10.0
4.5
10.0
8.5
7.5
6.5
14.0
7.0
7.0
6.0
11.5
8.5
10.0
6.5
15.0
9.0
9.0
7.0
10.0
8.0
8.5
5.5
7.5
9.0
8.5
8.5
10.5
7.5
9.0
8.0
12.5
8.5
9.5
7.0
11.5
10.0
10.0
6.0
12.0
8.0
8.0
5.0
10.5
9.0
6.0
6.0
9.0
4.5
8.5
4.5
0.0
7.5
8.0
5.5
10.0
6.5
8.5
8.0
11.0
8.5
9.0
4.5
10.5
6.0
9.5
6.0
10.5
8.0
9.5
6.5
13.0
8.0
9.5
6.5
10.0
6.5
9.5
8.0
13.0
3.0
5.0
7.5
10.5
8.0
7.0
8.0
10.5
7.0
8.5
6.5
11.0
Reproduction without permission of the Publisher is strictly forbidden
Economic
Risk
Rating
32.0 0.0
43.5 0.0
26.0 0.0
36.5 0.0
32.5 2.0
41.0 0.0
40.0 0.0
35.0 0.0
36.0 0.0
38.5 0.0
38.5 0.0
30.5 0.0
42.5 -0.5
33.0 0.0
38.5 0.0
33.0 1.5
44.5 0.0
36.0 0.0
29.5 0.0
36.5 0.0
42.0 0.0
39.0 0.0
38.5 0.0
32.5 0.0
30.0 0.0
18.0 -16.5
33.5 -1.0
34.0 0.0
35.0 0.0
33.5 0.0
41.0 0.0
37.0 0.0
42.0 -0.5
27.5 0.0
34.0 0.0
33.5 0.0
International Country Risk Guide
COUNTRY
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
GDP
per head
of
Population
(5)
1.0
2.5
0.0
5.0
5.0
2.5
0.0
5.0
0.0
4.0
1.0
0.5
0.0
0.5
0.0
0.5
5.0
3.0
5.0
0.0
0.5
3.0
0.5
5.0
4.5
5.0
2.0
5.0
0.5
1.0
0.0
0.5
3.5
4.5
2.5
2.5
0.0
2.0
2.0
5.0
0.0
0.0
2.5
0.0
3.5
3.0
0.0
0.0
0.5
September 2003
Current
Annual
Budget
Real
Inflation Balance as Account as
Annual
Rate
percent of percent of
GDP
GDP
(10)
GDP
Growth
(15)
(10)
(10)
8.0
9.5
6.5
10.5
9.0
9.0
8.0
9.5
10.0
10.0
3.5
9.5
7.0
10.0
8.0
14.0
6.5
10.0
6.0
12.5
7.0
9.5
9.0
10.0
10.0
9.0
6.5
10.0
5.5
10.0
6.0
12.5
9.0
6.0
5.5
10.5
8.5
9.5
6.0
9.5
8.0
7.5
7.0
10.0
9.0
8.0
6.5
11.0
10.0
9.0
1.0
6.0
7.0
8.5
4.5
7.0
4.5
5.5
6.0
9.5
4.5
8.0
5.5
9.5
7.5
10.0
6.5
14.5
8.5
8.5
4.5
10.0
7.5
8.5
7.5
10.5
9.5
8.5
5.0
12.0
8.5
7.5
7.0
13.0
9.0
6.5
6.0
12.0
2.0
2.5
2.5
12.5
8.5
8.5
7.5
11.5
6.0
10.0
6.0
11.5
6.0
9.5
6.5
12.0
7.0
7.5
5.0
11.0
6.0
10.0
3.5
13.0
9.5
9.0
5.5
11.5
10.0
8.0
7.5
10.5
7.5
8.5
6.0
10.5
7.0
8.5
2.5
11.5
8.0
8.5
8.5
12.0
8.0
9.5
10.0
15.0
10.0
10.0
6.5
9.5
8.5
9.0
2.0
4.0
3.0
5.0
5.0
8.0
8.5
8.0
9.0
14.0
9.0
9.5
7.0
10.0
8.0
9.5
8.5
13.5
6.5
7.5
4.5
9.5
6.5
4.0
6.0
9.5
8.5
9.5
5.0
13.5
5.5
8.5
2.0
8.0
8.5
9.0
4.5
10.0
7.5
8.5
7.0
11.0
9.0
4.5
6.5
9.5
6.5
7.5
4.0
7.0
9.0
9.5
5.5
12.5
Reproduction without permission of the Publisher is strictly forbidden
Economic
Risk
Rating
35.5 0.0
38.0 0.0
33.0 0.0
44.0 -0.5
40.0 0.0
38.0 0.0
35.5 0.0
39.0 0.0
31.0 -1.0
37.5 0.0
33.5 0.0
35.0 0.0
26.0 0.0
27.5 0.0
25.5 0.0
28.0 0.0
43.5 0.0
34.5 -0.5
39.0 0.0
35.0 1.0
36.5 0.0
36.5 0.0
20.0 1.0
41.0 0.0
38.0 2.5
39.0 0.0
32.5 0.0
37.5 0.0
36.0 0.0
37.0 0.0
32.5 0.0
30.0 0.0
40.5 -0.5
47.0 1.0
38.5 0.0
26.0 0.0
21.0 -2.0
41.5 0.0
37.5 0.0
44.5 0.0
28.0 0.0
26.0 0.0
39.0 0.0
24.0 0.0
35.5 0.0
37.0 0.0
29.5 0.0
25.0 0.0
37.0 0.0
S-43
International Country Risk Guide
COUNTRY
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
S-44
GDP
per head
of
Population
(5)
0.0
3.5
1.0
5.0
4.5
0.0
0.0
0.0
5.0
3.5
0.0
2.0
0.0
0.5
1.0
0.5
2.5
4.0
5.0
1.0
1.5
3.5
0.0
0.5
0.0
5.0
3.0
3.5
0.0
1.5
4.5
0.5
0.0
1.0
5.0
5.0
2.5
4.0
0.0
1.0
0.0
3.0
1.0
1.5
0.0
0.5
5.0
5.0
5.0
September 2003
Current
Annual
Budget
Real
Inflation Balance as Account as
Annual
Rate
percent of percent of
GDP
GDP
(10)
GDP
Growth
(15)
(10)
(10)
10.0
8.0
1.5
6.0
7.5
3.0
7.0
11.5
8.0
7.5
5.5
13.5
6.0
9.5
7.5
13.0
8.0
10.0
8.5
10.5
7.5
8.5
2.5
3.5
9.0
9.0
4.0
9.0
8.5
6.5
5.5
10.5
6.5
9.5
10.0
15.0
7.0
10.0
8.0
13.5
9.0
8.5
6.0
14.0
6.5
10.0
7.0
10.5
5.5
6.5
6.0
12.0
4.0
5.5
6.0
13.0
8.5
9.5
6.5
11.0
8.5
8.5
5.0
13.0
8.0
9.5
5.0
10.5
5.0
9.0
6.5
10.0
10.0
9.5
8.0
15.0
9.0
5.5
6.0
10.0
9.5
6.0
8.5
14.0
8.0
10.0
6.0
13.5
9.5
9.5
6.5
9.5
9.5
1.5
4.5
6.5
9.5
4.0
2.5
9.5
7.0
10.0
7.5
15.0
9.0
7.5
5.5
10.0
8.0
8.5
6.5
11.5
5.5
4.0
8.0
11.0
7.5
8.5
7.0
11.0
7.0
9.0
8.0
10.5
9.5
7.5
3.0
10.5
10.0
7.5
6.5
10.0
7.0
6.0
5.5
10.5
7.0
9.5
8.5
13.0
5.5
10.0
8.0
15.0
7.5
9.5
6.5
11.5
8.5
10.0
6.5
14.0
9.5
8.5
8.0
8.5
9.0
10.0
7.0
13.0
8.5
10.0
5.5
7.5
9.0
8.5
7.5
13.0
9.0
9.5
6.5
10.5
8.5
4.0
2.0
10.5
10.0
8.0
6.5
9.0
9.5
8.0
6.5
13.0
8.5
9.5
8.0
15.0
7.0
9.5
6.5
11.0
7.5
9.5
6.0
10.0
Reproduction without permission of the Publisher is strictly forbidden
Economic
Risk
Rating
25.5 0.0
32.5 0.0
35.5 0.0
41.0 0.0
41.5 0.0
22.0 0.0
31.0 0.0
31.0 0.0
46.0 0.0
42.0 0.0
37.5 0.0
36.0 1.0
30.0 -0.5
29.0 0.0
36.5 0.0
35.5 0.0
35.5 0.0
34.5 -1.5
47.5 0.0
31.5 -2.0
39.5 0.0
41.0 0.0
35.0 0.0
22.5 0.0
25.5 0.0
44.5 0.0
35.0 0.5
38.0 0.0
28.5 0.0
35.5 -1.0
39.0 -0.5
31.0 -0.5
34.0 -0.5
30.0 0.0
43.0 0.0
43.5 0.0
37.5 0.0
43.0 0.0
34.5 0.0
40.0 0.0
31.5 0.0
41.0 0.0
36.5 0.0
26.5 0.0
33.5 0.0
37.5 0.5
46.0 0.0
39.0 0.0
38.0 0.0
International Country Risk Guide
COUNTRY
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
GDP
per head
of
Population
(5)
2.0
2.0
0.0
0.0
0.0
0.0
September 2003
Current
Annual
Budget
Real
Inflation Balance as Account as
Annual
Rate
percent of percent of
GDP
GDP
(10)
GDP
Growth
(15)
(10)
(10)
3.0
5.0
5.5
12.5
0.0
3.5
6.0
15.0
10.0
8.5
6.5
10.5
9.0
6.0
8.0
13.5
8.5
5.0
4.0
5.5
0.0
0.0
0.5
9.0
Reproduction without permission of the Publisher is strictly forbidden
Economic
Risk
Rating
28.0 -0.5
26.5 0.0
35.5 -0.5
36.5 0.0
23.0 0.0
9.5 0.0
S-45
International Country Risk Guide
September 2003
TABLE 5C
ECONOMIC RISK FORECASTS
Country
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
S-46
Current
Rating
32.0
43.5
26.0
36.5
32.5
41.0
40.0
35.0
36.0
38.5
38.5
30.5
42.5
33.0
38.5
33.0
44.5
36.0
29.5
36.5
42.0
39.0
38.5
32.5
30.0
18.0
33.5
34.0
35.0
33.5
41.0
37.0
42.0
27.5
34.0
33.5
35.5
38.0
33.0
44.0
40.0
38.0
35.5
39.0
31.0
37.5
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
30.0
36.0
6.0 28.0
36.0
8.0
42.0
44.0
2.0 40.0
45.0
5.0
18.0
21.0
3.0 18.0
28.0
10.0
29.0
36.0
7.0 33.0
40.0
7.0
30.0
32.0
2.0 28.0
37.0
9.0
37.0
41.0
4.0 35.0
43.0
8.0
38.0
40.0
2.0 37.0
45.0
8.0
33.0
36.0
3.0 30.0
36.0
6.0
35.0
37.0
2.0 30.0
39.0
9.0
37.0
39.0
2.0 36.0
40.0
4.0
37.0
39.0
2.0 30.0
40.0
10.0
23.0
25.0
2.0 20.0
29.0
9.0
40.0
44.0
4.0 38.0
46.0
8.0
30.0
33.0
3.0 28.0
37.0
9.0
36.0
39.0
3.0 36.0
41.0
5.0
25.0
28.0
3.0 30.0
40.0
10.0
39.0
42.0
3.0 35.0
40.0
5.0
35.0
37.0
2.0 30.0
40.0
10.0
30.0
31.5
1.5 28.0
35.0
7.0
35.0
37.0
2.0 30.0
37.0
7.0
37.0
40.0
3.0 36.0
42.0
6.0
36.0
38.0
2.0 33.0
40.0
7.0
38.0
40.0
2.0 33.0
42.0
9.0
30.0
34.0
4.0 28.0
38.0
10.0
28.0
35.0
7.0 24.0
38.0
14.0
27.0
35.0
8.0 25.0
37.0
12.0
32.0
35.0
3.0 30.0
37.0
7.0
37.0
39.0
2.0 35.0
39.0
4.0
36.0
38.0
2.0 33.0
37.0
4.0
29.0
34.0
5.0 25.0
38.0
13.0
35.0
37.0
2.0 30.0
37.0
7.0
30.0
32.0
2.0 30.0
37.0
7.0
41.0
43.0
2.0 35.0
44.0
9.0
25.0
29.0
4.0 25.0
35.0
10.0
25.0
29.0
4.0 23.0
33.0
10.0
34.0
37.0
3.0 30.0
36.0
6.0
37.0
39.0
2.0 30.0
41.0
11.0
36.0
38.0
2.0 30.0
40.0
10.0
28.0
32.0
4.0 28.0
37.0
9.0
39.0
46.0
7.0 35.0
44.0
9.0
39.0
43.0
4.0 35.0
45.0
10.0
40.0
42.0
2.0 36.0
43.0
7.0
32.0
36.0
4.0 27.0
37.0
10.0
38.0
40.0
2.0 34.0
44.0
10.0
30.0
32.0
2.0 27.0
34.0
7.0
37.0
39.0
2.0 35.0
40.0
5.0
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
Country
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Current
Rating
33.5
35.0
26.0
27.5
25.5
28.0
43.5
34.5
39.0
35.0
36.5
36.5
20.0
41.0
38.0
39.0
32.5
37.5
36.0
37.0
32.5
30.0
40.5
47.0
38.5
26.0
21.0
41.5
37.5
44.5
28.0
26.0
39.0
24.0
35.5
37.0
29.5
25.0
37.0
25.5
32.5
35.5
41.0
41.5
22.0
31.0
31.0
46.0
42.0
37.5
36.0
30.0
September 2003
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
32.0
34.0
2.0 30.0
37.0
7.0
33.0
36.0
3.0 28.0
38.0
10.0
25.0
27.0
2.0 25.0
35.0
10.0
27.0
32.0
5.0 27.0
36.0
9.0
22.0
27.0
5.0 22.0
37.0
15.0
25.0
30.0
5.0 25.0
38.0
13.0
34.0
37.0
3.0 30.0
39.0
9.0
31.0
35.0
4.0 32.0
38.0
6.0
40.0
42.0
2.0 35.0
43.0
8.0
29.0
31.0
2.0 28.0
35.0
7.0
20.0
25.0
5.0 28.0
35.0
7.0
25.0
39.0
14.0 28.0
43.0
15.0
20.0
30.0
10.0 20.0
37.0
17.0
40.0
46.0
6.0 38.0
47.0
9.0
30.0
36.0
6.0 30.0
40.0
10.0
36.0
41.0
5.0 35.0
44.0
9.0
30.0
33.0
3.0 28.0
38.0
10.0
35.0
38.0
3.0 35.0
42.0
7.0
35.0
37.0
2.0 30.0
37.0
7.0
35.0
38.0
3.0 30.0
38.0
8.0
32.0
35.0
3.0 28.0
37.0
9.0
7.0
10.0
3.0 10.0
30.0
20.0
30.0
44.0
14.0 28.0
46.0
18.0
38.0
48.0
10.0 30.0
48.0
18.0
36.0
39.0
3.0 38.0
46.0
8.0
20.0
24.0
4.0 20.0
30.0
10.0
22.0
23.0
1.0 20.0
26.0
6.0
40.0
43.5
3.5 38.0
44.5
6.5
39.0
43.0
4.0 35.0
44.0
9.0
44.0
46.0
2.0 38.0
46.0
8.0
34.0
37.0
3.0 30.0
38.0
8.0
23.0
28.0
5.0 23.0
32.0
9.0
38.0
39.5
1.5 33.0
40.0
7.0
30.0
37.0
7.0 30.0
38.0
8.0
35.0
37.0
2.0 33.0
37.0
4.0
35.0
37.5
2.5 30.0
40.0
10.0
17.0
18.0
1.0 20.0
34.0
14.0
27.0
29.0
2.0 23.0
32.0
9.0
36.0
38.0
2.0 30.0
38.0
8.0
23.0
27.0
4.0 20.0
28.0
8.0
25.0
28.0
3.0 25.0
33.0
8.0
34.0
36.5
2.5 32.0
38.0
6.0
42.0
43.0
1.0 37.0
44.0
7.0
40.5
42.5
2.0 38.0
43.0
5.0
18.0
22.0
4.0 22.0
32.0
10.0
32.0
33.0
1.0 28.0
37.0
9.0
28.0
32.0
4.0 23.0
37.0
14.0
43.0
44.0
1.0 38.0
46.0
8.0
30.0
32.0
2.0 30.0
37.0
7.0
31.0
33.0
2.0 28.0
36.0
8.0
34.0
38.0
4.0 30.0
40.0
10.0
29.0
33.0
4.0 28.0
36.0
8.0
Reproduction without permission of the Publisher is strictly forbidden
S-47
International Country Risk Guide
Country
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
S-48
Current
Rating
29.0
36.5
35.5
35.5
34.5
47.5
31.5
39.5
41.0
35.0
22.5
25.5
44.5
35.0
38.0
28.5
35.5
39.0
31.0
34.0
30.0
43.0
43.5
37.5
43.0
34.5
40.0
31.5
41.0
36.5
26.5
33.5
37.5
46.0
39.0
38.0
28.0
26.5
35.5
36.5
23.0
9.5
September 2003
One Year Forecast
Five Year Forecast
Worst
Best
Risk
Worst
Best
Risk
Case
Case Stability Case
Case Stability
27.5
31.0
3.5 25.0
37.0
12.0
35.0
37.5
2.5 30.0
38.0
8.0
31.0
33.0
2.0 28.0
38.0
10.0
34.0
36.0
2.0 30.0
37.0
7.0
34.0
39.0
5.0 32.0
39.0
7.0
22.0
25.0
3.0 22.0
29.0
7.0
27.0
35.0
8.0 25.0
38.0
13.0
37.5
40.5
3.0 30.0
43.0
13.0
29.0
32.0
3.0 29.0
38.0
9.0
35.0
36.0
1.0 30.0
38.0
8.0
20.0
28.0
8.0 20.0
35.0
15.0
20.0
27.0
7.0 25.0
30.0
5.0
35.0
37.0
2.0 26.0
36.0
10.0
30.0
33.0
3.0 30.0
38.0
8.0
30.0
36.0
6.0 30.0
37.0
7.0
20.0
22.0
2.0 18.0
28.0
10.0
30.0
38.0
8.0 28.0
38.0
10.0
38.0
42.0
4.0 37.0
44.0
7.0
28.0
34.0
6.0 28.0
38.0
10.0
27.0
36.0
9.0 25.0
38.0
13.0
28.0
31.0
3.0 28.0
37.0
9.0
44.0
46.0
2.0 37.0
47.0
10.0
42.0
44.0
2.0 38.0
48.0
10.0
37.0
39.0
2.0 34.0
36.0
2.0
40.0
44.0
4.0 35.0
45.0
10.0
30.0
35.0
5.0 27.0
37.0
10.0
33.0
35.0
2.0 28.0
39.0
11.0
30.0
35.0
5.0 30.0
37.0
7.0
40.0
42.0
2.0 38.0
44.0
6.0
34.0
37.0
3.0 30.0
37.0
7.0
28.0
31.0
3.0 28.0
39.0
11.0
35.0
37.0
2.0 30.0
37.0
7.0
33.0
38.0
5.0 30.0
40.0
10.0
45.0
47.0
2.0 38.0
48.0
10.0
37.0
39.0
2.0 36.0
42.0
6.0
36.0
40.0
4.0 36.0
42.0
6.0
27.0
31.0
4.0 26.0
38.0
12.0
26.0
28.0
2.0 23.0
39.0
16.0
33.0
37.0
4.0 30.0
38.0
8.0
33.0
35.0
2.0 30.0
38.0
8.0
26.0
28.0
2.0 23.0
30.0
7.0
10.0
25.0
15.0 25.0
32.0
7.0
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
September 2003
TABLE 6A
SUMMARY OF ECONOMIC RISK COMPONENTS – SEPTEMBER 2003
This table summarizes the economic data on which the Economic Risk Points in Table 5B are based.
For a detailed breakdown of the data, the risk points assigned, and comparison with previous periods,
see the tables indicated in the column headings.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
GDP per Head
of Population
in US$
(Table 7)
1523
1865
737
7072
661
20388
25535
807
12561
10204
336
1491
24099
974
3337
2530
15808
2096
303
578
23512
4348
1013
1898
93
963
4363
526
4742
2313
11368
6910
32761
2374
1434
1187
2195
3819
100
25683
23979
4160
Annual
Real Annual
Current
Budget
GDP Growth, Inflation Rate,
as percentage as percentage Balance, as Account as
percent of
percent of
change on
change on
GDP
GDP
previous year previous year
(Table 11)
(Table 10)
(Table 9)
(Table 8)
4.3
5.3
-7.0
-7.7
6.8
2.9
0.5
12.1
6.0
125.0
-4.0
-5.2
3.5
20.0
-1.9
3.4
10.0
3.5
-0.3
-18.9
3.0
2.7
0.5
-4.3
0.9
1.4
-0.9
-0.2
9.0
3.0
-0.5
-12.8
2.0
2.0
-2.8
-10.9
4.0
2.1
-3.0
-2.7
5.0
5.1
-4.2
0.1
4.0
30.0
-2.0
-2.0
0.9
1.3
0.2
4.9
2.5
1.7
-6.5
-4.0
3.5
8.5
-2.0
7.4
1.6
11.9
-3.8
-0.5
3.8
1.0
0.1
29.7
4.2
3.9
-1.0
-4.8
2.6
4.5
-4.5
-14.2
4.5
4.5
1.5
-3.3
2.4
3.0
0.3
1.9
3.2
2.9
-1.0
-0.2
6.9
0.2
-3.0
0.5
2.8
7.5
-5.0
-2.0
4.2
15.0
-3.0
-9.6
-0.5
4.9
-6.0
-53.6
2.0
7.5
-4.0
-4.9
1.0
4.7
0.5
-1.9
3.5
3.0
-6.6
-2.8
0.5
2.5
-3.8
-2.6
2.5
2.5
-2.2
-3.1
2.7
2.0
-2.2
-4.4
1.3
2.0
0.5
2.4
-2.0
20.3
-0.5
-3.1
2.8
10.5
0.6
-3.1
1.8
5.1
-2.5
-1.0
2.5
2.1
-2.8
-2.7
4.1
3.0
0.0
-6.8
6.0
-2.0
-8.2
-4.9
1.8
1.5
0.2
6.6
1.1
1.6
-3.5
1.8
1.5
2.8
2.0
-5.9
Reproduction without permission of the Publisher is strictly forbidden
S-49
International Country Risk Guide
COUNTRY
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
S-50
GDP per Head
of Population
in US$
(Table 7)
370
24053
313
13710
1942
854
217
1046
369
987
24408
6996
31068
517
791
6324
1166
31686
15231
20428
3128
32481
1363
1795
364
798
10239
17238
3810
5088
174
3244
3542
45644
266
141
4482
206
10091
6224
487
385
1311
208
7719
1780
25807
15448
467
September 2003
Annual
Real Annual
Current
Budget
GDP Growth, Inflation Rate,
as percentage as percentage Balance, as Account as
percent of
percent of
change on
change on
GDP
GDP
previous year previous year
(Table 11)
(Table 10)
(Table 9)
(Table 8)
6.0
3.0
-2.2
-5.0
0.1
0.9
-3.0
1.8
4.7
15.0
-4.5
-2.3
3.7
2.8
-3.2
-6.5
2.5
8.0
-1.0
-4.6
4.0
7.5
-2.9
-1.2
8.2
3.5
-20.9
-18.9
1.9
5.5
-6.5
-16.6
-0.5
18.0
-3.0
-6.4
2.0
7.5
-4.0
-6.7
2.1
-1.5
-2.5
8.4
3.3
5.3
-6.0
-4.3
2.1
5.2
-0.5
-2.0
5.5
4.2
-5.9
0.1
3.4
8.0
-1.5
3.7
4.6
13.0
-3.0
0.8
-3.0
55.0
-10.0
1.4
3.5
4.6
-0.3
-0.5
0.5
1.8
-3.0
-0.5
0.6
2.5
-2.8
0.1
1.5
8.5
-5.0
-1.0
0.9
-0.3
-8.0
2.8
5.1
3.2
-4.1
-0.4
7.8
6.0
-0.4
-2.3
2.0
5.3
-3.0
-2.1
1.8
4.1
-10.0
-0.3
2.7
4.0
1.5
0.2
2.5
2.3
25.0
22.1
6.0
1.5
-2.5
-7.0
3.3
3.5
-14.7
-22.0
-2.0
20.0
-5.0
-12.0
3.0
6.0
2.0
7.6
4.3
2.2
-1.4
-5.8
2.7
2.0
1.0
4.1
1.0
8.0
-6.0
-6.5
1.0
25.0
-3.0
-7.7
3.9
2.2
-5.0
5.6
0.0
4.5
-13.0
-13.0
3.5
3.0
-6.0
-4.5
2.4
4.3
-1.8
-1.9
4.8
23.2
-2.3
-7.0
3.0
8.8
-7.4
-16.7
4.1
2.4
-4.0
1.5
6.0
7.0
-17.7
-18.8
2.0
50.0
-1.0
-0.1
2.8
8.0
-4.0
4.6
0.5
2.5
-0.5
2.9
2.6
1.8
1.3
-3.2
2.2
5.0
-10.0
-23.3
Reproduction without permission of the Publisher is strictly forbidden
International Country Risk Guide
COUNTRY
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
GDP per Head
of Population
in US$
(Table 7)
173
421
42571
8084
406
3552
535
899
2135
1015
5002
12107
31523
2144
2558
9023
494
1442
245
21380
4571
9738
100
2337
15877
912
421
2089
27750
36455
4950
12841
273
2054
302
7278
2219
2661
277
900
26977
26730
35333
3550
3304
452
571
343
327
September 2003
Annual
Real Annual
Current
Budget
GDP Growth, Inflation Rate,
as percentage as percentage Balance, as Account as
percent of
percent of
change on
change on
GDP
GDP
previous year previous year
(Table 11)
(Table 10)
(Table 9)
(Table 8)
4.0
3.4
-7.9
-8.1
3.1
13.5
-4.9
-2.0
1.0
2.5
8.0
11.4
1.7
1.0
0.9
4.9
4.9
4.5
-3.5
6.9
1.3
1.7
-1.5
-2.7
0.2
13.5
-3.0
0.7
-1.2
17.8
-3.5
2.3
3.6
2.8
-2.0
-1.9
3.8
4.0
-5.0
3.5
2.5
1.1
-5.0
-3.8
-0.1
3.0
-2.3
-5.8
6.0
2.5
0.8
12.4
4.8
18.0
-3.0
-4.1
5.1
14.5
1.0
7.1
2.5
1.3
-3.0
5.6
5.0
2.3
-2.6
-6.7
5.0
87.0
-6.0
-17.7
5.0
30.0
-10.0
-6.0
1.8
0.6
-0.9
17.5
4.2
8.4
-4.0
-5.7
2.5
5.8
-2.6
-0.3
0.0
30.0
0.0
-1.0
2.4
5.0
-1.0
-1.0
1.9
3.0
0.2
-3.0
5.1
8.3
-9.0
-2.8
6.0
9.0
-2.0
-5.4
1.9
15.0
-4.9
-2.4
1.5
2.2
1.8
3.6
0.2
0.8
0.3
11.5
2.1
2.7
-2.5
-0.1
3.0
0.5
-2.5
7.7
5.0
5.8
0.8
-11.0
4.1
1.4
-1.5
2.8
3.0
1.0
-4.0
-14.5
4.0
4.0
-0.5
3.6
4.5
2.8
-2.8
-3.1
3.5
26.0
-12.0
-2.5
6.0
6.0
-2.0
-8.0
5.3
7.4
-2.0
3.9
3.8
2.6
0.0
10.2
1.8
2.6
-2.0
-1.3
2.2
2.1
-3.0
-5.2
-2.0
21.0
-4.0
1.2
-12.0
32.0
-3.8
12.4
6.5
4.2
-2.7
-2.7
4.1
15.8
0.4
4.0
3.4
20.5
-7.0
-19.3
-15.5
380.0
-29.0
-9.7
Reproduction without permission of the Publisher is strictly forbidden
S-51
International Country Risk Guide
September 2003
TABLE 6B
SUMMARY OF FINANCIAL RISK COMPONENTS – SEPTEMBER 2003
This table summarizes the financial data on which the Financial Risk Points in Table 4B are
based. For a detailed breakdown of the data, the risk points assigned, and comparison with
previous periods, see the tables indicated in the column headings.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
S-52
Foreign Debt
as percent of
GDP
(Table12)
64.5
45.4
114.0
45.0
46.3
55.0
10.2
22.6
37.0
3.5
35.2
7.5
16.1
47.0
26.0
50.5
2.0
69.8
63.0
67.0
16.0
60.0
13.6
43.0
250.0
195.6
39.8
140.0
49.3
45.7
1.0
33.0
20.4
28.5
75.0
35.0
32.0
13.5
Foreign Debt
Service as
percent of
Exports of
Goods and
Services
(Table 13)
30.0
20.0
12.0
77.0
25.0
10.0
1.9
6.8
5.5
12.0
9.1
12.5
2.8
15.0
3.2
53.3
0.0
18.8
24.8
28.0
3.0
28.0
8.7
20.0
5.0
22.4
12.5
38.0
12.0
40.5
14.0
10.0
14.4
6.0
19.0
12.0
10.0
33.0
Current
Account as
percent of
Exports of
Goods and
Services
(Table 14)
-21.1
33.7
-6.9
23.6
-53.0
-18.8
-0.4
-28.8
-29.0
-4.0
0.7
-14.0
4.2
-14.5
11.9
-2.8
59.9
-7.8
-150.4
-11.3
3.9
-0.7
1.6
-9.4
-41.7
-68.0
-9.8
-3.5
-20.0
-45.3
-4.0
-6.3
4.3
-5.9
-7.7
-4.1
-6.2
-10.0
International
Exchange Rate
Stability
Liquidity
as percent
as Months of
change
Import Cover
(Table 16)
(Table 15)
Reproduction without permission of the Publisher is strictly forbidden
5.6
24.2
0.9
0.0
2.8
3.5
2.1
3.2
3.8
5.0
2.3
0.4
1.0
4.5
30.8
1.7
16.0
5.0
3.2
2.1
2.0
10.0
12.3
10.0
-7.4
-0.2
1.4
4.0
4.3
0.0
5.8
7.1
6.7
-0.2
1.0
2.6
3.5
2.5
14.3
2.6
-65.6
20.7
0.0
17.8
11.5
-0.6
0.0
0.0
-1.0
-12.1
11.5
-5.2
22.8
15.3
5.3
11.6
11.5
11.5
11.5
6.4
-0.1
-2.5
-19.5
11.5
-9.9
11.5
9.5
0.0
9.7
5.4
11.5
-83.6
0.0
-32.6
-0.1
11.5
International Country Risk Guide
COUNTRY
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Foreign Debt
as percent of
GDP
(Table12)
102.3
101.3
23.2
65.0
130.7
13.5
107.3
32.0
18.0
56.0
320.0
212.0
34.0
78.0
20.0
53.7
120.0
21.0
93.0
2.0
501.1
14.4
55.2
7.4
49.0
0.2
78.5
75.0
50.0
100.0
34.3
23.8
27.0
189.0
535.7
25.0
44.8
1.0
92.0
180.4
41.6
114.0
81.0
21.5
66.5
89.4
48.0
91.0
September 2003
Foreign Debt
Service as
percent of
Exports of
Goods and
Services
(Table 13)
22.4
16.1
19.8
12.0
11.9
8.5
18.1
20.0
16.0
19.0
20.0
11.0
8.0
15.0
1.5
17.7
19.0
12.8
30.0
6.7
117.6
3.4
16.3
4.2
18.4
0.1
20.0
15.0
20.4
60.0
10.7
2.7
8.0
8.0
70.0
5.0
13.5
1.0
16.0
20.0
7.1
9.8
12.0
32.0
37.0
13.0
17.0
8.2
Current
Account as
percent of
Exports of
Goods and
Services
(Table 14)
-21.0
14.2
5.2
-10.0
-12.5
4.2
-4.5
-24.9
-21.7
-8.2
-80.0
-15.9
-15.9
-14.6
4.6
-6.2
-25.0
0.5
9.7
10.7
4.7
-0.4
-1.0
0.3
-1.7
19.9
-6.7
-5.0
-6.0
-10.5
0.5
32.7
-19.0
-422.2
-50.0
15.1
-10.5
4.0
-28.4
-22.0
4.9
-30.0
-5.0
-6.5
-10.5
-26.0
3.5
-38.0
International
Exchange Rate
Stability
Liquidity
as percent
as Months of
change
Import Cover
(Table 16)
(Table 15)
Reproduction without permission of the Publisher is strictly forbidden
2.1
3.5
2.4
0.0
5.0
1.9
1.0
3.4
5.2
1.0
0.0
0.5
0.5
4.2
6.0
1.7
1.4
14.0
6.0
6.3
0.0
1.2
9.0
2.6
6.0
15.0
6.0
5.0
3.5
0.0
8.9
14.1
3.4
12.0
0.0
30.0
3.0
1.0
1.0
3.0
5.4
3.2
6.0
3.6
0.5
0.0
11.4
5.5
-1.0
11.5
11.5
11.5
-32.6
11.5
-5.8
11.5
-1.3
-1.2
11.5
0.0
-37.9
-4.4
0.0
5.6
7.8
5.3
7.2
-4.6
0.0
11.5
8.1
11.5
-19.6
4.4
0.0
5.3
2.9
0.0
3.7
0.9
5.0
0.0
-5.2
-12.5
11.5
11.5
8.0
-34.8
0.0
11.5
8.8
-4.6
-3.0
-0.9
9.1
-0.2
S-53
International Country Risk Guide
COUNTRY
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
S-54
Foreign Debt
as percent of
GDP
(Table12)
7.0
6.5
31.0
94.9
280.0
85.0
60.0
0.0
30.0
59.0
57.3
57.5
42.5
48.0
66.0
42.0
56.3
93.0
32.7
42.5
14.0
61.0
56.0
200.0
13.5
56.0
10.0
60.0
31.9
15.1
58.2
164.1
43.6
32.0
0.2
32.0
15.0
425.0
46.0
82.0
16.6
58.7
55.0
57.0
31.0
20.0
5.4
8.6
September 2003
Foreign Debt
Service as
percent of
Exports of
Goods and
Services
(Table 13)
15.0
4.0
5.0
36.9
25.0
36.4
7.0
5.0
10.0
28.9
27.1
15.9
9.0
35.0
13.8
13.8
16.8
23.0
20.6
11.7
5.0
7.2
45.0
56.0
1.5
15.0
10.0
10.0
11.9
20.4
12.7
9.0
9.3
14.5
2.0
4.0
2.0
30.0
16.3
11.0
4.3
17.1
33.5
12.4
5.6
3.5
3.0
26.0
Current
Account as
percent of
Exports of
Goods and
Services
(Table 14)
-9.6
10.9
4.0
-8.9
-35.3
-57.1
-5.1
23.7
8.3
25.3
-3.2
0.9
3.5
-9.8
5.8
-11.6
-14.5
20.7
-10.0
20.0
11.3
-10.0
-58.0
-100.0
8.7
-7.4
-9.0
-1.0
-2.9
-8.8
-6.1
-22.6
-3.5
6.8
16.7
-1.0
12.9
-75.0
4.2
-12.0
7.2
-6.1
-7.6
-20.0
6.3
15.2
-3.4
-42.3
International
Exchange Rate
Stability
Liquidity
as percent
as Months of
change
Import Cover
(Table 16)
(Table 15)
Reproduction without permission of the Publisher is strictly forbidden
0.0
2.5
1.5
2.6
0.0
0.0
6.5
7.0
5.5
6.0
1.5
-0.2
2.3
13.0
1.6
6.0
4.6
2.5
5.0
7.0
7.5
1.0
0.0
0.0
8.0
5.0
3.7
0.0
2.1
2.8
2.6
-13.0
1.0
3.0
7.0
0.0
18.0
0.8
5.0
1.4
6.6
2.9
0.0
2.3
1.5
5.0
1.1
0.8
3.9
31.0
11.5
20.5
-5.1
11.5
-1.3
0.3
0.0
2.3
0.0
15.3
2.9
4.2
-5.4
5.2
11.5
0.0
-0.4
4.2
0.0
11.5
5.6
-15.0
1.9
13.2
8.8
0.0
31.0
11.5
-0.6
-1.0
-15.4
9.9
6.8
5.8
1.6
-6.7
4.0
11.5
-1.3
6.3
15.9
-10.3
0.0
0.0
2.1
-13.0
International Country Risk Guide
COUNTRY
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
Foreign Debt
as percent of
GDP
(Table12)
85.3
33.0
37.9
66.8
172.9
124.9
September 2003
Foreign Debt
Service as
percent of
Exports of
Goods and
Services
(Table 13)
48.6
18.8
13.7
27.0
13.9
5.4
Current
Account as
percent of
Exports of
Goods and
Services
(Table 14)
4.2
31.8
-4.6
2.0
-63.6
-21.1
International
Exchange Rate
Stability
Liquidity
as percent
as Months of
change
Import Cover
(Table 16)
(Table 15)
Reproduction without permission of the Publisher is strictly forbidden
-10.9
8.0
2.2
1.7
0.0
-1.5
2.9
-9.3
-1.2
-0.9
-4.4
-1386.0
S-55
International Country Risk Guide
September 2003
TABLE 7
GDP PER HEAD OF POPULATION
This table shows the estimated annual GDP per head of population for the current month and
for the preceding five years in US dollars. Risk points are awarded on the basis of the share of
the national GDP per head as a percentage of the current average GDP per head of all the
countries covered. The final column in the table shows the risk points assessed for the current
estimated GDP per head and the change, if any, from the previous month’s risk points.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
S-56
1998
807
1621
519
8277
499
19379
26141
491
12227
9636
324
1436
24524
1069
3038
4867
14879
1542
235
654
20089
5356
761
2413
128
684
3992
747
4834
2021
11961
5536
32532
1957
1620
1338
1990
3587
106
25054
1999
1175
1612
477
7751
523
20682
25946
571
12950
9854
333
1211
24568
1018
2888
3245
15000
1579
212
671
21518
4864
790
2075
260
802
4401
707
4504
2146
11577
5353
32480
2087
1103
1416
2026
3611
96
24710
2000
1199
1749
675
7675
547
19821
23553
655
12945
9812
331
1042
22210
1004
2964
3588
14770
1585
213
623
23307
4965
846
1979
301
1066
4167
571
4234
2222
10905
5007
29674
2333
1101
1435
2091
3398
98
23172
2001
1306
1774
664
7419
589
18351
23457
705
12687
10056
324
1239
22143
964
3168
2952
14613
1728
221
580
22688
4315
927
1909
143
961
4233
544
4441
2293
11068
5558
29874
2501
1329
1187
2147
3558
98
23403
2002
1490
1746
715
8838
623
20131
25308
745
12561
10135
327
1433
23907
950
3244
2553
15808
1997
240
565
23190
4264
955
1866
92
997
4320
536
4582
2311
11263
6742
32340
2458
1420
1196
2183
3669
98
25279
Current Percent of
Average
09/03
1523
20.2
1865
24.7
737
9.8
7072
93.7
661
8.7
20388
270.0
25535
338.2
807
10.7
12561
166.4
10204
135.1
336
4.5
1491
19.7
24099
319.2
974
12.9
3337
44.2
2530
33.5
16564
219.4
2096
27.8
303
4.0
578
7.7
23512
311.4
4348
57.6
1013
13.4
1898
25.1
93
1.2
963
12.7
4363
57.8
526
7.0
4742
62.8
2313
30.6
11368
150.5
6910
91.5
32761
433.9
2374
31.4
1434
19.0
1187
15.7
2195
29.1
3819
50.6
100
1.3
25683
340.1
Reproduction without permission of the Publisher is strictly forbidden
Current
Risk
Points
1.0 0.0
1.0 0.0
0.0 0.0
3.0 0.0
0.0 0.0
5.0 0.0
5.0 0.0
0.5 0.0
4.0 0.0
3.5 0.0
0.0 0.0
0.5 0.0
5.0 0.0
0.5 0.0
2.0 0.0
1.5 0.5
4.5 0.0
1.0 0.0
0.0 0.0
0.0 0.0
5.0 0.0
2.5 0.0
0.5 0.0
1.0 0.0
0.0 0.0
0.5 0.0
2.5 0.0
0.0 0.0
2.5 0.0
1.5 0.0
4.0 0.0
3.0 0.0
5.0 0.0
1.5 0.0
0.5 0.0
0.5 0.0
1.0 0.0
2.5 0.0
0.0 0.0
5.0 0.0
International Country Risk Guide
September 2003
COUNTRY
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
1998
24666
3896
288
26115
404
11593
1795
663
177
935
492
851
25271
4654
29625
435
467
3038
2185
23357
17223
20777
2922
31171
1157
1401
390
765
6829
12365
2484
2710
150
5597
2905
42650
248
252
3254
246
9238
4356
529
445
1289
213
5464
2309
24085
14251
431
167
1999
24404
3907
311
25548
408
11878
1652
670
183
883
524
848
24298
4771
29948
454
675
3969
2157
25493
16902
20468
2941
35478
1149
1176
351
677
8666
13848
2741
3330
137
5907
2914
45838
240
178
3485
242
9347
4897
358
405
1248
230
7396
2043
25186
14559
447
206
2000
22175
4190
323
22767
272
11321
1694
692
186
909
460
938
24786
4659
29905
467
723
5163
2142
25026
18111
18614
2932
37559
1167
1230
341
682
9761
16890
2941
3555
181
6089
3077
43134
249
167
3875
217
9141
5793
396
345
1161
233
7443
2014
23322
13206
479
194
2001
22119
4306
338
22494
269
11685
1795
790
194
974
431
973
24405
5225
27281
478
676
5883
2146
26667
17330
18832
2992
32522
1203
1439
364
716
9025
17355
3120
4985
173
4991
3256
44409
274
161
3888
216
9263
6132
442
366
1161
218
7570
1982
23934
13106
491
167
2002
23813
4197
347
24077
305
13234
1943
833
206
1027
380
973
24072
6705
30446
497
782
6131
2107
31008
15537
20367
3082
32320
1327
1657
364
760
10059
17314
3265
5000
178
3219
3396
45514
269
146
4314
211
9738
6170
473
379
1280
200
7666
1771
25883
15132
470
173
Current Percent of
09/03
Average
23979
317.6
4160
55.1
370
4.9
24053
318.5
313
4.1
13710
181.6
1942
25.7
854
11.3
217
2.9
1046
13.9
369
4.9
987
13.1
24408
323.3
6996
92.6
31068
411.4
517
6.8
791
10.5
6324
83.8
1166
15.4
31686
419.6
15231
201.7
20428
270.5
3128
41.4
32481
430.2
1363
18.1
1795
23.8
364
4.8
798
10.6
10239
135.6
17238
228.3
3810
50.5
5088
67.4
174
2.3
3244
43.0
3542
46.9
45644
604.5
266
3.5
141
1.9
4482
59.4
206
2.7
10091
133.6
6224
82.4
487
6.4
385
5.1
1311
17.4
208
2.8
7719
102.2
1780
23.6
25807
341.8
15448
204.6
467
6.2
173
2.3
Reproduction without permission of the Publisher is strictly forbidden
Current
Risk
Points
5.0 0.0
2.5 0.0
0.0 0.0
5.0 0.0
0.0 0.0
4.0 0.0
1.0 0.0
0.5 0.0
0.0 0.0
0.5 0.0
0.0 0.0
0.5 0.0
5.0 0.0
3.0 0.0
5.0 0.0
0.0 0.0
0.5 0.0
3.0 0.0
0.5 -0.5
5.0 0.0
4.5 0.0
5.0 0.0
2.0 0.0
5.0 0.0
0.5 0.0
1.0 0.0
0.0 0.0
0.5 0.0
3.5 0.0
4.5 0.0
2.5 0.0
2.5 0.0
0.0 0.0
2.0 0.0
2.0 0.0
5.0 0.0
0.0 0.0
0.0 0.0
2.5 0.0
0.0 0.0
3.5 0.0
3.0 0.0
0.0 0.0
0.0 0.0
0.5 0.0
0.0 0.0
3.5 0.0
1.0 0.0
5.0 0.0
4.5 0.0
0.0 0.0
0.0 0.0
S-57
International Country Risk Guide
September 2003
COUNTRY
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
Average
S-58
1998
435
33871
6153
453
3707
822
1648
2292
867
4119
10718
18991
1872
1896
7711
501
1500
188
20972
4082
9892
100
3173
14935
841
364
2000
28054
36859
4514
12200
257
1829
322
4772
2123
3160
330
829
16716
24018
32488
6799
4089
358
344
332
500
6950
1999
325
35448
6386
445
3754
736
1444
2047
1019
4012
11633
21780
1585
1330
8099
512
1500
145
20922
3741
10086
100
3045
15264
822
325
2047
28395
36278
4529
13026
261
1992
315
5054
2199
2873
299
614
18687
24543
34010
6317
4357
372
380
324
429
7133
2000
418
37171
8279
427
3904
707
1404
2085
981
4241
10638
29409
1650
1785
9051
462
1400
144
22148
3656
8354
100
2929
14221
843
354
1932
27032
33484
4895
13874
264
1967
269
6256
2036
2957
278
631
26912
24202
35692
6012
5017
404
420
332
435
7180
2001
438
37643
8139
381
3864
589
1215
2057
925
4737
10985
28540
1793
2146
8868
465
1442
163
20547
3789
8877
100
2576
14482
820
376
1881
24852
33996
4873
12551
262
1833
295
6885
2069
2122
271
774
26117
24034
35401
5524
5124
416
353
346
356
7112
2002
414
42336
8108
408
3567
545
933
2102
988
4880
12131
29739
2043
2417
8882
480
1442
231
21053
4387
9499
100
2317
15893
868
406
2050
27340
36674
4969
12517
267
1991
297
7107
2148
2617
268
851
26379
26284
35436
3645
3825
432
357
332
384
7472
Current Percent of
09/03
Average
421
5.6
42571
563.8
8084
107.1
406
5.4
3552
47.0
535
7.1
899
11.9
2135
28.3
1015
13.4
5002
66.3
12107
160.3
31523
417.5
2144
28.4
2558
33.9
9023
119.5
494
6.5
1442
19.1
245
3.2
21380
283.2
4571
60.5
9738
129.0
100
1.3
2337
31.0
15877
210.3
912
12.1
421
5.6
2089
27.7
27750
367.5
36455
482.8
4950
65.6
12841
170.1
273
3.6
2054
27.2
302
4.0
7278
96.4
2219
29.4
2661
35.2
277
3.7
900
11.9
26977
357.3
26730
354.0
35333
467.9
3550
47.0
3304
43.8
452
6.0
571
7.6
343
4.5
327
4.3
7551
Reproduction without permission of the Publisher is strictly forbidden
Current
Risk
Points
0.0 0.0
5.0 0.0
3.5 0.0
0.0 0.0
2.0 0.0
0.0 0.0
0.5 0.0
1.0 0.0
0.5 0.0
2.5 0.0
4.0 0.0
5.0 0.0
1.0 0.0
1.5 0.0
3.5 0.0
0.0 0.0
0.5 0.0
0.0 0.0
5.0 0.0
3.0 0.5
3.5 0.0
0.0 0.0
1.5 0.0
4.5 0.0
0.5 0.0
0.0 0.0
1.0 0.0
5.0 0.0
5.0 0.0
2.5 0.0
4.0 0.0
0.0 0.0
1.0 0.0
0.0 0.0
3.0 0.0
1.0 0.0
1.5 0.0
0.0 0.0
0.5 0.0
5.0 0.0
5.0 0.0
5.0 0.0
2.0 0.0
2.0 0.0
0.0 0.0
0.0 0.0
0.0 0.0
0.0 0.0
International Country Risk Guide
September 2003
TABLE 8
REAL GDP GROWTH
This table shows the estimated annual GDP growth at constant 1990 prices for the current
month and for the preceding five years. Risk points are awarded in proportion to the rate of
growth as outlined in the Guide to ICRG. The final column in the table shows the risk points
assessed for the current estimated real GDP growth and the change, if any, from the previous
month’s risk points.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
1998
8.0
5.1
5.5
3.9
7.3
5.3
3.2
10.0
3.0
4.8
5.2
8.4
2.0
5.0
8.1
0.2
2.0
3.5
5.5
5.0
3.6
9.9
7.8
0.6
-1.8
3.8
8.5
5.8
2.5
1.3
5.0
-1.1
2.5
7.4
0.5
4.5
3.8
5.0
-1.4
1999
7.3
3.2
2.7
-3.4
3.3
4.7
3.7
7.4
5.9
2.3
4.9
3.4
3.2
0.4
4.1
0.8
2.5
2.5
6.4
4.4
4.6
-0.9
7.2
-4.2
-4.2
-3.2
8.2
1.6
-0.4
6.2
4.5
0.5
2.6
8.0
-7.3
6.3
3.5
-0.7
6.0
2000
7.8
2.4
3.5
-0.8
6.0
8.0
3.5
11.1
4.9
4.0
5.9
5.8
3.7
2.4
7.7
4.4
3.0
4.0
1.6
4.2
4.7
4.4
8.0
2.9
-6.9
8.1
1.8
-2.3
3.7
5.5
4.8
3.2
2.9
7.4
2.3
5.1
2.2
6.9
5.4
2001
6.5
2.1
5.2
-4.4
6.5
2.3
0.7
9.9
-2.0
4.0
5.3
4.7
0.8
1.2
8.9
4.4
2.7
4.0
4.6
5.3
1.5
2.8
7.3
1.3
0.9
3.6
1.1
-0.9
4.1
2.5
3.4
3.1
1.5
3.2
5.6
3.5
1.8
5.4
7.7
2002
4.7
2.3
8.5
-11.0
6.0
3.8
1.0
10.6
0.7
4.0
4.8
4.7
0.6
2.8
2.3
1.5
3.8
4.8
4.6
4.4
3.4
2.4
8.0
1.5
3.0
3.5
2.7
0.0
3.5
1.1
2.5
2.0
1.6
4.2
3.0
2.9
2.1
4.1
5.0
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
4.3
6.8
6.0
3.5
10.0
3.0
0.9
9.0
2.0
4.0
5.0
4.0
0.9
2.5
3.5
1.6
3.9
4.2
2.6
4.5
2.4
3.2
6.9
2.8
4.2
-0.5
2.0
1.0
3.5
0.5
2.5
2.7
1.3
-2.0
2.8
1.8
2.5
4.1
6.0
Current
Risk
Points
9.0 0.0
10.0 0.0
10.0 0.0
8.5 0.0
10.0 0.0
8.5 0.0
6.0 0.0
10.0 0.0
7.5 0.0
9.0 0.0
9.5 0.0
9.0 0.0
6.0 -0.5
8.0 0.0
8.5 0.0
7.0 -0.5
8.5 0.0
9.0 0.0
8.0 0.0
9.0 0.0
7.5 0.0
8.5 0.0
10.0 0.0
8.0 0.0
9.0 0.0
4.5 0.0
7.5 0.0
6.5 0.0
8.5 0.0
6.0 0.0
8.0 0.0
8.0 0.0
6.5 -0.5
3.0 0.0
8.0 0.0
7.0 0.0
8.0 0.0
9.0 0.0
10.0 0.0
S-59
International Country Risk Guide
September 2003
COUNTRY
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
S-60
1998
5.3
3.5
3.5
3.5
1.9
4.7
3.3
5.0
4.5
-28.1
-1.7
2.2
2.9
-4.9
4.8
5.0
6.0
-13.1
3.8
1.5
8.8
3.0
1.8
-0.3
-1.0
3.0
-1.9
0.8
-7.0
-6.7
3.1
4.8
7.3
28.5
-1.0
5.1
5.8
3.9
6.6
-7.4
4.9
3.4
5.0
-6.5
4.0
7.7
11.3
5.8
4.2
3.6
-0.4
4.1
1999
3.6
3.1
-9.6
6.4
2.1
4.4
3.6
3.9
3.9
7.8
3.0
2.7
-1.9
3.4
4.2
3.6
7.1
0.7
1.7
1.0
11.1
2.7
1.6
-0.4
0.8
3.1
2.7
1.4
6.2
10.9
-1.7
2.8
8.8
22.9
0.7
-3.9
6.0
4.7
2.6
6.1
6.6
4.1
3.6
-3.4
3.5
-0.1
11.9
10.9
3.3
3.9
4.1
7.4
2000
5.6
3.7
-1.9
5.6
2.8
3.7
4.1
3.6
1.8
9.3
-1.4
0.9
5.7
10.2
5.2
5.5
4.0
5.0
5.1
2.0
10.0
7.4
3.2
0.6
2.3
4.0
9.8
-0.2
1.3
9.3
3.9
6.6
9.0
22.4
4.4
3.3
7.5
4.8
4.0
8.4
4.3
3.5
6.5
2.1
3.2
1.0
7.3
6.2
3.4
3.3
2.0
5.9
2001
0.6
1.8
1.5
6.0
0.6
4.2
4.1
2.3
3.5
8.5
1.4
-1.2
2.6
0.6
3.8
3.0
5.5
3.3
5.0
2.3
5.7
-0.9
1.8
1.8
0.4
4.2
13.5
1.2
3.7
3.1
-1.1
7.9
-1.6
4.9
0.6
3.6
3.5
6.0
3.2
0.4
-1.2
3.5
-0.2
6.1
1.1
6.4
3.8
4.8
3.3
1.3
4.4
3.1
2002
1.6
1.6
1.0
6.0
0.2
4.5
4.0
2.3
3.8
8.2
1.9
-0.9
2.6
2.3
3.3
-0.5
4.4
3.7
5.8
-3.0
6.3
-1.0
0.4
1.0
0.1
5.1
9.5
0.9
3.2
6.4
-0.7
6.1
1.6
3.3
2.0
4.3
2.7
1.0
3.0
4.1
0.0
3.5
0.7
4.8
1.4
4.5
8.0
4.2
2.7
0.2
4.8
1.0
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
1.8
1.1
1.5
6.0
0.1
4.7
3.7
2.5
4.0
8.2
1.9
-0.5
2.0
2.1
3.3
2.1
5.5
3.4
4.6
-3.0
3.5
0.5
0.6
1.5
0.9
5.1
7.8
2.0
1.8
2.7
2.5
6.0
3.3
-2.0
3.0
4.3
2.7
1.0
1.0
3.9
0.0
3.5
2.4
4.8
3.0
4.1
6.0
2.0
2.8
0.5
2.6
2.2
Current
Risk
Points
7.0 -1.0
6.5 0.0
7.0 0.0
10.0 0.0
5.5 0.0
9.0 0.0
8.5 0.0
8.0 0.0
9.0 0.0
10.0 0.0
7.0 0.0
4.5 0.0
4.5 0.0
7.5 0.0
8.5 -0.5
7.5 0.0
9.5 0.0
8.5 0.0
9.0 0.0
2.0 0.0
8.5 0.0
6.0 1.0
6.0 -0.5
7.0 0.0
6.0 0.0
9.5 0.0
10.0 0.0
7.5 0.0
7.0 0.0
8.0 -1.0
8.0 0.5
10.0 0.0
8.5 0.0
3.0 -2.0
8.5 0.0
9.0 0.0
8.0 0.0
6.5 0.0
6.5 0.0
8.5 0.0
5.5 0.0
8.5 0.0
7.5 0.0
9.0 0.0
6.5 0.0
9.0 0.0
10.0 0.0
7.5 0.0
8.0 0.0
6.0 0.0
8.0 0.0
7.5 0.0
International Country Risk Guide
September 2003
COUNTRY
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
1998
2.4
2.3
2.6
2.7
2.6
8.7
-1.1
-0.4
-0.5
-0.5
4.9
4.6
6.2
-4.8
-4.9
2.9
5.7
1.9
-6.6
-0.2
3.9
3.8
0.0
0.7
3.9
4.7
5.0
4.1
3.6
2.4
7.6
4.3
3.5
-10.4
-2.1
7.8
4.8
3.0
5.4
-1.9
1.4
2.9
4.3
4.5
-0.1
5.7
4.9
-2.0
2.9
1999
10.4
2.7
2.2
-0.3
3.6
4.3
4.7
0.5
1.0
3.4
4.0
3.8
5.3
-1.2
5.4
-0.8
5.1
-15.7
0.1
6.9
1.4
5.2
0.0
2.0
4.8
4.3
6.9
-4.8
4.7
1.5
-2.0
5.6
-4.6
4.4
2.7
4.4
6.0
-4.7
7.8
-0.4
4.4
2.4
4.1
-2.8
-6.0
4.7
3.7
2.4
-0.7
2000
-0.6
3.6
2.8
5.5
4.3
3.3
-1.3
-0.4
3.1
3.9
4.0
3.7
11.6
2.2
9.0
4.9
5.5
5.0
-11.6
10.8
2.2
4.6
0.0
3.5
4.2
6.1
6.9
-5.7
4.4
3.2
0.6
6.4
4.7
4.6
-0.5
6.1
4.7
7.2
7.0
5.9
12.3
3.0
3.7
-1.4
3.2
6.8
5.1
4.0
-4.9
2001
-1.4
4.2
1.9
9.3
2.7
0.4
-3.4
2.7
0.5
3.4
1.0
1.7
7.2
5.6
5.0
1.2
5.6
5.0
3.8
-2.3
3.3
3.1
0.0
2.8
2.7
-1.5
5.3
1.3
1.1
0.9
2.0
-1.6
5.1
1.9
3.0
3.3
4.8
-7.3
7.0
9.2
3.5
2.2
0.2
-3.3
2.8
6.9
3.3
4.9
-8.4
2002
5.1
2.8
1.1
1.8
4.4
0.7
-3.1
-4.4
5.3
4.6
1.3
0.4
6.0
4.9
4.3
0.7
5.0
5.0
5.0
2.2
4.4
2.5
0.0
3.0
2.0
2.9
5.0
1.2
1.9
0.1
2.2
4.1
5.0
5.2
3.0
2.7
1.7
7.8
6.0
4.8
1.8
1.8
2.5
-10.8
-8.9
7.0
4.1
3.0
-13.5
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
4.0
3.1
1.0
1.7
4.9
1.3
0.2
-1.2
3.6
3.8
2.5
-0.1
6.0
4.8
5.1
2.5
5.0
5.0
5.0
1.8
4.2
2.5
0.0
2.4
1.9
5.1
6.0
1.9
1.5
0.2
2.1
3.0
5.0
4.1
3.0
4.0
4.5
3.5
6.0
5.3
3.8
1.8
2.2
-2.0
-12.0
6.5
4.1
3.4
-15.5
Current
Risk
Points
9.0 0.0
8.5 0.0
6.5 0.0
7.0 0.0
9.0 0.0
6.5 0.0
5.5 -0.5
4.0 0.0
8.5 0.0
8.5 0.0
8.0 0.0
5.0 -1.0
10.0 0.0
9.0 -0.5
9.5 0.0
8.0 0.0
9.5 0.0
9.5 0.0
9.5 0.0
7.0 0.0
9.0 0.0
8.0 0.0
5.5 0.0
7.5 -1.0
7.0 -0.5
9.5 0.0
10.0 0.0
7.0 0.0
7.0 0.0
5.5 0.0
7.5 0.0
8.5 0.0
9.5 0.0
9.0 0.0
8.5 0.0
9.0 0.0
9.0 0.0
8.5 0.0
10.0 0.0
9.5 0.5
8.5 0.0
7.0 0.0
7.5 0.0
3.0 0.0
0.0 0.0
10.0 0.0
9.0 0.0
8.5 0.0
0.0 0.0
S-61
International Country Risk Guide
September 2003
TABLE 9
ANNUAL INFLATION RATE
This table shows the estimated annual inflation rate for the current month and for the preceding
five years as an unweighted average of the Consumer Price Index. Risk points are awarded in
proportion to the rate of inflation as outlined in the Guide to ICRG. The final columns in the
table show the risk points assessed for the current estimated annual inflation rate and the
change, if any, from the preceding month’s risk points.
Country
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
S-62
1998
20.9
5.0
107.2
0.9
8.7
0.8
0.9
-0.7
1.3
-0.4
6.9
72.9
1.0
7.7
6.7
3.2
-3.0
18.7
5.0
3.2
1.0
5.3
-0.8
30.7
29.1
13.1
1.1
4.5
5.4
2.9
2.2
10.7
1.8
4.5
36.1
4.2
2.5
8.1
2.6
1.4
1999
0.4
2.6
248.2
-1.2
0.7
1.5
0.6
-8.6
1.3
1.5
8.9
251.2
1.1
2.1
7.7
4.9
-6.7
2.5
-1.1
1.5
1.7
3.3
-1.4
10.9
284.9
1.1
5.4
0.7
4.4
-2.9
1.7
2.1
2.4
6.4
52.3
3.1
0.5
3.3
7.9
1.2
2000
0.0
0.3
325.0
-0.9
-0.8
4.5
2.4
1.8
1.6
1.5
4.0
107.5
2.5
4.6
8.7
7.1
-0.6
10.3
-0.3
-2.1
2.7
3.8
0.3
9.2
513.9
5.4
-0.8
2.4
7.4
-3.0
5.0
3.9
2.9
7.7
96.1
2.7
2.3
4.0
0.7
3.4
2001
3.1
4.2
152.6
-1.1
4.5
4.4
2.6
1.5
2.0
2.5
1.1
46.1
2.5
1.5
6.6
6.8
2.3
7.4
4.9
4.6
2.6
3.6
0.5
8.0
359.9
-0.8
0.1
4.3
2.6
0.5
4.5
4.7
2.3
8.9
37.7
2.3
3.8
3.5
-8.1
2.5
2002
5.6
1.4
110.0
25.9
4.5
3.0
1.8
2.5
2.0
2.1
4.9
34.8
1.6
0.9
8.1
8.4
1.0
5.8
2.3
2.7
2.2
2.5
-0.4
6.3
31.5
5.8
4.3
3.1
3.0
2.5
2.5
1.8
2.4
10.0
12.5
2.7
1.8
3.0
-5.0
1.6
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
5.3
2.9
125.0
20.0
3.5
2.7
1.4
3.0
2.0
2.1
5.1
30.0
1.3
1.7
8.5
11.9
1.0
3.9
4.5
4.5
3.0
2.9
0.2
7.5
15.0
4.9
7.5
4.7
3.0
2.5
2.5
2.0
2.0
20.3
10.5
5.1
2.1
3.0
-2.0
1.5
Current
Risk
Points
8.5 0.0
9.5 0.0
0.5 0.0
5.0 0.0
9.0 0.5
9.5 0.0
10.0 0.0
9.0 0.0
9.5 0.0
9.5 0.0
8.5 0.0
4.0 0.0
10.0 0.0
10.0 0.0
7.5 0.0
7.0 0.5
10.0 0.0
9.0 0.0
8.5 0.0
8.5 0.0
9.0 0.0
9.5 0.0
10.0 0.0
8.0 0.0
6.0 0.0
8.5 0.0
8.0 -1.0
8.5 0.0
9.0 0.0
9.5 0.0
9.5 0.0
9.5 0.0
9.5 0.0
5.0 0.0
7.0 0.0
8.5 0.0
9.5 0.0
9.0 0.0
10.0 0.0
10.0 0.5
International Country Risk Guide
September 2003
Country
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
1998
0.7
2.3
1.1
1.0
14.6
4.7
7.0
5.1
8.0
4.6
10.6
13.7
2.8
14.2
1.7
13.2
57.7
17.8
50.0
2.4
5.4
2.0
8.7
0.7
3.1
7.1
6.8
30.0
7.5
0.2
4.7
10.0
20.0
24.2
5.1
1.0
6.2
9.1
5.3
4.1
2.4
15.9
7.7
36.6
2.9
5.5
51.5
8.8
2.0
1.3
13.0
2.9
1999
0.6
-0.7
3.8
0.6
12.4
2.7
4.9
4.6
-2.1
7.5
8.7
11.6
-4.0
10.0
3.4
4.7
20.3
20.1
40.0
1.6
5.2
1.7
5.9
-0.3
0.6
8.3
5.7
-0.1
0.8
3.0
2.4
8.0
2.0
2.6
0.8
1.0
9.9
29.7
2.8
-1.2
2.1
16.6
13.8
9.4
0.7
0.6
18.4
6.2
2.2
-0.1
11.2
4.5
2000
1.7
0.5
0.9
2.0
25.2
3.1
6.0
6.8
9.1
6.2
13.7
11.1
-3.8
9.8
5.0
4.0
4.5
14.5
40.0
5.6
1.2
2.5
8.2
-0.7
0.7
13.2
10.0
9.7
2.3
1.9
2.7
12.0
5.3
-2.9
1.0
3.2
11.9
44.9
1.6
-0.7
3.3
9.5
17.8
7.6
1.9
3.1
-0.1
8.6
2.6
2.6
11.5
-2.3
2001
1.6
2.1
4.0
2.4
32.9
3.4
7.6
7.0
2.2
2.6
14.2
9.7
-1.6
9.2
6.7
3.7
12.0
11.3
38.0
4.9
1.1
2.7
7.0
-0.7
1.8
8.3
5.7
2.5
4.0
1.6
2.3
1.5
12.1
-8.5
0.6
2.7
5.0
30.7
1.4
4.5
3.0
6.3
20.8
11.6
0.6
12.3
21.1
9.3
4.5
2.7
7.3
2.9
2002
1.9
2.7
3.0
1.3
14.8
3.6
8.1
7.0
3.5
6.1
9.9
7.7
-3.0
5.3
5.2
4.4
11.4
14.3
40.0
4.7
5.6
2.5
7.1
-1.0
3.2
5.9
1.9
4.1
2.8
1.3
3.0
3.0
14.2
5.0
2.2
2.0
8.0
20.0
1.9
4.5
3.0
5.1
23.2
8.8
2.8
7.0
57.1
9.3
3.5
2.6
4.0
3.9
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
1.6
2.8
3.0
0.9
15.0
2.8
8.0
7.5
3.5
5.5
18.0
7.5
-1.5
5.3
5.2
4.2
8.0
13.0
55.0
4.6
1.8
2.5
8.5
-0.3
3.2
6.0
5.3
4.1
4.0
2.3
1.5
3.5
20.0
6.0
2.2
2.0
8.0
25.0
2.2
4.5
3.0
4.3
23.2
8.8
2.4
7.0
50.0
8.0
2.5
1.8
5.0
3.4
Current
Risk
Points
10.0 0.0
9.5 0.0
9.0 0.0
10.0 0.0
6.0 0.0
9.5 0.0
7.5 0.0
8.0 0.0
9.0 0.0
8.5 0.0
5.5 0.0
8.0 0.0
10.0 0.0
8.5 0.0
8.5 0.0
8.5 0.0
7.5 0.0
6.5 0.0
2.5 0.0
8.5 0.0
10.0 0.5
9.5 0.0
7.5 0.0
10.0 0.0
9.0 0.0
8.0 0.0
8.5 0.0
8.5 0.0
8.5 0.0
9.5 0.5
10.0 0.0
9.0 0.0
5.0 0.0
8.0 0.0
9.5 0.0
9.5 0.0
7.5 0.0
4.0 0.0
9.5 0.0
8.5 0.0
9.0 0.0
8.5 0.0
4.5 0.0
7.5 0.0
9.5 0.0
8.0 0.0
3.0 0.0
7.5 0.0
9.5 0.0
10.0 0.0
8.5 0.0
9.0 0.0
S-63
International Country Risk Guide
September 2003
Country
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
S-64
1998
10.3
2.2
-0.8
6.3
0.7
13.6
11.5
7.3
9.7
11.7
2.8
2.9
59.1
27.7
-0.4
1.1
29.8
14.9
-0.3
6.7
6.5
50.0
6.9
1.8
9.4
17.1
19.0
-0.3
0.1
-0.8
1.7
16.1
8.1
-1.4
5.6
3.2
84.6
6.9
10.6
2.0
3.4
1.6
10.8
35.8
7.2
11.5
24.5
31.8
1999
4.8
2.4
0.4
4.1
1.3
14.9
6.8
3.5
6.7
7.3
2.3
3.0
45.8
85.7
-1.6
0.8
42.4
35.5
0.1
10.6
8.0
40.0
5.3
2.3
4.7
16.0
98.9
0.5
0.8
-1.9
0.2
12.8
0.2
4.5
3.4
2.7
64.9
-0.2
22.7
2.1
1.6
2.1
5.6
23.6
4.1
8.0
26.8
58.5
2000
14.5
3.0
-1.1
4.3
1.4
15.6
8.9
3.7
4.4
10.2
2.9
3.0
45.7
20.8
-0.8
0.7
71.8
34.1
1.4
12.0
8.9
30.0
5.3
3.5
6.2
8.0
70.9
0.9
1.6
-0.5
1.3
7.9
1.6
-2.5
3.5
2.9
54.9
6.4
28.2
1.4
2.9
3.4
4.8
16.2
-1.7
10.9
30.0
55.9
2001
13.0
3.0
-1.0
3.2
0.3
9.3
7.3
2.0
6.1
5.5
4.4
3.0
34.5
21.5
-0.4
3.0
87.0
36.7
1.0
7.3
7.0
30.0
4.8
3.6
14.2
4.9
16.0
2.4
1.0
0.5
0.0
6.3
1.7
1.0
5.5
2.0
54.4
7.2
12.0
2.2
1.8
2.8
4.3
12.5
-0.4
11.9
18.7
76.7
2002
12.9
1.3
-0.7
1.6
1.0
11.8
10.5
0.1
3.1
1.9
3.5
2.5
22.5
15.8
-0.5
2.3
87.0
30.0
-0.4
3.3
5.8
30.0
8.9
3.1
9.5
6.0
23.0
2.2
0.7
0.9
-0.2
5.8
0.6
1.0
4.1
2.8
45.0
6.0
0.8
2.8
1.6
1.5
14.0
22.4
3.9
15.8
23.8
140.1
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
13.5
2.5
1.0
4.5
1.7
13.5
17.8
2.8
4.0
1.1
3.0
2.5
18.0
14.5
1.3
2.3
87.0
30.0
0.6
8.4
5.8
30.0
5.0
3.0
8.3
9.0
15.0
2.2
0.8
2.7
0.5
5.8
1.4
1.0
4.0
2.8
26.0
6.0
7.4
2.6
2.6
2.1
21.0
32.0
4.2
15.8
20.5
380.0
Current
Risk
Points
6.5 0.0
9.5 0.0
10.0 0.0
8.5 0.0
10.0 1.5
6.5 0.0
5.5 0.0
9.5 0.0
8.5 0.0
9.5 0.0
9.0 -0.5
9.5 0.0
5.5 0.0
6.0 0.0
10.0 0.0
9.5 0.0
1.5 0.0
4.0 0.0
10.0 0.0
7.5 0.0
8.5 0.0
4.0 0.0
8.5 0.5
9.0 0.0
7.5 -0.5
7.5 0.0
6.0 0.0
9.5 0.0
10.0 0.0
9.5 0.0
10.0 0.0
8.5 0.0
10.0 0.0
10.0 0.0
8.5 0.0
9.5 0.0
4.0 0.0
8.0 0.0
8.0 0.0
9.5 0.0
9.5 0.0
9.5 0.0
5.0 0.0
3.5 0.0
8.5 0.0
6.0 0.0
5.0 0.0
0.0 0.0
International Country Risk Guide
September 2003
TABLE 10
BUDGET BALANCE AS A PERCENTAGE OF GDP
This table shows the estimated general government budget balance for the current month and for
the preceding five years as percentage of the estimated GDP for the year in question. Risk
points are awarded in proportion to percentage budget balance as outlined in the Guide to
ICRG. The final column in the table shows the risk points assessed for the percentage budget
balance and the change, if any, from the previous month’s risk points.
Country
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
1998
-10.4
-3.8
-14.1
-1.4
-4.8
0.2
-2.7
-4.1
-1.7
-6.5
-3.4
-0.3
-1.8
-4.1
4.8
-7.8
0.5
2.7
-9.8
1.5
0.3
0.4
-1.6
-4.9
-7.4
-20.0
-2.5
-1.2
0.6
-2.2
-5.6
-1.6
1.7
0.9
0.4
-0.9
-1.8
-0.3
-4.3
-0.3
1999
-11.4
-0.5
-15.1
-2.9
-7.2
0.7
-2.4
-2.4
-1.6
-6.6
-4.6
-2.2
-0.7
-4.1
-6.0
-9.9
0.4
1.5
-12.7
0.1
0.9
-1.4
-2.5
-5.9
-3.0
-5.5
-2.2
-0.2
-0.8
-2.2
-4.5
-1.6
0.5
-0.5
-0.7
-0.1
-2.2
-4.6
-5.2
2.7
2000
-9.1
9.8
0.3
-2.4
-6.4
1.9
-1.4
-1.0
-0.8
-4.0
-6.1
-1.0
0.0
-4.4
6.1
-4.3
0.6
0.6
-1.4
1.4
1.3
0.1
-3.1
-6.8
-2.4
1.2
-2.9
-1.3
-6.3
-2.2
-4.8
-2.3
1.6
1.1
0.6
-1.2
-2.3
-0.3
-8.3
3.5
2001
-8.5
3.4
2.8
-3.3
-4.0
0.7
-0.7
-0.4
-0.4
-3.0
-5.5
-3.1
0.2
-7.5
9.0
-4.2
0.4
1.9
-2.6
2.4
1.3
-0.3
-4.4
-5.9
-1.1
5.4
-2.7
0.9
-6.6
-2.5
-2.9
-3.1
1.7
0.3
0.6
-2.2
-3.6
0.0
-7.6
0.7
2002
-7.5
-0.9
-5.2
-1.1
-3.0
-0.6
-1.6
-0.3
-3.4
-3.0
-4.4
-1.9
-0.3
-9.7
-2.8
-3.8
0.1
-0.1
-3.8
1.9
0.5
-0.8
-3.0
-5.6
-1.6
-8.2
-5.1
1.1
-6.6
-3.8
-2.2
-2.0
-0.1
0.1
0.8
-2.5
-3.2
0.0
-8.3
0.0
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
-7.0
0.5
-4.0
-1.9
-0.3
0.5
-0.9
-0.5
-2.8
-3.0
-4.2
-2.0
0.2
-6.5
-2.0
-3.8
-0.2
-1.0
-4.5
1.5
0.3
-1.0
-3.0
-5.0
-3.0
-6.0
-4.0
0.5
-6.6
-3.8
-2.2
-2.2
0.5
-0.5
0.6
-2.5
-2.8
0.0
-8.2
0.2
Current
Risk
Points
4.0 0.0
8.0 0.0
5.5 0.0
7.0 0.0
7.5 1.5
8.0 0.0
7.5 0.0
7.5 0.0
6.5 0.0
6.0 0.0
5.5 0.0
6.5 0.0
8.0 0.0
4.5 0.0
6.5 0.0
6.0 0.5
6.5 0.0
7.0 0.0
5.5 0.0
8.5 0.0
8.0 0.0
7.0 0.0
6.0 0.0
5.0 0.0
6.0 0.0
4.5 -4.0
5.5 0.0
8.0 0.0
4.5 0.0
6.0 0.0
6.5 0.0
6.5 0.0
8.0 -0.5
7.5 0.0
8.0 0.0
6.5 0.0
6.5 0.0
8.0 0.0
3.5 0.0
8.0 0.0
S-65
International Country Risk Guide
September 2003
Country
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
S-66
1998
-3.0
-14.5
-2.4
-2.2
-6.0
-5.9
-2.2
-2.9
-19.4
-8.3
-1.1
-0.4
-1.8
-6.3
0.5
-5.3
-3.0
-5.2
-8.0
2.0
-1.4
-2.3
-7.6
-7.9
-6.0
-4.4
-0.7
-10.0
-3.8
-6.0
-0.8
-35.8
-0.4
-0.7
-5.9
3.2
-6.3
-8.1
-1.3
-8.1
-8.9
-1.5
-10.6
-4.1
-2.1
-11.9
0.5
-2.5
-0.6
0.5
-1.9
-3.0
1999
-2.5
1.1
-3.5
-1.5
-6.5
-5.0
-2.8
-1.5
-14.4
-2.9
-2.4
-1.5
0.8
-3.7
2.4
-5.8
-1.2
-0.2
-8.0
1.7
-2.0
0.0
-6.5
-7.1
-3.5
-3.3
-0.7
-10.0
-2.7
4.3
-3.9
-29.0
-0.4
3.4
-8.5
3.8
-2.5
-5.5
-3.2
-8.7
-8.6
-1.6
-5.3
-14.3
-2.4
-10.6
-0.1
-3.9
-1.6
1.9
-5.0
-8.2
2000
-2.4
11.8
-1.4
1.1
-8.6
-4.3
-1.8
-5.5
-17.9
-7.1
-2.2
-4.3
-0.6
-3.4
2.4
-5.3
-5.2
-0.6
-8.0
3.1
0.9
-1.3
-3.8
-8.3
-4.7
-0.2
0.9
-10.0
1.3
26.9
-3.2
-26.8
-0.6
-3.4
-2.8
5.8
-4.0
-5.0
-5.7
-9.8
-7.6
-1.3
-2.0
-12.2
-5.9
-13.4
0.4
-3.2
-0.1
-0.4
-7.8
-9.0
2001
-2.5
7.5
-7.6
-2.8
-7.2
-4.0
-1.9
-0.2
-22.7
-9.5
-2.3
-6.4
-5.0
-3.0
-0.1
-4.7
-1.2
-0.5
-8.0
1.8
-3.7
-3.3
-0.9
-9.2
-3.7
-0.4
-1.7
-10.0
1.3
37.6
-2.2
-23.6
-0.7
2.1
-1.4
5.2
-6.5
0.0
-5.5
-13.0
-6.0
-0.7
-0.7
-6.8
-5.8
-16.7
-0.3
-1.5
-0.8
1.6
-11.3
-7.6
2002
-3.1
0.0
-2.2
-3.1
-5.0
-3.5
-0.7
-2.9
-20.9
-7.8
-2.5
-4.0
-4.8
-7.5
-0.5
-5.9
-1.7
-5.2
-8.0
-0.2
-4.0
-2.6
-5.6
-8.0
-4.1
0.0
-2.8
-10.0
2.1
22.3
-2.7
-19.2
-1.3
2.0
-1.4
1.0
-6.0
0.0
-5.6
-13.0
-6.0
-1.8
-2.3
-7.4
-4.5
-17.7
-1.0
-5.2
-1.6
1.1
-9.5
-7.2
Reproduction without permission of the Publisher is strictly forbidden
Current
Current
Risk
09/03
Points
-3.5 6.0 0.0
2.0 9.0 0.0
-2.2 6.5 0.0
-3.0 6.0 0.0
-4.5 5.5 -1.0
-3.2 6.0 0.0
-1.0 7.0 0.0
-2.9 6.5 0.0
-20.9 1.0 0.0
-6.5 4.5 0.0
-3.0 6.0 0.0
-4.0 5.5 0.0
-2.5 6.5 0.0
-6.0 4.5 0.0
-0.5 7.5 0.0
-5.9 5.0 0.0
-1.5 7.0 0.0
-3.0 6.0 0.0
-10.0 2.5 0.0
-0.3 7.5 0.0
-3.0 6.0 0.0
-2.8 6.5 0.0
-5.0 5.0 0.0
-8.0 3.5 0.0
-4.1 5.5 0.0
-0.4 7.5 0.0
-3.0 6.0 0.0
-10.0 2.5 0.0
1.5 8.5 0.0
25.0 10.0 0.0
-2.5 6.5 0.0
-14.7 2.0 0.0
-5.0 5.0 0.0
2.0 9.0 0.0
-1.4 7.0 0.0
1.0 8.5 0.0
-6.0 4.5 0.0
-3.0 6.0 0.0
-5.0 5.0 0.0
-13.0 2.0 0.0
-6.0 4.5 0.0
-1.8 7.0 0.0
-2.3 6.5 0.0
-7.4 4.0 0.0
-4.0 5.5 0.0
-17.7 1.5 0.0
-1.0 7.0 0.0
-4.0 5.5 0.0
-0.5 7.5 0.0
1.3 8.5 0.0
-10.0 2.5 0.0
-7.9 4.0 0.0
International Country Risk Guide
September 2003
Country
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
1998
-13.0
-2.9
-7.0
-6.4
-0.7
-1.6
-0.4
-0.2
-1.9
-1.0
-1.3
-10.4
-3.0
-4.7
-3.3
-3.3
-8.0
-7.0
16.8
-3.7
-0.6
0.0
-2.6
-0.9
-8.0
-0.6
-13.4
0.4
0.1
-0.7
2.1
1.7
-2.8
-7.1
-2.0
-0.9
-8.4
-0.7
-2.8
-0.3
0.6
0.6
-0.8
-3.8
-0.1
-6.4
-5.4
-4.4
1999
-5.1
-3.8
-7.8
-6.9
0.4
-2.9
-3.4
-2.3
-3.8
-0.8
-2.5
-4.3
-1.7
-1.2
-7.3
-3.5
-7.0
-10.4
10.4
-3.2
-0.6
0.0
-1.8
-1.1
-6.9
-0.9
-10.2
3.1
-0.6
0.7
0.1
1.7
-3.3
-3.9
-3.4
-2.6
-13.0
-1.3
-2.4
0.0
0.0
1.7
-3.7
-1.6
-1.6
-0.2
-3.6
-9.8
2000
6.5
10.5
-4.7
-5.5
0.3
-1.8
-4.0
-1.8
-4.1
0.3
-1.8
8.4
-3.7
2.4
-4.0
-2.9
-7.0
-10.3
11.5
-3.0
-1.4
0.0
-1.8
-0.3
-9.5
-1.0
-12.9
5.7
0.9
-0.7
-0.5
0.5
-2.2
-5.8
1.6
-3.7
-11.5
-1.4
-1.3
-0.2
1.8
2.6
-3.4
-1.7
-2.8
8.5
-6.7
-30.2
2001
-3.3
15.8
-4.3
-4.7
-2.3
-3.8
-0.9
-1.8
-4.0
-3.9
-4.2
0.1
-2.9
3.0
-3.5
-3.8
-6.0
-14.1
-0.3
-3.2
-1.3
0.0
-1.0
-0.8
-9.9
-1.0
0.0
3.6
0.3
-1.8
-2.3
0.9
-2.4
-4.0
1.8
-3.5
-19.6
-1.7
-0.7
-0.1
0.5
0.9
-4.7
-4.3
-2.9
2.8
-4.6
-40.9
2002
-5.9
9.4
0.9
-4.6
-1.4
-4.0
-3.3
-2.3
-5.3
-5.5
-2.7
0.8
-3.2
1.7
-3.0
-2.6
-6.0
-10.0
-1.2
-4.0
-2.6
0.0
-0.6
-0.7
-8.9
-2.3
-4.9
1.9
-1.0
-3.3
-2.7
0.8
-1.5
-4.0
-0.3
-3.1
-14.2
-2.0
-1.9
-0.8
-1.9
-2.2
-4.6
-3.8
-2.6
0.4
-3.4
-29.1
Reproduction without permission of the Publisher is strictly forbidden
Current
Current
Risk
09/03
Points
-4.9 5.5 0.0
8.0 10.0 0.0
0.9 8.0 0.0
-3.5 6.0 0.0
-1.5 7.0 0.0
-3.0 6.0 0.0
-3.5 6.0 0.0
-2.0 6.5 0.0
-5.0 5.0 0.0
-5.0 5.0 0.0
-2.3 6.5 0.0
0.8 8.0 0.0
-3.0 6.0 -1.0
1.0 8.5 0.0
-3.0 6.0 0.0
-2.6 6.5 0.0
-6.0 4.5 0.0
-10.0 2.5 0.0
-0.9 7.5 0.0
-4.0 5.5 0.0
-2.6 6.5 0.0
0.0 8.0 0.0
-1.0 7.0 0.0
0.2 8.0 0.0
-9.0 3.0 0.0
-2.0 6.5 0.0
-4.9 5.5 0.0
1.8 8.5 0.0
0.3 8.0 0.0
-2.5 6.5 0.0
-2.5 6.5 0.0
0.8 8.0 0.0
-1.5 7.0 0.0
-4.0 5.5 0.0
-0.5 7.5 0.0
-2.8 6.5 0.0
-12.0 2.0 0.0
-2.0 6.5 0.0
-2.0 6.5 0.0
0.0 8.0 0.0
-2.0 6.5 0.0
-3.0 6.0 0.0
-4.0 5.5 -0.5
-3.8 6.0 0.0
-2.7 6.5 0.0
0.4 8.0 0.0
-7.0 4.0 0.0
-29.0 0.5 0.0
S-67
International Country Risk Guide
September 2003
TABLE 11
CURRENT ACCOUNT AS A PERCENTAGE OF GDP
This table shows the estimated annual balance of the current account of the balance of payments
for the current month and for the preceding five years as percentage of the estimated GDP for
the year in question. Risk points are awarded in proportion to percentage current account
balance as outlined in the Guide to ICRG. The final column in the table shows the risk points
assessed for the percentage current account balance and the change, if any, from the previous
month’s risk points.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
S-68
1998
-6.1
-1.8
-29.0
-4.9
-27.1
-5.0
-2.5
-35.1
-27.2
-17.0
-0.1
-6.1
4.9
-7.9
3.6
-4.3
35.0
-0.5
-14.5
-2.5
-1.3
-5.1
3.3
-4.9
-11.1
-12.3
-3.7
-2.5
-7.1
-2.1
-0.1
-2.3
-1.2
-2.2
-10.6
-3.1
-0.8
-9.2
-1.6
1999
-7.3
0.0
-28.1
-4.2
-21.7
-5.9
-3.2
-13.2
-10.5
-15.5
-0.8
-1.6
5.6
-5.9
11.2
-4.7
39.0
-5.3
-16.0
-4.3
0.2
-0.4
2.1
0.8
-8.0
-9.8
-4.3
-1.1
-6.9
-2.2
1.2
-2.7
1.7
-2.5
6.7
-1.8
-1.9
-4.7
-7.9
2000
-7.2
16.8
9.0
-3.1
-19.9
-4.0
-2.5
-3.2
-10.2
3.7
-0.7
-2.5
5.0
-5.4
11.2
-4.0
34.8
-5.6
-15.0
-1.7
2.6
-1.4
1.9
0.8
-1.3
20.2
-4.8
-2.6
-2.3
-3.2
1.1
-5.2
1.6
-5.3
6.6
-1.1
-3.3
-6.4
0.2
2001
-6.3
13.0
-15.9
-1.7
-18.9
-2.4
-2.2
-0.9
-8.0
2.9
-1.2
-2.3
4.1
-3.6
12.2
-4.6
32.9
-6.2
-13.6
-1.7
2.8
-1.9
1.5
-1.5
-3.3
-1.0
-4.3
-0.7
-3.1
-2.1
-3.1
-4.6
2.5
-3.9
-4.7
-0.5
-1.3
-6.5
-7.4
2002
-8.7
8.0
-6.5
2.0
-18.9
-3.1
0.7
-12.6
-8.2
-2.7
0.5
-2.0
4.7
-4.0
9.9
-1.7
29.7
-4.4
-12.9
-4.1
1.5
-0.9
1.2
-2.0
-3.6
-0.9
-5.6
-1.9
-2.8
-2.7
-3.1
-5.3
2.9
-4.2
-6.6
0.0
-2.7
-6.8
-6.1
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
-7.7
12.1
-5.2
3.4
-18.9
-4.3
-0.2
-12.8
-10.9
-2.7
0.1
-2.0
4.9
-4.0
7.4
-0.5
26.3
-4.8
-14.2
-3.3
1.9
-0.2
0.5
-2.0
-9.6
-53.6
-4.9
-1.9
-2.8
-2.6
-3.1
-4.4
2.4
-3.1
-3.1
-1.0
-2.7
-6.8
-4.9
Current
Risk
Points
9.5 0.0
15.0 0.0
10.0 0.0
13.0 0.0
6.0 0.0
10.0 0.0
11.5 0.0
8.0 0.0
8.5 0.0
10.5 0.0
15.0 0.0
10.5 0.0
13.5 0.0
10.0 0.0
14.0 0.0
11.5 0.5
15.0 0.0
10.0 0.0
7.5 0.0
10.5 0.0
12.5 0.0
11.5 0.0
12.0 0.0
10.5 0.0
9.0 0.0
0.0 -12.5
10.0 0.0
11.0 0.0
10.5 0.0
10.5 0.0
13.0 0.0
10.0 0.0
13.0 0.5
10.5 0.0
10.5 0.0
11.0 0.0
10.5 0.0
9.5 0.0
9.5 0.0
International Country Risk Guide
September 2003
COUNTRY
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
1998
5.7
2.6
-13.4
-3.0
-0.3
-5.9
-3.0
-5.4
-3.5
-13.2
-13.9
-1.1
-7.4
2.7
-4.9
-7.0
-1.6
4.3
-1.1
-1.1
1.2
-1.4
1.7
-4.4
3.0
0.3
-5.8
-4.2
-10.0
12.7
8.8
-10.6
-40.2
-11.5
-1.2
-12.1
8.8
-7.4
-9.3
13.2
-7.5
-4.7
-3.8
-16.7
5.9
-0.4
-17.8
-0.2
2.3
3.4
-3.9
-24.2
1999
6.3
2.4
8.5
-4.4
-0.9
-12.1
-5.8
-5.6
-2.8
-12.4
-11.8
-1.5
-11.4
7.5
-4.4
-6.9
-0.7
4.1
2.7
-2.1
0.4
-2.0
0.7
-2.9
2.6
5.0
-1.0
-0.9
-0.1
6.0
17.3
-9.7
-33.9
-28.6
7.0
-11.2
6.5
-5.4
-2.5
15.9
-9.3
-5.0
-2.9
-3.6
-13.2
-0.5
-21.3
-0.1
2.4
4.0
-6.3
-31.2
2000
7.5
1.6
3.2
-4.7
-1.1
-8.2
-8.7
-5.4
-2.8
-18.2
-15.7
-2.2
-9.3
5.5
-2.9
-10.1
-0.9
5.3
3.9
-1.0
0.6
-1.0
-0.5
-5.1
2.5
0.7
3.7
-1.9
0.2
2.7
39.7
-6.9
-33.0
-15.9
-3.5
-6.0
8.2
-7.5
-8.3
9.4
-9.8
-4.9
-3.1
-8.4
-13.7
-1.5
-30.1
-0.1
3.8
2.5
-5.3
-20.2
2001
7.1
1.6
-0.9
-6.7
0.1
-5.3
-8.0
-5.9
-1.5
-22.7
-17.6
-2.9
-10.5
7.2
-2.1
-4.4
0.2
4.8
1.6
-1.0
-1.0
-2.1
-0.1
-10.2
2.1
-0.1
-5.8
-2.8
0.2
1.9
25.0
-9.6
-23.2
-20.6
6.6
-6.7
4.6
-7.5
-7.8
8.3
-13.0
-4.5
-2.9
-7.4
-17.2
4.8
-28.5
-0.1
5.1
2.3
-2.8
-21.9
2002
7.5
1.8
-4.7
-5.0
2.3
0.7
-7.8
-5.1
-0.7
-18.9
-14.3
-1.6
-7.6
10.8
-4.0
-2.0
0.7
4.2
0.9
0.0
-0.1
-2.1
-0.6
-13.3
2.7
-0.4
-2.5
-1.9
-0.3
1.3
22.9
-7.8
-22.8
-5.1
8.4
-5.8
4.1
-6.6
-7.7
7.6
-13.0
-4.5
-2.2
-7.2
-16.7
4.1
-18.8
0.1
4.4
2.8
-3.9
-26.6
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
6.6
1.8
-5.9
-5.0
1.8
-2.3
-6.5
-4.6
-1.2
-18.9
-16.6
-6.4
-6.7
8.4
-4.3
-2.0
0.1
3.7
0.8
1.4
-0.5
-0.5
0.1
-1.0
2.8
-0.4
-2.3
-2.1
-0.3
0.2
22.1
-7.0
-22.0
-12.0
7.6
-5.8
4.1
-6.5
-7.7
5.6
-13.0
-4.5
-1.9
-7.0
-16.7
1.5
-18.8
-0.1
4.6
2.9
-3.2
-23.3
Current
Risk
Points
14.0 0.0
12.5 0.0
10.0 0.0
10.0 0.0
12.5 0.0
10.5 0.0
9.5 0.0
10.0 0.0
11.0 0.0
6.0 0.0
7.0 0.0
9.5 0.0
9.5 0.0
14.5 0.0
10.0 0.0
10.5 0.0
12.0 1.0
13.0 0.0
12.0 0.0
12.5 1.5
11.5 0.0
11.5 1.0
12.0 0.5
11.0 0.0
13.0 0.0
11.5 0.0
10.5 0.0
10.5 0.0
11.5 0.0
12.0 0.5
15.0 0.0
9.5 0.0
4.0 0.0
8.0 0.0
14.0 0.0
10.0 0.0
13.5 0.0
9.5 0.0
9.5 0.0
13.5 0.0
8.0 0.0
10.0 0.0
11.0 0.0
9.5 0.0
7.0 0.0
12.5 0.0
6.0 0.0
11.5 0.0
13.5 0.0
13.0 0.0
10.5 0.0
3.5 0.0
S-69
International Country Risk Guide
September 2003
COUNTRY
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
S-70
1998
-10.0
-9.0
0.0
-20.9
-3.8
-11.5
-0.8
-1.9
-5.9
2.4
-4.3
-7.3
-20.7
-6.9
0.1
-9.0
-2.3
-5.0
-1.0
24.0
-9.7
-0.8
-1.0
-1.6
-0.5
-1.5
-8.9
-18.3
1.9
10.2
0.1
1.3
-12.0
12.7
-16.1
-10.6
-3.4
1.0
-8.4
-3.1
0.3
-0.6
-2.3
-2.1
-3.4
-3.9
-2.8
-17.0
-5.7
1999
-9.5
1.4
5.3
-1.8
-1.5
-12.5
2.6
-2.2
-2.9
10.4
-8.1
-8.5
7.1
-3.7
12.7
0.3
-2.3
-7.5
-6.3
20.0
-5.7
-3.9
-1.0
-0.5
-2.3
-3.6
-4.7
-3.4
2.4
11.5
0.3
2.9
-14.8
10.1
-12.5
0.5
-2.1
-0.7
-8.9
5.4
6.4
-2.2
-3.1
-2.4
3.5
4.1
2.8
-13.4
0.5
2000
-7.8
5.0
15.5
17.2
-0.2
-8.5
10.3
-3.8
-2.9
11.3
-6.1
-10.4
22.2
-3.7
18.0
7.6
-7.0
-8.3
-2.8
17.4
-3.5
-3.4
-1.0
-0.5
-3.4
-6.4
-5.1
3.5
2.8
14.0
1.3
2.9
-15.9
7.6
-14.1
6.7
-4.2
-4.9
-9.5
4.7
19.6
-2.0
-4.2
-2.8
10.8
3.5
14.1
-16.3
-1.5
2001
-7.8
2.8
15.6
11.6
3.4
-4.5
9.7
-3.6
-2.0
5.8
-2.9
-9.4
16.7
-5.6
11.3
7.8
-4.3
-17.7
-8.0
21.1
-8.9
-0.4
-1.0
-0.3
-2.8
-1.7
-5.2
-10.1
3.1
9.2
0.6
6.4
-11.3
5.4
-14.5
4.7
-4.3
2.3
-7.9
3.7
12.6
-1.3
-3.9
-2.6
3.1
2.1
6.8
-19.8
-1.4
2002
-8.4
-2.4
13.8
7.4
-0.7
-1.5
-2.6
5.4
-2.0
5.7
-3.5
-7.5
13.1
-3.4
9.5
4.8
-6.7
-17.7
-6.0
21.6
-8.2
-0.3
-1.0
0.3
-2.4
-2.5
-7.3
-2.4
2.8
11.9
1.0
9.1
-11.0
6.0
-14.5
1.1
-3.6
-1.0
-8.0
7.7
5.8
-0.8
-4.6
2.1
8.0
-3.1
4.0
-17.4
-4.0
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
-8.1
-2.0
11.4
4.9
6.9
-2.7
0.7
2.3
-1.9
3.5
-3.8
-5.8
12.4
-4.1
7.1
5.6
-6.7
-17.7
-6.0
17.5
-5.7
-0.3
-1.0
-1.0
-3.0
-2.8
-5.4
-2.4
3.6
11.5
-0.1
7.7
-11.0
2.8
-14.5
3.6
-3.1
-2.5
-8.0
3.9
10.2
-1.3
-5.2
1.2
12.4
-2.7
4.0
-19.3
-9.7
Current
Risk
Points
9.0 0.0
10.5 0.0
15.0 0.0
13.5 0.0
14.0 0.0
10.5 -0.5
12.0 0.0
13.0 0.0
11.0 0.0
13.0 0.0
10.5 0.0
10.0 0.0
15.0 0.0
10.0 -0.5
14.0 0.0
13.5 0.0
9.5 0.0
6.5 0.0
9.5 0.0
15.0 0.0
10.0 0.0
11.5 0.0
11.0 0.0
11.0 -0.5
10.5 0.0
10.5 0.0
10.0 -0.5
10.5 0.0
13.0 0.0
15.0 0.0
11.5 0.0
14.0 0.0
8.5 0.0
13.0 0.0
7.5 0.0
13.0 0.0
10.5 0.0
10.5 0.0
9.0 0.0
13.0 0.0
15.0 0.0
11.0 0.0
10.0 0.0
12.5 0.0
15.0 0.0
10.5 -0.5
13.5 0.0
5.5 0.0
9.0 0.0
International Country Risk Guide
September 2003
TABLE 12
FOREIGN DEBT AS A PERCENTAGE OF GDP
This table shows the estimated total foreign debt for the current month and for the preceding five
years as percentage of the estimated GDP for the year in question. Risk points are awarded in
proportion to the percentage foreign debt as outlined in the Guide to ICRG. The final column in
the table shows the current risk points assessed for the percentage foreign debt and the change,
if any from the previous month’s risk points.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
1998
31.8
62.0
131.2
46.5
41.4
59.0
10.6
13.1
34.2
3.5
37.8
33.2
18.5
55.3
30.8
26.2
2.0
79.6
54.7
83.7
34.7
39.9
15.7
40.5
250.2
268.2
40.3
166.4
40.3
43.3
1.0
42.7
24.2
31.7
82.2
34.2
22.1
14.3
78.8
110.8
1999
64.1
57.5
121.3
52.6
46.3
57.6
10.7
21.1
33.1
3.5
38.7
5.5
18.5
55.5
29.5
41.0
2.0
79.1
59.9
81.1
28.0
46.7
14.8
45.3
122.3
224.3
38.2
170.2
44.5
39.9
0.9
41.4
20.9
29.5
159.1
31.8
22.4
14.0
82.4
112.9
2000
72.1
46.6
121.9
43.5
45.1
61.2
11.2
23.0
30.8
3.5
34.7
5.2
20.2
52.6
26.4
38.6
3.0
88.9
62.1
70.2
22.9
48.3
14.4
46.4
107.2
158.1
40.0
196.2
53.1
39.7
0.9
42.0
22.6
27.1
97.1
30.3
21.6
13.6
85.7
113.3
2001
69.6
40.8
111.0
49.1
46.3
57.3
10.9
20.6
32.9
3.5
35.7
6.8
17.5
44.0
26.7
41.1
2.0
78.1
63.0
75.6
19.9
57.2
13.0
47.8
201.2
196.3
41.0
194.1
51.9
42.5
1.0
38.1
20.5
28.3
80.2
33.0
22.9
13.5
90.1
106.0
2002
64.4
47.6
111.3
39.0
46.3
51.8
10.2
24.0
35.7
3.5
35.5
7.0
16.2
47.6
25.1
51.3
2.0
70.2
63.0
67.5
16.1
60.8
13.2
46.1
278.0
192.8
40.6
140.0
49.3
45.5
1.0
33.7
20.7
29.4
75.2
33.3
28.0
13.5
102.3
102.4
Reproduction without permission of the Publisher is strictly forbidden
Current
Current
Risk
09/03
Points
64.5 4.5 0.0
45.4 5.5 0.0
114.0 2.0 0.0
45.0 5.5 0.0
46.3 5.5 0.0
55.0 5.0 0.0
10.2 9.0 0.0
22.6 8.0 0.0
37.0 6.5 0.0
3.5 10.0 0.0
35.2 6.5 0.0
7.5 9.5 0.0
16.1 8.5 0.0
47.0 5.5 0.0
26.0 7.5 0.0
50.5 5.0 0.0
2.0 10.0 0.0
69.8 4.5 0.0
63.0 4.5 0.0
67.0 4.5 0.0
16.0 8.5 0.0
60.0 4.5 0.0
13.6 9.0 0.0
43.0 6.0 0.0
250.0 0.0 0.0
195.6 0.5 0.0
39.8 6.5 0.5
140.0 1.0 0.0
49.3 5.5 0.0
45.7 5.5 0.0
1.0 10.0 0.0
33.0 7.0 0.0
20.4 8.0 0.0
28.5 7.5 0.0
75.0 4.0 0.0
35.0 6.5 0.0
32.0 7.0 0.0
13.5 9.0 0.0
102.3 2.5 0.0
101.3 2.5 -3.0
S-71
International Country Risk Guide
September 2003
COUNTRY
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
S-72
1998
26.9
107.1
97.5
15.3
74.8
38.0
18.7
60.6
365.0
220.8
30.9
77.9
23.0
50.3
72.4
23.4
158.1
6.1
82.1
17.3
40.5
5.8
50.9
0.2
29.5
47.0
55.5
100.0
46.9
35.4
31.3
176.3
550.0
20.6
34.8
1.0
91.9
90.4
47.4
113.9
83.6
38.4
56.4
68.4
54.2
109.1
2.6
6.0
32.8
98.6
309.2
44.0
1999
27.2
105.6
101.6
15.7
109.9
35.8
20.9
59.2
350.0
235.3
31.5
81.0
23.1
59.4
84.5
22.1
105.8
4.3
80.9
15.5
42.1
6.1
46.3
0.2
94.0
68.8
60.7
100.0
33.8
27.9
29.3
188.3
550.0
19.2
42.5
1.0
92.0
142.7
46.4
114.0
83.7
34.7
71.8
77.4
56.7
99.6
1.9
6.0
32.0
100.4
298.6
76.2
2000
27.9
88.6
110.0
17.3
169.8
41.5
20.4
56.9
350.0
234.3
32.8
70.4
23.0
62.7
108.9
21.8
98.7
2.4
81.4
17.3
54.2
6.7
41.5
0.2
79.5
69.3
57.4
100.0
28.5
23.3
27.6
173.6
442.8
18.2
43.2
1.0
92.0
143.3
41.9
114.0
82.3
25.7
73.9
93.9
45.9
93.1
4.1
6.2
34.8
101.4
296.3
83.8
2001
24.9
65.0
126.9
14.2
131.5
32.5
18.6
56.0
320.0
206.8
36.6
74.4
21.9
64.9
124.3
22.0
103.0
1.9
122.9
15.8
49.8
8.1
41.1
0.2
81.5
70.8
50.6
100.0
28.1
24.0
27.0
153.0
486.9
20.0
44.8
1.0
92.0
156.5
44.9
114.0
81.0
22.1
74.2
88.0
52.6
91.6
7.0
6.2
30.4
110.6
274.6
90.3
2002
23.4
64.9
130.7
13.1
112.4
32.8
17.1
55.9
320.0
211.7
38.4
78.4
21.6
55.1
130.0
22.0
82.3
1.8
486.0
14.2
55.2
7.4
49.0
0.2
83.0
73.8
46.7
100.0
34.2
24.1
27.0
170.7
498.2
29.7
44.8
1.0
92.0
180.4
42.8
114.0
81.0
22.0
66.5
89.4
48.8
91.0
7.0
6.5
28.7
96.5
284.5
86.0
Reproduction without permission of the Publisher is strictly forbidden
Current
Current
Risk
09/03
Points
23.2 8.0 0.0
65.0 4.5 0.0
130.7 1.0 0.0
13.5 9.0 0.0
107.3 2.5 -0.5
32.0 7.0 0.0
18.0 8.5 0.0
56.0 5.0 0.0
320.0 0.0 0.0
212.0 0.0 0.0
34.0 7.0 0.0
78.0 4.0 0.0
20.0 8.0 0.0
53.7 5.0 0.5
120.0 1.5 0.0
21.0 8.0 0.0
93.0 3.0 0.0
2.0 10.0 0.0
501.1 0.0 -1.5
14.4 9.0 0.0
55.2 5.0 0.0
7.4 9.5 0.0
49.0 5.5 0.0
0.2 10.0 0.0
78.5 3.5 0.0
75.0 4.0 0.0
50.0 5.0 0.0
100.0 2.5 0.0
34.3 7.0 0.5
23.8 8.0 0.5
27.0 7.5 0.0
189.0 0.5 0.0
535.7 0.0 0.0
25.0 7.5 0.0
44.8 6.0 0.0
1.0 10.0 0.0
92.0 3.0 0.0
180.4 0.5 0.0
41.6 6.0 0.0
114.0 2.0 0.0
81.0 3.5 0.0
21.5 8.0 0.0
66.5 4.5 0.0
89.4 3.5 0.0
48.0 5.5 0.0
91.0 3.0 0.0
7.0 9.5 0.0
6.5 9.5 0.0
31.0 7.0 0.0
94.9 3.0 0.0
280.0 0.0 0.0
85.0 3.5 0.0
International Country Risk Guide
September 2003
COUNTRY
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
1998
62.5
0.0
44.8
53.7
63.4
67.5
19.3
46.7
73.4
37.1
65.8
98.7
22.1
66.1
13.9
66.9
53.0
134.6
15.2
54.1
10.7
100.0
27.9
16.8
61.0
218.8
25.6
45.2
0.2
32.5
12.0
482.0
94.0
85.5
24.3
56.5
48.5
63.0
26.3
39.0
5.6
9.3
36.7
37.1
39.7
85.3
194.3
77.8
1999
82.0
0.0
43.1
63.5
55.3
76.6
28.9
51.1
67.0
42.2
62.4
95.8
26.1
89.4
13.2
65.1
53.0
175.7
18.2
52.0
11.2
100.0
29.7
16.4
63.2
206.3
29.5
43.8
0.2
31.7
13.4
439.3
77.6
85.0
24.2
60.1
55.8
69.1
40.6
33.7
5.5
8.8
40.8
30.4
38.7
80.4
163.8
92.5
2000
69.5
0.0
35.0
65.3
61.4
52.4
40.2
41.1
74.8
42.4
67.7
86.5
27.5
71.3
13.4
61.3
53.0
178.2
18.0
54.7
9.8
100.0
28.8
18.3
60.8
185.5
28.2
39.3
0.0
34.5
11.2
426.5
65.0
82.9
20.8
59.7
60.0
61.7
33.1
25.9
5.8
8.8
44.3
26.0
44.3
63.7
177.0
89.1
2001
55.2
0.0
29.5
68.9
56.7
53.8
41.0
47.6
68.1
39.2
61.3
91.7
30.1
55.1
13.3
61.0
56.0
206.6
15.4
55.6
10.0
100.0
33.3
16.0
61.8
179.6
43.0
36.4
0.2
29.6
12.2
426.5
58.5
82.0
18.3
60.2
81.6
57.5
27.2
20.4
5.5
8.5
48.1
24.7
43.8
66.8
197.6
94.6
2002
62.9
0.0
30.5
59.4
58.0
56.6
59.4
49.9
67.5
43.5
56.3
93.0
34.2
44.3
13.8
61.0
56.0
200.0
14.4
55.7
10.0
60.0
31.8
15.4
60.9
171.7
43.9
32.5
0.2
31.9
15.1
425.0
47.1
82.0
17.2
61.0
56.5
57.0
32.1
20.0
5.3
8.6
83.3
31.3
40.3
66.8
185.2
105.3
Reproduction without permission of the Publisher is strictly forbidden
Current
Current
Risk
09/03
Points
60.0 4.5 0.0
0.0 10.0 0.0
30.0 7.0 0.0
59.0 5.0 0.0
57.3 5.0 0.0
57.5 5.0 0.5
42.5 6.0 0.0
48.0 5.5 0.0
66.0 4.5 0.0
42.0 6.0 0.0
56.3 5.0 0.0
93.0 3.0 0.0
32.7 7.0 0.0
42.5 6.0 0.0
14.0 9.0 0.0
61.0 4.5 0.0
56.0 5.0 0.0
200.0 8.0 0.0
13.5 9.0 0.0
56.0 5.0 0.0
10.0 9.0 0.0
60.0 4.5 0.0
31.9 7.0 0.0
15.1 8.5 0.0
58.2 5.0 0.5
164.1 0.5 0.0
43.6 6.0 0.0
32.0 7.0 0.0
0.2 10.0 0.0
32.0 7.0 0.0
15.0 8.5 0.0
425.0 0.0 0.0
46.0 5.5 0.0
82.0 3.5 0.0
16.6 8.5 0.0
58.7 5.0 0.0
55.0 5.0 0.0
57.0 5.0 0.0
31.0 7.0 0.0
20.0 8.0 0.0
5.4 9.5 0.0
8.6 9.5 0.0
85.3 3.5 -0.5
33.0 7.0 0.0
37.9 6.5 0.0
66.8 4.5 0.0
172.9 0.5 0.0
124.9 1.5 -1.0
S-73
International Country Risk Guide
September 2003
TABLE 13
DEBT SERVICE AS A PERCENTAGE OF TOTAL EXPORTS
This table shows the estimated foreign debt servicing costs for the current month and for the
preceding five years as percentage of the estimated total value of exports of goods and services
for the year in question. Risk points are awarded in proportion to the percentage debt service as
outlined in the Guide to ICRG. The final columns in the table show the risk points assessed for
the percentage debt service and the change from the preceding month.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
S-74
1998
50.0
46.3
28.7
56.7
44.8
9.9
1.9
5.3
5.5
15.0
8.0
20.0
3.1
28.6
3.1
55.9
0.0
13.1
16.9
16.1
5.2
21.4
8.7
17.9
2.0
39.1
12.2
24.9
12.5
40.0
13.2
15.4
15.0
5.8
28.2
8.5
10.4
32.3
57.7
16.0
1999
45.0
40.3
18.7
75.8
39.6
10.1
1.9
6.5
5.5
16.0
9.2
12.7
3.2
19.0
3.1
56.3
0.0
18.0
11.9
24.3
4.8
24.0
9.0
41.5
1.2
33.2
12.6
26.8
12.5
40.0
13.8
12.7
14.9
3.9
26.2
7.2
8.5
33.4
63.3
16.0
2000
45.0
20.3
15.1
71.3
30.0
10.0
1.9
8.0
5.5
16.0
9.5
10.6
3.3
18.4
0.6
55.9
0.0
16.7
24.5
20.5
4.5
26.0
7.4
28.6
3.0
23.6
13.0
22.4
12.5
40.0
14.0
12.3
14.7
4.8
17.3
8.0
7.2
33.4
52.2
16.0
2001
45.0
22.8
15.0
69.0
25.0
10.0
2.0
8.9
5.5
12.0
8.8
12.9
3.3
14.0
3.2
56.2
0.0
20.1
26.5
26.3
4.4
28.0
8.7
20.0
5.0
23.1
13.0
20.6
12.0
40.0
14.0
8.6
14.5
5.8
18.6
7.4
6.8
33.0
23.2
16.0
2002
30.0
20.8
12.0
77.0
25.0
10.0
2.0
3.4
5.5
12.0
9.3
12.4
3.0
12.0
3.2
55.0
0.0
18.8
26.4
28.7
3.0
28.0
8.7
20.0
3.5
21.9
13.0
38.0
12.0
40.0
14.0
9.6
14.5
6.0
19.0
12.3
8.8
33.0
22.4
16.0
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
30.0
20.0
12.0
77.0
25.0
10.0
1.9
6.8
5.5
12.0
9.1
12.5
2.8
15.0
3.2
53.3
0.0
18.8
24.8
28.0
3.0
28.0
8.7
20.0
5.0
22.4
12.5
38.0
12.0
40.5
14.0
10.0
14.4
6.0
19.0
12.0
10.0
33.0
22.4
16.1
Current
Risk
Points
6.5 0.0
8.0 0.0
9.0 0.0
1.0 0.0
7.0 0.0
9.0 0.0
10.0 0.0
9.5 0.0
9.5 0.0
9.0 0.0
9.0 0.0
9.0 0.0
10.0 0.0
8.5 0.0
10.0 0.0
3.5 0.0
10.0 0.0
8.0 0.0
7.5 0.0
7.0 0.0
10.0 0.0
7.0 0.0
9.5 0.0
8.0 0.0
9.5 0.0
7.5 -1.5
9.0 0.5
5.5 0.0
9.0 0.0
5.5 0.0
8.5 0.0
9.0 0.0
8.5 0.0
9.5 0.0
8.0 0.0
9.0 0.0
9.0 0.0
6.0 0.0
7.5 0.0
8.5 0.0
International Country Risk Guide
September 2003
COUNTRY
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
1998
21.7
13.9
11.4
8.8
22.1
27.8
15.0
19.5
18.0
14.6
17.8
20.0
1.7
28.7
19.3
19.1
31.5
9.3
65.0
2.3
16.2
4.8
18.0
0.0
18.0
14.7
23.6
60.0
12.1
0.0
10.0
12.0
70.0
6.0
18.3
1.0
26.5
14.8
7.0
11.4
10.0
47.9
39.4
9.8
23.9
24.9
14.9
3.0
6.0
39.0
16.4
24.6
1999
22.0
18.8
11.4
8.8
21.1
28.0
10.3
15.6
18.0
10.4
15.8
18.7
1.5
26.6
18.9
18.1
30.4
23.8
62.0
2.6
16.1
5.0
13.8
0.0
18.0
19.3
25.9
60.0
11.9
0.0
10.0
7.0
70.0
6.0
20.0
1.0
17.5
18.2
6.3
12.5
12.0
43.8
37.0
10.0
20.8
33.5
14.8
3.0
5.9
39.2
11.8
23.8
2000
21.0
15.0
8.5
9.0
23.3
20.0
9.4
15.3
18.0
11.8
14.0
15.5
1.4
17.3
19.0
16.3
25.3
12.5
60.0
2.5
15.5
5.0
14.1
0.1
18.0
16.8
17.3
60.0
17.0
0.0
10.0
6.0
70.0
6.0
20.9
1.0
15.4
17.7
5.6
13.0
12.0
41.8
37.0
12.0
20.1
15.3
15.0
4.0
5.9
39.0
12.6
23.2
2001
20.0
14.5
16.0
8.6
18.9
20.0
10.2
19.0
20.0
10.3
8.3
12.9
1.5
18.5
19.0
12.3
43.8
7.8
65.0
2.5
15.6
4.9
14.1
0.1
20.0
15.0
17.6
60.0
10.8
3.0
8.0
7.0
70.0
5.0
13.5
1.0
17.2
20.6
6.2
9.8
12.0
39.4
37.0
13.0
16.2
12.2
18.0
4.0
5.8
38.7
10.8
30.8
2002
20.0
12.0
11.9
8.8
18.4
20.0
16.0
19.0
20.0
11.0
8.5
20.0
1.5
18.5
19.0
12.4
49.7
3.7
65.0
4.5
15.6
4.5
18.4
0.1
20.0
15.0
20.4
60.0
10.8
3.0
8.0
8.0
70.0
5.2
13.5
1.0
16.0
20.0
6.2
9.8
12.0
39.7
37.0
13.0
17.3
8.2
15.6
4.0
4.7
38.7
11.0
36.4
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
19.8
12.0
11.9
8.5
18.1
20.0
16.0
19.0
20.0
11.0
8.0
15.0
1.5
17.7
19.0
12.8
30.0
6.7
117.6
3.4
16.3
4.2
18.4
0.1
20.00
15.0
20.4
60.0
10.7
2.7
8.0
8.0
70.0
5.0
13.5
1.0
16.0
20.0
7.1
9.8
12.0
32.0
37.0
13.0
17.0
8.2
15.0
4.0
5.0
36.9
25.0
36.4
Current
Risk
Points
8.0 0.0
9.0 0.0
9.0 0.0
9.5 0.0
8.0 1.0
8.0 0.0
8.5 0.0
8.0 0.0
8.0 0.0
9.0 0.0
9.5 0.0
8.5 0.0
10.0 0.0
8.0 0.0
8.0 0.0
9.0 0.0
6.5 0.0
9.5 0.0
0.0 -2.5
10.0 0.0
8.5 0.0
10.0 0.0
8.0 0.0
10.0 0.0
8.0 0.0
8.5 0.0
8.0 0.0
3.0 0.0
9.0 0.0
10.0 0.0
9.5 0.0
9.5 0.0
2.0 0.0
9.5 0.0
8.5 0.0
10.0 0.0
8.5 0.0
8.0 0.0
9.5 0.0
9.0 0.0
9.0 0.0
6.5 0.0
5.5 0.0
8.5 0.0
8.0 0.0
9.5 0.0
8.5 0.0
10.0 0.0
9.5 0.0
6.0 0.0
7.0 0.0
6.0 0.0
S-75
International Country Risk Guide
September 2003
COUNTRY
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
S-76
1998
12.3
0.0
10.9
19.0
21.5
22.5
8.7
28.6
11.9
9.2
16.7
21.2
21.0
13.4
5.1
12.4
45.0
30.7
1.4
12.0
10.0
30.0
13.7
22.0
13.3
1.5
9.2
14.5
1.9
6.0
2.9
37.9
21.8
12.3
9.9
19.2
26.8
26.4
12.5
3.4
2.7
27.0
32.6
25.5
13.2
26.1
16.0
21.2
1999
29.8
0.0
12.7
29.4
24.5
27.3
6.3
54.4
13.6
20.4
16.8
23.4
26.6
14.1
6.1
10.9
45.0
47.8
1.0
13.7
10.0
30.0
13.1
21.8
15.2
4.4
9.2
15.1
1.9
6.4
3.0
37.3
19.8
11.5
8.0
18.5
35.3
18.4
16.6
3.4
2.7
27.0
33.0
23.6
14.5
26.5
16.2
21.8
2000
15.3
0.0
7.3
26.8
23.8
15.5
9.9
50.2
13.6
20.9
17.0
23.0
14.4
10.1
5.0
10.7
45.0
58.3
1.1
18.0
10.0
30.0
11.0
21.5
14.7
4.8
9.3
14.9
2.0
4.6
2.0
28.9
15.8
11.5
7.9
22.6
36.1
13.5
10.4
3.5
2.6
26.0
33.5
15.7
6.0
27.0
14.8
21.9
2001
11.1
0.0
7.0
28.9
26.8
16.8
10.6
39.4
13.8
20.5
17.0
23.0
16.8
11.7
5.0
9.1
45.0
58.2
1.5
18.0
10.0
30.0
12.0
21.0
13.2
3.7
9.3
14.7
2.0
3.5
2.7
33.6
20.8
11.0
3.7
15.6
33.5
12.5
6.7
3.5
2.7
26.0
33.5
18.8
10.3
27.0
15.2
6.8
2002
6.0
5.0
11.0
28.9
26.8
16.8
8.9
35.5
13.8
13.8
17.0
23.0
16.8
11.7
5.0
7.2
45.0
56.0
1.5
15.7
10.0
10.0
11.8
21.0
13.2
9.2
9.3
14.3
2.0
3.6
2.0
30.0
17.5
11.0
4.3
17.2
33.5
12.4
5.4
3.5
2.8
26.0
53.9
18.8
14.0
27.0
13.9
5.0
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
7.0
5.0
10.0
28.9
27.1
15.9
9.0
35.0
13.8
13.8
16.8
23.0
20.6
11.7
5.0
7.2
45.0
56.0
1.5
15.0
10.0
10.0
11.9
20.4
12.7
9.0
9.3
14.5
2.0
4.0
2.0
30.0
16.3
11.0
4.3
17.1
33.5
12.4
5.6
3.5
3.0
26.0
48.6
18.8
13.7
27.0
13.9
5.4
Current
Risk
Points
9.5 0.0
9.5 0.0
9.0 0.0
7.0 0.0
7.0 0.0
8.5 0.0
9.0 0.0
6.0 0.0
8.5 0.0
8.5 0.0
8.5 0.5
7.5 0.0
7.5 0.0
9.0 0.0
9.5 0.0
9.5 0.0
4.5 0.0
3.5 0.0
10.0 0.0
8.5 0.0
9.0 0.0
9.0 0.0
9.0 0.0
8.0 0.5
9.0 0.5
9.0 0.0
9.0 0.0
8.5 0.0
10.0 0.0
10.0 0.0
10.0 0.0
6.5 0.0
8.5 0.0
9.0 0.0
10.0 0.0
8.0 -0.5
6.0 0.0
9.0 0.0
9.5 1.0
10.0 0.0
10.0 0.0
7.0 0.0
4.5 -1.5
8.0 0.0
8.5 0.0
7.0 0.0
8.5 0.0
9.5 0.0
International Country Risk Guide
September 2003
TABLE 14
CURRENT ACCOUNT AS A PERCENTAGE OF TOTAL EXPORTS
This table lists the estimated balance of the current account of balance of payments, for the
current month and for the preceding five years, as percentage of the estimated total value of
exports of goods and services for the year in question. Risk points are awarded in proportion to
the percentage current account balance as outlined in the Guide to ICRG. The final columns in
the table show the risk points assessed for the percentage current account balance and the
change from the preceding month.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
1998
-19.9
-8.1
-47.6
-38.2
-52.1
-22.2
-5.0
-113.3
-28.5
-11.7
-0.5
-10.5
4.6
-36.6
5.0
-51.7
76.5
-0.9
-105.9
-10.2
-2.8
-17.9
14.5
-31.6
-55.6
-16.0
-7.2
-5.2
16.0
-28.8
-0.2
-3.6
-2.6
-3.5
-34.7
-13.0
-1.9
-10.7
-16.2
1999
-23.7
0.2
-31.2
-34.3
-63.6
-27.6
-6.0
-42.0
-28.2
-10.6
-4.1
-10.6
4.9
-26.1
13.2
-41.6
78.1
-10.6
-139.4
-18.6
0.4
-1.3
9.0
4.2
-103.0
-13.1
-7.9
-2.2
-19.4
-34.6
2.3
-4.0
3.5
-4.2
13.9
-7.8
-4.9
-11.6
-31.5
2000
-18.7
40.3
9.6
-22.6
-60.8
-16.1
-4.4
-7.3
-28.2
-5.1
-3.2
-10.3
3.8
-22.2
15.4
-34.6
69.0
-9.1
-167.1
-5.8
5.2
-4.3
6.9
3.4
-20.4
24.3
-9.3
-5.2
-20.5
-46.4
2.3
-6.9
2.8
-9.1
12.3
-4.2
-7.6
-12.0
1.1
2001
-15.8
34.6
-20.5
-12.2
-53.0
-9.6
-3.6
-1.9
-29.0
-4.0
-5.7
-10.7
3.1
-14.0
17.7
-31.9
64.6
-9.9
-144.3
-5.4
5.9
-5.1
5.5
-6.6
-25.5
-1.3
-9.0
-1.3
-20.0
-33.1
-4.0
-6.0
4.4
-7.8
-10.9
-1.8
-2.9
-10.0
-13.6
2002
-24.1
22.0
-8.8
18.3
-53.0
-13.5
1.1
-26.3
-29.0
-4.0
2.5
-14.0
4.7
-14.5
15.5
-10.1
59.9
-7.3
-1061.6
-14.3
3.4
-2.5
3.9
-9.0
-15.9
-1.2
-11.2
-4.2
-20.0
-49.0
-4.0
-7.6
5.0
-8.0
-15.5
0.0
-6.0
-10.0
-21.0
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
-21.1
33.7
-6.9
23.6
-53.0
-18.8
-0.4
-28.8
-29.0
-4.0
0.7
-14.0
4.2
-14.5
11.9
-2.8
54.6
-7.8
-150.4
-11.3
3.9
-0.7
1.6
-9.4
-41.7
-68.0
-9.8
-3.5
-20.0
-45.3
-4.0
-6.3
4.3
-5.9
-7.7
-4.1
-6.2
-10.0
-21.0
Current
Risk
Points
10.0 0.0
15.0 0.0
11.5 0.0
14.5 0.0
7.0 0.0
10.5 0.0
12.0 0.0
9.5 0.0
9.5 0.0
12.0 0.0
12.5 0.0
11.0 0.0
12.5 0.0
11.0 0.0
13.5 0.0
12.0 0.5
15.0 0.0
11.5 0.0
0.0 0.0
11.0 0.0
12.5 0.0
12.0 0.0
12.5 0.0
11.5 0.0
8.0 0.0
5.5 -7.0
11.5 0.0
12.0 0.0
10.0 0.0
7.5 -1.0
12.0 0.0
11.5 0.0
12.5 0.0
11.5 0.0
11.5 0.0
12.0 0.0
11.5 0.0
11.0 0.0
10.0 0.0
S-77
International Country Risk Guide
September 2003
COUNTRY
Current
09/03
14.2
5.2
-10.0
-12.5
4.2
-4.5
-24.9
-21.7
-8.2
-80.0
-15.9
-15.9
-14.6
4.6
-6.2
-25.0
0.5
9.7
10.7
4.7
-0.4
-1.0
0.3
-1.7
19.9
-6.7
-5.0
-6.0
-10.5
0.5
32.7
-19.0
-422.2
-50.0
15.1
-10.5
4.0
-28.4
-22.0
4.9
-30.0
-5.0
-6.5
-10.5
-26.0
3.5
-38.0
-9.6
10.9
4.0
-8.9
-35.3
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
S-78
1998
13.1
7.9
-26.9
-13.2
-0.8
-13.3
-15.4
-24.1
-19.4
-71.3
-13.3
-4.0
-14.3
1.7
-8.2
-4.4
-11.9
7.1
-13.7
-7.9
0.8
-3.5
5.3
-7.7
21.9
0.8
-17.4
-13.8
0.0
24.2
11.9
-16.9
-526.2
-50.0
-5.9
-23.9
4.7
-9.0
-29.9
11.1
-28.7
-4.4
-11.5
-30.9
11.0
-1.2
-32.0
-20.9
6.3
4.5
-12.0
-36.2
1999
14.4
7.5
13.4
-12.9
-2.6
-29.6
-22.4
-23.9
-17.6
-117.0
-10.8
-5.0
-23.2
4.7
-7.3
-4.1
-4.9
9.7
28.7
-8.7
0.3
-4.3
2.3
-5.0
20.4
2.8
-2.4
-2.6
-3.0
13.5
25.3
-20.3
-529.4
-45.0
27.1
-26.4
3.2
-10.0
-17.4
12.8
-28.1
-4.7
-8.8
-5.5
-24.0
-1.3
-45.6
-12.6
6.7
5.3
-18.8
-43.9
2000
14.8
4.4
4.3
-12.9
-2.7
-13.4
-27.0
-21.0
-18.8
-112.5
-14.9
-6.7
-18.2
3.1
-4.0
-27.3
-5.4
10.7
41.2
-2.6
-0.5
-1.9
-1.6
-8.2
18.9
6.8
6.2
-5.3
4.9
5.6
51.1
-19.3
-542.9
-45.0
-10.9
-12.4
3.9
-10.0
-22.5
7.4
-28.1
-4.6
-9.4
-12.4
-27.9
-3.8
-41.5
-8.6
10.6
3.0
-14.0
-28.3
2001
14.7
4.6
-1.6
-12.5
0.3
-9.1
-25.7
-23.7
-10.8
-100.0
-18.1
-8.3
-21.8
4.2
-2.9
-25.0
-8.5
10.4
22.4
-3.2
-0.8
-4.6
-0.2
-17.1
15.8
-23.0
-11.3
-8.3
3.6
4.3
36.4
-17.0
-542.9
-50.0
20.0
-13.7
4.0
-9.0
-22.5
7.0
-30.0
-5.0
-9.7
-10.5
-31.8
10.6
-41.5
-10.2
13.4
3.0
-7.2
-33.3
2002
15.9
5.2
-8.3
-12.5
5.5
1.2
-28.5
-23.8
-5.0
-80.0
-14.9
-4.3
-16.6
6.0
-5.9
-25.0
-3.3
11.0
12.1
-4.2
-0.1
-4.4
-1.8
-23.1
20.0
-6.7
-4.9
-5.5
-8.8
3.0
36.6
-19.0
-422.2
-50.0
17.5
-10.5
4.0
-28.4
-22.0
6.5
-30.0
-5.0
-7.5
-10.5
-26.0
6.8
-38.0
7.4
10.2
3.8
-11.1
-41.1
Reproduction without permission of the Publisher is strictly forbidden
Current
Risk
Points
13.5 0.0
13.0 0.0
11.0 0.0
11.0 0.0
12.5 0.0
12.0 0.0
10.0 0.0
10.0 0.0
11.5 0.0
4.0 0.0
10.5 0.0
10.5 0.0
11.0 0.0
12.5 0.0
10.5 -1.0
9.5 0.0
12.5 1.0
11.5 0.0
13.5 0.0
12.5 1.0
12.0 0.0
12.0 0.5
12.5 0.5
12.0 0.0
15.0 0.0
11.5 0.0
11.5 0.0
11.5 0.0
11.0 0.0
12.5 0.5
15.0 0.0
10.5 0.0
0.0 0.0
7.0 0.0
14.0 0.0
11.0 0.0
12.5 0.0
9.5 0.0
10.0 0.0
12.5 0.0
9.0 0.0
11.5 0.0
11.5 0.0
11.0 0.0
9.5 0.0
12.5 0.0
8.5 0.0
11.5 0.0
13.5 0.0
12.5 0.0
11.5 0.0
8.5 0.0
International Country Risk Guide
September 2003
COUNTRY
Current
09/03
-57.1
-5.1
23.7
8.3
25.3
-3.2
0.9
3.5
-9.8
5.8
-11.6
-14.5
20.7
-10.0
20.0
11.3
-10.0
-58.0
-100.0
8.7
-7.4
-9.0
-1.0
-2.9
-8.8
-6.1
-22.6
-3.5
6.8
16.7
-1.0
12.9
-75.0
4.2
-12.0
7.2
-6.1
-7.6
-20.0
6.3
15.2
-3.4
-42.3
4.2
31.8
-4.6
2.0
-63.6
-21.1
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
1998
-56.2
-36.1
0.0
-47.4
-18.5
-11.7
-1.4
-3.5
-36.1
3.5
-14.1
-17.4
-43.3
-27.3
0.2
-26.6
-11.3
-65.0
-13.0
13.9
-15.1
0.0
-100.0
-6.0
-1.7
-3.3
-70.6
-34.9
3.8
15.8
1.1
2.5
-56.1
20.3
-18.0
-21.0
-7.2
3.1
-27.7
-7.0
0.4
-1.4
-17.0
-9.9
-15.0
-8.1
5.3
-52.3
-13.6
1999
-59.3
3.3
12.0
-3.7
-7.2
-15.0
4.0
-5.2
-15.8
16.6
-28.9
-21.9
11.1
-12.0
27.4
0.7
-12.9
-65.0
0.2
10.6
-9.0
-26.7
-100.0
-1.8
-7.2
-8.2
-29.1
-7.0
4.6
16.6
3.2
5.6
-83.5
16.5
-13.8
0.6
-4.5
-2.5
-20.8
9.3
8.8
-5.6
-23.0
-11.7
14.5
7.7
-3.1
-44.1
1.1
2000
-54.7
10.9
30.1
28.4
-0.6
-9.8
14.5
-4.6
-15.2
17.0
-19.4
-25.4
33.2
-10.1
39.0
16.7
-12.9
-65.0
-129.1
8.7
-4.7
-18.8
-100.0
-1.5
-9.8
-13.5
-22.5
6.0
5.1
17.6
13.8
5.0
-85.7
10.7
-13.8
10.9
-8.6
-16.6
-19.3
7.2
26.2
-4.6
-28.8
-12.7
34.9
5.8
1.0
-56.9
-3.3
2001
-49.5
6.7
30.6
19.8
11.6
-5.4
12.7
-5.5
-10.7
9.9
-9.3
-23.1
25.3
-14.6
29.2
17.6
-10.0
-58.0
-129.1
10.9
-11.7
-9.0
-100.0
-0.8
-7.9
-3.5
-25.2
-15.7
5.6
12.4
6.7
11.7
-77.2
7.7
-12.0
10.4
-8.1
6.0
-19.3
6.1
17.5
-2.9
-30.4
-11.8
12.8
3.5
2.0
-65.8
-2.7
2002
-58.8
-6.3
28.9
12.7
-2.6
-1.7
-3.5
2.9
-10.5
9.5
-10.7
-18.9
20.7
-8.5
25.8
9.5
-10.0
-58.0
-100.0
10.8
-10.8
-9.0
-1.0
0.8
-7.2
-3.5
-30.9
-3.6
5.4
17.4
10.8
15.7
-75.0
8.9
-12.0
0.4
-7.0
-3.0
-20.0
12.4
8.9
-2.1
-38.7
8.0
25.4
-5.1
2.0
-53.5
-9.7
Reproduction without permission of the Publisher is strictly forbidden
Current
Risk
Points
6.5 0.0
11.5 0.0
14.5 0.0
13.0 0.0
15.0 0.0
12.0 0.0
12.5 0.0
12.5 0.0
11.5 0.0
13.0 0.0
11.0 0.0
11.0 0.0
14.5 0.0
11.0 -0.5
14.5 0.0
13.5 0.0
11.0 0.0
6.5 0.0
2.0 0.0
13.0 0.0
11.5 0.0
11.5 0.0
12.0 0.0
12.0 0.0
11.5 0.0
11.5 0.0
10.0 -1.0
12.0 0.0
13.0 0.0
14.0 0.0
12.0 0.0
13.5 0.0
4.5 0.0
12.5 0.0
11.0 0.0
13.0 0.0
11.5 0.0
11.5 0.0
10.0 0.0
13.0 0.0
14.0 0.0
12.0 0.0
8.0 0.0
12.5 0.0
15.0 0.0
12.0 0.0
12.5 0.0
6.0 0.0
10.0 -0.5
S-79
International Country Risk Guide
September 2003
TABLE 15
INTERNATIONAL LIQUIDITY AS MONTHS OF IMPORT COVER
This table lists estimated annual net liquidity, expressed as months of import cover, for the
current month and the preceding five years. Net liquidity is calculated as the official reserves
of the individual countries, including their official gold reserves calculated at current free
market prices, but excluding the use of IMF credits and the foreign liabilities of the monetary
authorities. Risk points are assigned to the number of months of import cover as outlined in
the Guide to ICRG. The final columns in the table show the risk points assessed for the current
months of import cover and the change from the preceding month.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
S-80
1998
0.2
6.5
-3.4
7.9
1.9
3.0
4.5
0.8
3.0
4.0
2.2
0.0
1.7
4.0
31.3
6.3
16.0
5.3
4.2
-3.1
1.4
10.6
12.9
7.3
-82.7
-1.5
-0.2
1.0
3.2
1.4
5.1
5.1
4.3
-0.7
2.8
5.6
4.6
2.5
1999
4.0
3.3
1.2
10.9
2.6
4.0
3.0
1.8
3.8
4.5
1.8
0.1
0.4
5.1
32.3
5.3
16.0
4.5
3.3
-3.2
1.6
12.0
11.6
9.2
-65.9
-0.5
0.8
-0.1
3.7
0.0
6.0
5.1
6.2
-0.3
4.8
2.9
5.7
2.4
2000
5.2
13.3
3.3
10.1
2.5
3.3
3.0
2.6
3.8
4.3
1.7
0.2
0.8
4.8
39.0
6.1
16.0
4.3
3.3
-0.5
1.6
10.8
9.2
9.5
-12.5
3.9
0.7
0.7
4.2
0.0
6.0
4.7
4.2
-0.4
2.0
2.0
4.5
2.4
2001
5.5
21.0
1.4
0.4
2.8
3.6
2.6
4.9
3.8
5.0
1.3
0.4
0.9
5.6
38.9
5.7
16.0
4.4
3.2
0.2
1.8
10.5
11.0
9.8
-5.1
0.2
1.0
2.7
4.3
0.0
5.8
4.6
4.7
0.3
1.1
2.4
4.0
2.5
2002
5.7
24.4
0.8
-8.5
2.8
3.9
2.2
2.9
3.8
5.0
2.3
0.4
1.0
5.1
34.1
1.8
16.0
6.3
3.2
2.2
2.0
11.6
12.4
10.6
-8.1
-0.3
1.3
8.5
4.3
0.0
5.8
6.9
6.9
-0.4
1.0
1.6
3.5
2.5
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
5.6
24.2
0.9
0.0
2.8
3.5
2.1
3.2
3.8
5.0
2.3
0.4
1.0
4.5
30.8
1.7
16.0
5.0
3.2
2.1
2.0
10.0
12.3
10.0
-7.4
-0.2
1.4
4.0
4.3
0.0
5.8
7.1
6.7
-0.2
1.0
2.6
3.5
2.5
Current
Risk
Points
3.0 0.0
5.0 0.0
1.0 0.0
0.0 0.0
1.5 0.0
2.0 0.0
1.5 0.0
1.5 0.0
2.0 0.0
3.0 0.0
1.5 0.0
0.0 0.0
1.0 0.5
2.5 0.0
5.0 0.0
1.0 -0.5
5.0 0.0
3.0 0.0
2.0 0.0
1.5 0.0
1.5 0.0
4.0 0.0
4.5 0.0
4.0 0.0
0.0 0.0
0.0 0.0
1.0 0.0
2.5 0.0
2.5 0.0
0.0 0.0
3.0 0.0
3.5 0.0
3.5 0.0
0.0 0.0
1.0 0.0
1.5 0.0
2.0 0.0
1.5 0.0
International Country Risk Guide
September 2003
COUNTRY
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
1998
0.0
3.9
3.2
-1.2
5.1
1.9
0.3
9.4
3.4
2.1
-0.9
-2.6
2.6
2.0
5.9
-1.3
1.6
7.9
5.1
-0.7
0.0
2.2
10.4
3.1
2.9
10.3
5.1
2.2
2.3
0.0
5.0
6.3
2.8
20.8
0.0
15.1
2.6
0.0
1.1
0.1
5.7
5.4
7.0
2.1
-1.5
0.0
5.8
5.1
0.0
1.8
1.9
4.0
1999
0.0
3.3
2.5
-1.6
4.9
2.2
0.3
8.2
3.0
1.9
-0.2
-1.3
1.9
3.6
6.5
0.2
1.8
9.2
5.8
2.0
0.0
1.1
9.0
2.2
2.4
12.3
7.1
3.1
2.9
0.0
7.0
8.8
3.3
18.4
0.0
17.6
2.7
0.0
2.0
1.9
6.0
3.1
6.8
2.3
0.0
0.0
7.0
4.9
-0.3
2.1
1.2
3.7
2000
0.0
3.0
2.5
0.8
4.9
2.0
-1.0
5.5
4.2
0.4
-0.1
-0.2
0.8
3.6
6.0
1.1
1.5
8.7
4.3
6.9
0.0
1.2
8.2
2.4
4.1
12.5
6.9
3.7
3.0
0.0
6.7
13.4
3.2
21.8
0.0
33.5
2.7
0.0
2.8
2.9
4.6
3.4
6.5
2.4
0.0
0.0
5.5
5.4
-0.6
2.4
1.1
2.5
2001
0.0
3.3
2.3
-1.3
5.0
1.9
0.2
2.2
5.2
1.1
0.0
0.2
0.3
4.0
6.4
1.7
1.4
11.4
5.7
6.5
0.0
1.4
9.1
2.3
7.4
15.2
6.0
3.8
3.6
0.0
8.5
17.3
3.4
20.2
0.0
36.5
3.0
1.0
2.7
3.0
5.3
3.2
6.0
3.2
0.5
0.0
10.1
5.5
-0.6
2.4
1.1
2.6
2002
2.1
3.7
2.4
0.4
5.0
2.0
0.9
3.4
4.8
0.4
0.0
2.4
-0.4
4.8
6.5
1.9
1.4
14.2
7.2
6.1
0.0
1.3
9.3
2.7
6.3
18.4
6.0
4.9
3.8
0.0
9.2
15.8
3.4
15.0
0.0
35.8
3.0
1.0
1.0
3.0
5.2
3.2
6.0
3.6
0.5
0.0
11.5
5.5
-0.5
2.5
1.2
2.6
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
2.1
3.5
2.4
0.0
5.0
1.9
1.0
3.4
5.2
1.0
0.0
0.5
0.5
4.2
6.0
1.7
1.4
14.0
6.0
6.3
0.0
1.2
9.0
2.6
6.0
15.0
6.0
5.0
3.5
0.0
8.9
14.1
3.4
12.0
0.0
30.0
3.0
1.0
1.0
3.0
5.4
3.2
6.0
3.6
0.5
0.0
11.4
5.5
0.0
2.5
1.5
2.6
Current
Risk
Points
1.5 0.0
2.0 0.0
1.5 0.0
0.0 0.0
3.0 0.0
1.0 0.0
1.0 0.0
2.0 0.0
3.0 0.0
1.0 0.0
0.0 0.0
0.0 0.0
0.0 0.0
2.5 0.0
3.5 0.0
1.0 0.0
2.5 0.0
4.5 0.0
3.5 0.0
3.5 0.0
0.0 0.0
1.0 0.0
4.0 0.5
1.5 0.0
3.5 0.0
5.0 0.0
3.5 0.0
3.0 0.0
2.0 0.0
0.0 0.0
3.5 -0.5
4.5 0.0
2.0 0.0
5.0 0.0
0.0 0.0
5.0 0.0
2.0 0.0
1.0 0.0
1.0 0.0
2.0 0.0
3.0 0.0
2.0 0.0
3.5 0.0
2.0 0.0
0.0 0.0
0.0 0.0
4.0 0.0
3.0 0.0
0.0 0.0
1.5 0.0
1.0 0.0
1.5 0.0
S-81
International Country Risk Guide
September 2003
COUNTRY
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
S-82
1998
-16.0
-0.3
7.1
5.8
2.6
0.0
1.0
1.0
2.5
12.2
1.7
7.2
6.1
1.6
1.4
-6.0
6.3
0.4
0.0
-21.3
9.4
1.0
5.0
0.0
0.9
5.5
3.1
-25.9
1.9
2.5
6.4
-2.9
11.4
0.1
6.4
0.7
3.1
2.6
1.3
2.5
-2.5
3.4
1.3
1.1
5.0
10.6
1.8
2.0
-18.3
-6.5
1999
-12.2
-0.7
7.4
7.0
7.9
-0.1
1.0
2.1
4.1
13.4
2.2
6.7
3.2
1.8
2.5
-1.4
8.0
0.8
0.0
-12.1
8.8
2.7
4.1
0.0
2.0
3.1
2.5
-29.8
-0.8
2.5
5.8
-2.6
12.6
0.0
6.2
1.0
4.1
3.2
2.8
3.2
-2.5
4.0
1.0
0.8
6.4
12.8
3.3
1.7
-17.9
-1.6
2000
-13.7
-0.8
11.8
7.1
6.4
-0.1
0.9
2.4
3.0
11.8
1.4
6.7
3.4
2.7
3.3
4.3
8.6
0.9
0.0
-8.4
7.5
3.5
3.6
0.0
2.0
2.8
1.1
-25.8
-2.4
2.4
6.9
-1.4
10.0
0.3
4.1
1.1
5.4
2.4
1.7
4.0
-0.6
4.6
1.4
0.7
7.0
12.0
2.6
1.6
-16.3
-1.9
2001
-12.0
-0.7
8.9
5.7
5.5
2.6
1.7
1.4
2.9
12.9
1.6
6.3
3.8
2.7
4.5
6.0
7.5
1.0
0.0
-6.1
8.3
3.0
3.7
0.0
0.8
2.7
1.9
-26.1
4.4
2.7
6.6
-1.0
14.9
0.7
5.1
1.4
6.4
2.5
-3.0
4.2
0.8
4.5
1.3
0.7
9.9
8.3
2.6
1.7
-9.0
-1.7
2002
-12.5
0.0
6.0
7.1
6.3
8.1
1.9
0.2
2.5
14.1
1.6
7.0
4.6
2.5
5.2
7.9
8.4
1.0
0.0
0.0
8.1
6.3
3.7
0.0
2.5
2.9
2.6
-10.8
4.5
3.1
7.8
-1.0
19.0
0.8
7.1
1.4
6.6
3.0
-2.7
2.3
1.6
5.2
1.1
0.8
-13.7
11.6
2.3
1.7
-7.0
-1.4
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
0.0
0.0
6.5
7.0
5.5
6.0
1.5
-0.2
2.3
13.0
1.6
6.0
4.6
2.5
5.0
7.0
7.5
1.0
0.0
0.0
8.0
5.0
3.7
0.0
2.1
2.8
2.6
-13.0
1.0
3.0
7.0
0.0
18.0
0.8
5.0
1.4
6.6
2.9
0.0
2.3
1.5
5.0
1.1
0.8
-10.9
8.0
2.2
1.7
0.0
-1.5
Current
Risk
Points
0.0 0.0
0.0 0.0
3.5 0.0
3.5 0.0
3.0 0.0
3.5 0.0
1.0 0.0
0.0 0.0
1.5 0.0
4.5 0.0
1.0 0.0
3.5 0.0
2.5 0.0
1.5 0.0
3.0 0.0
3.5 0.0
3.5 0.0
1.0 0.0
0.0 0.0
0.0 0.0
3.5 0.0
3.0 0.0
2.0 0.0
0.0 0.0
1.5 0.0
1.5 -0.5
1.5 -0.5
0.0 0.0
1.0 0.0
1.5 0.0
3.5 0.0
0.0 0.0
5.0 0.0
0.5 0.0
3.0 0.0
1.0 0.0
3.5 0.0
1.5 0.0
0.0 0.0
1.5 0.0
1.0 0.0
3.0 0.0
1.0 0.0
0.5 0.0
0.0 0.0
3.5 0.0
1.5 0.0
1.0 0.0
0.0 0.0
0.0 0.0
International Country Risk Guide
September 2003
TABLE 16
EXCHANGE RATE STABILITY
This table lists the annual percentage change in exchange rate of the national currency against
the US dollar (against the German mark in the case of the USA) for the current month and for
the preceding five years. Risk points are assigned to the current percentage change as outlined
in the Guide to ICRG. The final column in the table shows the risk points assessed for the
current percentage change in the exchange rate and the change, if any, from the previous
month’s risk points.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
1998
-1.1
-1.8
-71.5
0.0
-2.9
-18.2
-1.4
2.9
0.0
0.0
-6.9
-77.3
-1.5
-4.9
-1.1
-7.7
-1.0
-4.7
-1.1
-1.1
-7.1
-9.8
0.1
-25.0
-22.9
-1.1
-10.6
-1.1
-4.3
0.0
-0.7
-1.8
-1.5
-7.0
-36.2
0.0
0.0
-1.4
-6.1
1999
8.6
-13.3
-610.4
0.0
-6.0
2.5
0.0
-6.5
0.0
0.0
-4.6
-439.3
0.0
-5.5
-4.4
-56.3
0.0
-3.8
-4.4
-4.4
-0.1
-10.5
0.0
-23.2
-149.7
-4.4
-11.1
-4.4
-11.8
0.0
-4.9
-7.1
-4.1
-5.0
-116.4
-0.5
0.0
-7.4
-11.6
2000
-4.4
-13.0
-259.8
0.0
-0.8
-10.8
-15.5
-8.6
0.0
0.0
-6.2
-252.4
-15.5
-6.4
-15.6
-0.8
-1.2
-15.6
-15.6
-15.6
0.1
-5.2
0.0
-18.9
-442.8
-15.6
-7.9
-15.6
-16.4
0.0
-16.3
-11.7
-15.9
-2.4
-112.0
-8.4
0.0
-12.3
-3.5
2001
0.2
-2.6
-119.7
0.0
-2.9
-12.5
-3.0
-4.1
0.0
0.0
-7.0
-58.5
-3.0
-6.8
-3.0
-28.9
-3.9
-2.9
-3.0
-3.0
-4.3
-18.6
0.0
-10.1
-846.9
-3.0
-6.7
-3.0
-0.7
0.0
-1.9
1.5
-3.0
-3.3
0.0
-21.7
0.1
-4.2
-2.9
2002
5.8
-3.2
-97.3
-206.3
1.3
4.8
4.9
-4.4
0.0
0.0
-3.7
-27.5
4.9
-8.5
4.7
-23.9
5.3
4.9
4.7
4.9
-1.3
-8.5
0.0
-8.9
-67.7
4.9
-9.4
4.9
16.4
0.0
15.1
13.9
5.1
-9.8
0.0
-0.2
0.0
14.6
-1.4
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
14.3
2.6
-65.6
20.7
0.0
17.8
11.5
-0.6
0.0
0.0
-1.0
-12.1
11.5
-5.2
22.8
15.3
1.9
11.6
11.5
11.5
11.5
6.4
-0.1
-2.5
-19.5
11.5
-9.9
11.5
9.5
0.0
9.7
5.4
11.5
-83.6
0.0
-32.6
-0.1
11.5
-1.0
Current
Risk
Points
9.5 0.0
10.0 0.0
2.0 0.0
8.5 0.5
10.0 0.0
9.0 0.0
9.5 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
8.5 0.0
9.5 0.0
9.5 0.0
8.0 -0.5
9.0 -1.0
10.0 0.0
9.5 0.0
9.5 0.0
9.5 0.0
9.5 0.0
10.0 0.0
10.0 0.0
10.0 1.0
7.0 0.5
9.5 0.0
9.0 0.0
9.5 0.0
10.0 0.5
10.0 0.0
10.0 0.5
10.0 0.5
9.5 0.0
1.0 0.0
10.0 0.0
5.0 0.0
10.0 0.0
9.5 0.0
10.0 0.0
S-83
International Country Risk Guide
September 2003
COUNTRY
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
S-84
1998
-2.9
-1.1
-1.1
-4.5
-1.5
-12.9
-8.2
-5.4
-12.9
-1.1
-5.7
-0.7
-2.9
0.0
-14.8
-0.1
-13.6
-244.2
0.1
0.0
-6.4
-10.2
-1.9
-3.2
-8.2
0.0
-3.8
-2.8
0.0
-47.3
-0.7
-1.5
-1.7
0.0
4.3
0.0
-1.5
-6.9
-7.4
-39.5
-1.1
0.0
-15.4
-16.2
-44.1
-0.8
-2.2
-1.6
-7.2
-1.7
-23.5
-12.0
1999
0.0
0.0
-4.4
-10.7
0.0
-15.3
-3.4
-15.5
-6.1
-3.8
-18.3
-1.0
-6.2
-0.2
-10.6
-1.2
-4.4
21.6
-0.1
0.0
0.0
-8.9
0.0
-6.8
13.0
0.0
-52.6
-16.5
0.0
15.2
0.3
1.5
3.5
0.0
-2.7
0.0
0.0
-13.4
-89.0
3.2
-3.8
-2.9
-4.6
-95.8
-6.4
-2.1
-2.9
0.9
-20.0
0.0
-1.4
-11.6
2000
-15.5
-15.5
-15.6
-12.2
-15.5
-104.4
-19.5
-5.1
-30.6
-13.2
-2.5
-25.0
-4.4
-0.4
-19.0
-21.6
-4.4
-7.2
-0.7
0.0
-15.5
1.5
-15.5
-9.4
5.4
-0.1
-18.9
-8.3
0.0
4.9
-1.0
-6.5
2.6
0.0
-16.9
0.0
-15.6
-7.1
-40.2
0.0
-12.4
-9.6
1.1
-18.2
-25.1
-8.4
-8.3
-3.7
-10.3
-15.5
-15.7
-7.5
2001
-3.0
-3.0
-3.0
-23.4
-3.0
-31.5
0.0
-1.2
-11.7
-2.9
-2.7
-15.4
-4.3
-0.1
-1.5
-15.7
-5.0
-21.8
0.6
0.0
-3.0
-3.2
-3.0
-7.7
-12.8
0.0
-3.2
-3.1
0.0
-14.1
0.0
-3.2
-0.4
0.0
-20.4
0.0
-3.0
2.7
-71.0
0.0
-3.0
-2.8
1.2
-3.4
-2.6
-6.4
-28.5
-3.6
-25.4
-3.0
-8.8
-5.4
2002
4.9
4.9
4.9
-13.3
4.9
-10.6
4.9
0.5
-1.3
4.8
-1.8
-19.7
-6.2
0.0
10.0
17.8
-3.0
9.3
-293.9
0.0
4.9
-12.6
4.9
-5.3
-3.2
-0.1
-4.5
-0.2
0.0
3.1
1.0
7.7
0.0
0.0
-86.2
14.2
16.0
-4.4
0.0
0.0
4.8
10.7
-3.4
-6.7
0.0
2.5
0.0
1.6
0.0
4.9
9.4
-6.6
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
11.5
11.5
11.5
-32.6
11.5
-5.8
11.5
-1.3
-1.2
11.5
0.0
-37.9
-4.4
0.0
5.6
7.8
5.3
7.2
-4.6
0.0
11.5
8.1
11.5
-19.6
4.4
0.0
5.3
2.9
0.0
3.7
0.9
5.0
0.0
-5.2
-12.5
11.5
11.5
8.0
-34.8
0.0
11.5
8.8
-4.6
-3.0
-0.9
9.1
-0.2
3.9
31.0
11.5
20.5
-5.1
Current
Risk
Points
9.5 0.0
9.5 0.0
9.5 0.0
5.0 -0.5
9.5 0.0
10.0 0.0
9.5 0.0
10.0 0.0
10.0 0.0
9.5 0.0
10.0 0.0
4.5 1.0
10.0 0.5
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
9.5 0.0
10.0 0.0
9.5 0.0
7.0 0.5
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
9.5 -0.5
8.0 -2.0
9.5 0.0
9.5 0.0
10.0 0.5
5.0 -2.0
10.0 0.0
9.5 0.0
10.0 0.5
10.0 0.5
10.0 0.0
10.0 0.0
10.0 0.5
10.0 0.0
10.0 0.0
6.5 -0.5
9.5 0.0
8.5 -0.5
9.5 -0.5
International Country Risk Guide
September 2003
COUNTRY
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
1998
-14.1
0.0
-6.7
0.0
-9.8
0.0
-43.5
-25.2
-10.0
-38.8
-6.0
-2.7
0.0
-23.8
-67.8
0.0
-1.1
-15.1
-6.6
-12.7
-4.8
-4.0
0.0
-20.0
-2.0
-9.2
-27.4
0.0
-4.1
0.1
0.0
-16.6
-5.5
-31.9
-1.1
-0.7
-3.0
-71.7
-3.5
-31.6
-0.1
1.1
1.5
-10.9
-12.1
-13.6
-37.3
-41.7
-80.1
1999
-1.1
-321.9
-3.4
0.0
-9.3
0.0
-23.4
-14.4
-15.5
4.4
-14.1
0.0
0.0
-72.8
-153.7
0.0
-4.4
-12.0
-59.3
-1.3
-17.4
-9.4
0.0
-10.5
0.0
-9.6
-25.8
-114.3
-3.9
-3.6
0.0
3.5
-8.6
8.6
-4.4
0.0
-4.2
-60.6
-14.5
-68.6
0.0
-2.4
0.0
-8.3
-10.6
-5.1
-14.6
-28.2
-78.9
2000
-3.8
-10.1
-12.9
0.0
-9.2
0.0
-8.9
-11.8
-3.2
-13.1
-9.6
-15.5
0.0
-41.6
-14.3
0.0
-15.6
-4.8
-24.2
-1.7
-11.3
-33.5
0.0
-13.6
-15.5
-9.0
-1.8
-53.9
-10.9
-12.5
0.0
3.2
-19.9
-6.1
-15.6
0.0
-15.6
-49.3
-21.6
-31.7
0.0
-6.8
13.4
-6.7
-12.3
-1.6
-3.9
-30.3
-13.0
2001
-12.4
-9.4
-2.2
0.0
-15.4
0.0
-22.0
-17.8
-0.5
-15.4
5.8
-3.0
0.0
-33.9
-3.7
0.0
-3.0
-192.0
-109.8
-3.9
-5.0
-2.6
-2.5
-24.0
-3.0
-16.1
-0.6
-64.7
-12.7
0.1
0.0
-8.3
-0.6
-10.8
-3.0
1.1
-5.0
-96.0
-16.1
1.3
0.0
-5.2
3.0
-10.1
-6.4
-3.9
-4.3
-16.1
-26.9
2002
0.0
-8.4
11.2
0.0
3.6
0.0
-15.2
-39.2
-0.3
-1.2
0.3
4.9
0.0
-13.7
-7.5
0.0
4.8
8.7
0.0
0.1
6.3
11.8
0.0
-22.4
4.9
-7.0
-1.8
-7.7
5.7
7.6
0.0
-2.3
0.0
3.3
4.8
-0.3
1.2
-23.0
0.0
0.8
0.0
4.0
-5.4
-59.6
-60.4
-3.8
-4.1
-21.8
0.0
Reproduction without permission of the Publisher is strictly forbidden
Current
09/03
11.5
-1.3
0.3
0.0
2.3
0.0
15.3
2.9
4.2
-5.4
5.2
11.5
0.0
-0.4
4.2
0.0
11.5
5.6
-15.0
1.9
13.2
8.8
0.0
31.0
11.5
-0.6
-1.0
-15.4
9.9
6.8
5.8
1.6
-6.7
4.0
11.5
-1.3
6.3
15.9
-10.3
0.0
0.0
2.1
-13.0
2.9
-9.3
-1.2
-0.9
-4.4
-1386.0
Current
Risk
Points
9.5 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
9.0 -0.5
10.0 0.0
10.0 0.0
9.5 -0.5
10.0 0.0
9.5 0.0
10.0 0.0
10.0 0.0
10.0 0.0
10.0 0.0
9.5 0.0
10.0 0.0
7.5 0.0
10.0 0.0
9.5 0.5
10.0 0.5
10.0 0.0
6.5 -0.5
9.5 0.0
10.0 0.0
10.0 0.0
7.5 0.0
10.0 0.5
10.0 0.0
10.0 0.0
10.0 0.0
9.5 0.5
10.0 0.0
9.5 0.0
10.0 0.0
10.0 0.0
9.0 0.0
8.5 0.0
10.0 0.0
10.0 0.0
10.0 0.0
8.0 0.5
10.0 0.0
9.0 1.0
10.0 0.0
10.0 0.0
10.0 0.5
0.0 0.0
S-85
International Country Risk Guide
September 2003
TABLE 17
FOREIGN EXCHANGE RATES
This table presents the average monthly exchange rate for the countries listed against the US
dollar (against Euro in the case of the USA) for the month one year ago and for the six
months preceding the current issue.
COUNTRY
Albania
Algeria
Angola
Argentina
Armenia
Australia
Austria
Azerbaijan
Bahamas
Bahrain
Bangladesh
Belarus
Belgium
Bolivia
Botswana
Brazil
Brunei
Bulgaria
Burkina Faso
Cameroon
Canada
Chile
China, Peoples' Rep.
Colombia
Congo, Dem. Republic
Congo, Republic
Costa Rica
Cote d'Ivoire
Croatia
Cuba
Cyprus
Czech Republic
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
France
Gabon
Gambia
Germany
Ghana
Greece
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
S-86
Currency
Lek
Dinar
Kwanza
Peso
Dram
Dollar
Schilling
Manat
Dollar
Dinar
Taka
Ruble
Franc
Boliviano
Pula
Real
Dollar
Lev
CFA Fr
CFA Fr
Dollar
Peso
Ren.Yuan
Peso
Franc
CFA Fr
Colon
CFA Fr
Kuna
Peso
Pound
Koruna
Krone
Peso
Sucre
Pound
Colon
Kroon
Birr
Markka
Franc
CFA Fr
Dalasi
D.mark
Cedi
Drachma
Questzal
Franc
CFA Fr
Dollar
Gourde
Lempira
Dollar
Forint
Krona
09/02
139.30
79.10
48.15
3.67
558.14
1.84
1.02
4886.00
1.00
0.38
57.85
1866.50
1.02
7.34
6.34
3.55
1.78
1.98
666.79
666.79
1.58
750.80
8.27
2792.25
361.50
666.79
367.92
666.79
7.45
21.00
0.58
30.84
7.55
17.10
1.00
4.63
8.75
15.90
8.46
1.02
1.02
666.79
22.25
1.02
8150.00
1.02
7.82
1976.50
666.79
179.00
28.00
16.65
7.80
247.23
87.13
03/03
129.47
79.74
66.55
3.14
558.14
1.68
0.93
4903.00
1.00
0.38
58.20
1989.50
0.93
7.59
5.27
3.39
1.76
1.81
609.42
609.42
1.48
740.15
8.28
2959.47
418.00
609.42
386.62
609.42
7.12
21.00
0.54
29.38
6.90
22.85
1.00
5.69
8.75
14.54
8.30
0.93
0.93
609.42
24.50
0.93
8340.00
0.93
7.89
1980.00
609.42
179.00
40.50
17.08
7.80
227.10
78.29
04/03
130.22
79.69
69.46
2.97
558.14
1.65
0.93
4908.00
1.00
0.38
58.20
2011.00
0.93
7.61
5.07
3.13
1.78
1.80
607.96
607.96
1.45
718.75
8.28
2919.60
415.50
607.96
389.99
607.96
6.96
21.00
0.54
29.21
6.88
22.00
1.00
5.86
8.75
14.51
8.75
0.93
0.93
607.96
25.00
0.93
8635.00
0.93
7.85
1980.00
607.96
179.00
40.50
17.17
7.80
227.35
77.08
05/03
120.12
79.51
72.47
2.97
558.14
1.52
0.86
4914.00
1.00
0.38
58.10
2035.00
0.86
7.62
5.04
2.97
1.73
1.67
561.29
561.29
1.36
708.95
8.28
2861.50
416.00
561.29
393.86
561.29
6.43
21.00
0.50
26.86
6.35
25.80
1.00
5.96
8.75
13.39
8.58
0.86
0.86
561.29
25.00
0.86
8635.00
0.86
7.91
1980.00
561.29
179.00
38.75
17.23
7.80
209.76
73.03
06/03
118.885
78.56
75.30
2.80
558.14
1.49
0.86
4921.00
1.00
0.38
58.35
2059.25
0.86
7.65
5.08
2.88
1.73
1.66
561.05
561.05
1.34
705.65
8.28
2826.15
317.88
561.05
397.36
561.05
6.45
21.00
0.50
26.87
6.35
27.10
1.00
5.99
8.75
13.38
8.45
0.86
0.86
561.05
26.00
0.86
8650.00
0.86
7.94
1985.00
561.05
179.00
38.15
17.30
7.80
228.59
73.37
Reproduction without permission of the Publisher is strictly forbidden
07/03
122.29
78.01
78.25
2.79
558.14
1.53
0.89
4921.00
1.00
0.38
58.36
2071.50
0.89
7.68
5.03
2.86
1.76
1.74
586.54
586.54
1.40
698.25
8.28
2889.07
430.00
586.54
400.75
586.54
6.69
21.00
0.53
28.53
6.65
32.10
1.00
6.15
8.75
13.99
8.45
0.89
0.89
586.54
26.00
0.89
8685.00
0.89
7.93
1987.50
586.54
179.00
40.00
17.37
7.80
236.84
78.07
08/03
119.34
77.01
79.76
2.91
558.14
1.51
0.90
4915.00
1.00
0.38
58.40
2092.75
0.90
7.72
4.89
3.01
1.75
1.75
589.81
589.81
1.40
702.95
8.28
2863.15
432.00
589.81
404.24
589.81
6.74
21.00
0.53
29.16
6.68
31.40
1.00
6.15
8.75
14.07
8.55
0.90
0.90
589.81
29.50
0.90
8625.00
0.90
7.93
2000.00
589.81
179.00
38.60
17.39
7.80
233.28
80.37
International Country Risk Guide
COUNTRY
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Jamaica
Japan
Jordan
Kazakhstan
Kenya
Korea, D.P.R.
Korea, Republic
Kuwait
Latvia
Lebanon
Liberia
Libya
Lithuania
Luxembourg
Madagascar
Malawi
Malaysia
Mali
Malta
Mexico
Moldova
Mongolia
Morocco
Mozambique
Myanmar
Namibia
Netherlands
New Zealand
Nicaragua
Niger
Nigeria
Norway
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russian Federation.
Saudi Arabia
Senegal
Serbia & Montenegro
Sierra Leone
Singapore
Slovak Republic
Slovenia
Somalia
South Africa
Spain
Sri Lanka
Sudan
Suriname
Sweden
Switzerland
Syria
Currency
Rupee
Rupiah
Rial
Dinar
Punt
Shekel
Lira
Dollar
Yen
Dinar
Tenge
Shilling
Won (N)
Won (S)
Dinar
Lats
Pound
Dollar
Dinar
Litas
Franc
Franc
Kwacha
Ringgit
CFA Fr
Lira
Peso
Leu
Tugrik
Dirham
Metical
Kyat
Dollar
Guilder
Dollar
Cordoba
CFA Fr
Naira
Krone
Rial
Rupee
Balboa
Kina
Guarani
Sol
Peso
Zloty
Escudo
Riyal
Leu
Ruble
Riyal
CFA Fr
Dinar
Leone
Dollar
Koruna
Tolar
Shilling
Rand
Peseta
Rupee
Dinar
Guilder
Krona
Franc
Pound
09/02
48.39
9075.00
7948.00
0.31
1.02
4.85
1.02
48.70
123.78
0.71
154.66
78.85
2.20
1220.65
0.30
0.60
1514.00
71.30
1.24
3.51
1.02
6480.00
79.80
3.80
666.79
0.42
10.36
13.58
1116.00
10.67
23285.50
6.45
10.66
1.02
2.13
14.43
666.79
128.70
7.47
0.39
59.19
1.00
4.01
6255.00
3.63
52.33
4.14
1.02
3.64
33205.00
31.65
3.75
666.79
62.18
2045.00
1.78
43.43
231.94
2620.00
10.66
1.02
96.23
258.70
2178.50
9.22
1.49
48.85
September 2003
03/03
47.65
8917.50
8033.00
0.31
0.93
4.81
0.93
53.20
118.54
0.71
150.92
76.47
2.20
1241.35
0.30
0.58
1513.62
71.30
1.20
3.21
0.93
5900.00
89.80
3.80
609.42
0.39
10.83
14.39
1126.00
9.96
23435.00
6.25
8.22
0.93
1.82
14.74
609.42
129.60
7.22
0.39
57.81
1.00
3.53
6900.00
3.48
54.83
4.01
0.93
3.64
32934.00
31.39
3.75
609.42
58.51
2270.00
1.76
38.74
210.50
2620.00
8.22
0.93
96.93
263.55
2515.00
8.55
1.36
46.00
04/03
47.34
8842.50
8150.00
0.31
0.93
4.59
0.93
56.25
120.22
0.71
151.80
75.70
2.20
1217.45
0.30
0.58
1509.00
71.30
1.21
3.20
0.93
6050.00
90.30
3.80
607.96
0.39
10.64
14.77
1135.00
9.95
23352.00
6.20
7.68
0.93
1.82
14.79
607.96
131.25
7.27
0.39
57.77
1.00
3.77
6855.00
3.46
52.38
3.93
0.93
3.64
33885.50
31.19
3.75
607.96
59.59
2295.00
1.78
37.95
215.40
2620.00
7.68
0.93
97.03
263.55
2515.00
8.49
1.39
46.00
05/03
46.94
8410.00
8146.00
0.31
0.86
4.52
0.86
64.00
116.59
0.71
151.15
71.50
2.20
1192.90
0.30
0.56
1514.00
75.00
1.21
2.95
0.86
6200.00
90.70
3.80
561.29
0.37
10.34
14.15
1126.00
9.33
23352.50
6.20
7.90
0.86
1.71
14.79
561.29
129.85
6.81
0.39
57.79
1.00
3.59
6150.00
3.48
52.43
3.72
0.86
3.64
32262.50
30.89
3.75
561.29
56.61
2250.00
1.73
35.13
199.50
2620.00
7.90
0.86
97.23
258.70
2515.00
7.85
1.30
46.00
06/03
46.59
8232.00
8157.00
0.31
0.86
4.39
0.86
58.20
118.52
0.71
148.47
73.90
2.20
1184.95
0.30
0.56
1513.50
80.00
1.21
2.95
0.86
5750.00
89.60
3.80
561.05
0.37
10.56
14.16
1126.00
9.32
23346.50
6.20
7.93
0.86
1.71
14.95
561.05
131.50
7.00
0.39
57.75
1.00
3.51
6230.00
3.47
53.43
3.77
0.86
3.64
32717.50
30.38
3.75
561.05
55.57
2250.00
1.73
35.63
199.95
2620.00
7.93
0.86
97.19
258.70
2515.00
7.76
1.32
46.00
Reproduction without permission of the Publisher is strictly forbidden
07/03
46.22
8258.50
8230.00
0.31
0.89
4.43
0.89
58.34
118.76
0.71
146.41
74.75
2.20
1179.00
0.30
0.57
1514.00
80.00
1.21
3.09
0.89
5900.00
89.60
3.80
586.54
0.38
10.35
14.01
1126.00
9.66
23332.50
6.20
7.73
0.89
1.72
15.04
586.54
129.85
7.48
0.39
57.75
1.00
3.45
5820.00
3.47
53.58
4.01
0.89
3.64
32742.50
30.45
3.75
586.54
58.25
2352.50
1.76
37.40
209.67
2620.00
7.73
0.89
97.13
258.70
2515.00
8.26
1.37
46.00
08/03
45.82
8418.00
8311.00
0.31
0.90
4.45
0.90
58.26
118.28
0.71
146.47
76.55
2.20
1175.55
0.30
0.57
1514.12
75.00
1.39
3.10
0.90
5960.00
107.60
3.80
589.81
0.38
10.84
13.99
1126.00
9.70
23330.50
6.20
7.35
0.90
1.70
15.16
589.81
130.35
7.45
0.39
57.83
1.00
3.40
6075.00
3.48
55.18
3.92
0.90
3.64
33327.50
30.32
3.75
589.81
58.72
2352.50
1.75
37.70
211.46
2620.00
7.35
0.90
96.86
261.30
2515.00
8.31
1.39
46.00
S-87
International Country Risk Guide
COUNTRY
Taiwan
Tanzania
Thailand
Togo
Trinidad & Tobago
Tunisia
Turkey
Uganda
Ukraine
United Arab Emirates
United Kingdom
United States
Uruguay
Venezuela
Vietnam
Yemen, Republic
Zambia
Zimbabwe
S-88
Currency
Dollar
Shilling
Baht
CFA Fr
Dollar
Dinar
Lira
Shilling
Hryvna
Dirham
Pound
Dollar
Peso
Bolivar
Dong
Rial
Kwacha
Dollar
09/02
34.82
977.00
43.38
666.79
6.07
1.39
1659250.00
1814.00
5.33
3.67
0.64
0.98
28.50
1461.76
15339.50
176.39
4500.00
55.45
September 2003
03/03
34.70
1040.00
42.75
609.42
6.13
1.32
1635500.00
1915.00
5.34
3.67
0.63
1.08
28.68
1598.00
15440.00
177.89
5025.00
824.00
04/03
34.81
1047.00
42.92
607.96
6.15
1.33
1621000.00
1967.50
5.33
3.67
0.64
1.08
28.48
1598.00
15462.50
177.89
4857.50
824.00
05/03
06/03
07/03
08/03
34.54
34.43
34.25
34.61
1049.50
1046.00
1042.50
1050.50
41.61
41.68
41.65
42.04
561.29
561.05
586.54
589.81
6.14
6.14
6.15
6.14
1.26
1.30
1.30
1.27
1505000.00 1419500.00 1378000.00 1395750.00
1990.00
1994.25
2001.50
2003.00
5.34
5.33
5.33
5.33
3.67
3.67
3.67
3.67
0.60
0.63
0.63
0.61
1.17
1.12
1.11
1.17
26.39
26.72
27.68
29.43
1598.00
1598.00
1598.00
1598.00
15483.50
15515.00
15520.50
15467.00
178.01
178.01
178.01
178.01
4767.50
4755.00
4700.00
4790.00
824.00
824.00
824.00
824.00
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International Country Risk Guide
September 2003
BRIEF GUIDE
TO THE
RATINGS SYSTEM
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International Country Risk Guide
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September 2003
International Country Risk Guide
September 2003
THE RATING SYSTEM
The ICRG Risk Rating System assigns a numerical value (risk points) to a predetermined range
of risk components, according to a preset weighted scale, for each country covered by the system.
Each scale is designed to award the highest value to the lowest risk and the lowest value to the
highest risk. All countries are assessed on the same basis to allow for comparability.
The risk components are grouped into three Risk Categories – Political, Economic, and Financial.
Each Risk Category is made up of a number of Risk Components. The sum of the Risk Points
assigned to each Risk Component within each Risk Category determines the overall risk rating
for that Risk Category.
The total Risk Points for each Risk Category are further combined, according to a formula, to
produce a Composite Risk Rating for the country in question. In every case, the higher the
number of Risk Points awarded, the lower the perceived risk, while the lower the number of Risk
Points awarded, the higher the perceived risk.
The risk ratings are produced as a current situation (the current month) assessment, and as oneyear and five-year forecasts.
THE POLITICAL RISK RATING
The aim of the political risk rating is to provide a means of assessing the political stability of the
countries covered by ICRG on a comparable basis. This is done by assigning risk points to a preset group of factors, termed political risk components. The minimum number of points that can
be assigned to each component is zero, while the maximum number of points depends on the
fixed weight that component is given in the overall political risk assessment. In every case the
lower the risk point total, the higher the risk, and the higher the risk point total the lower the risk.
To ensure consistency, both between countries and over time, points are assigned by ICRG
editors on the basis of a series of pre-set questions for each risk component.
THE POLITICAL RISK COMPONENTS – Table 3B
The following risk components, weights, and sequence are used to produce the political risk
rating:
POLITICAL RISK COMPONENTS
Sequence
Component
Points
(max.)
A
Government Stability
12
B
Socioeconomic Conditions
12
C
Investment Profile
12
D
Internal Conflict
12
E
External Conflict
12
F
Corruption
6
G
Military in Politics
6
H
Religion in Politics
6
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International Country Risk Guide
September 2003
POLITICAL RISK COMPONENTS
Sequence
Component
Points
(max.)
I
Law and Order
6
J
Ethnic Tensions
6
K
Democratic Accountability
6
L
Bureaucracy Quality
4
Total
100
Government Stability – 12 Points
This is an assessment both of the government’s ability to carry out its declared program(s), and its
ability to stay in office. The risk rating assigned is the sum of three subcomponents, each with a
maximum score of four points and a minimum score of 0 points. A score of 4 points equates to
Very Low Risk and a score of 0 points to Very High Risk.
The subcomponents are:
•
•
•
Government Unity
Legislative Strength
Popular Support
Socioeconomic conditions – 12 Points
This is an assessment of the socioeconomic pressures at work in society that could constrain
government action or fuel social dissatisfaction. The risk rating assigned is the sum of three
subcomponents, each with a maximum score of four points and a minimum score of 0 points. A
score of 4 points equates to Very Low Risk and a score of 0 points to Very High Risk.
The subcomponents are:
•
•
•
Unemployment
Consumer Confidence
Poverty
Investment Profile – 12 Points
This is an assessment of factors affecting the risk to investment that are not covered by
other political, economic and financial risk components. The risk rating assigned is the sum
of three subcomponents, each with a maximum score of four points and a minimum score of 0
points. A score of 4 points equates to Very Low Risk and a score of 0 points to Very High Risk.
The subcomponents are:
•
•
•
Contract Viability/Expropriation
Profits Repatriation
Payment Delays
Internal Conflict – 12 Points
This is an assessment of political violence in the country and its actual or potential impact on
governance. The highest rating is given to those countries where there is no armed opposition to
the government and the government does not indulge in arbitrary violence, direct or indirect,
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International Country Risk Guide
September 2003
against its own people. The lowest rating is given to a country embroiled in an on-going civil
war.
The risk rating assigned is the sum of three subcomponents, each with a maximum score of four
points and a minimum score of 0 points. A score of 4 points equates to Very Low Risk and a
score of 0 points to Very High Risk.
The subcomponents are:
•
•
•
Civil War
Terrorism/Political Violence
Civil Disorder
External Conflict – 12 Points
The external conflict measure is an assessment both of the risk to the incumbent government from
foreign action, ranging from non-violent external pressure (diplomatic pressures, withholding of
aid, trade restrictions, territorial disputes, sanctions, etc) to violent external pressure (cross-border
conflicts to all-out war).
External conflicts can adversely affect foreign business in many ways, ranging from restrictions
on operations, to trade and investment sanctions, to distortions in the allocation of economic
resources, to violent change in the structure of society.
The risk rating assigned is the sum of three subcomponents, each with a maximum score of four
points and a minimum score of 0 points. A score of 4 points equates to Very Low Risk and a
score of 0 points to Very High Risk.
The subcomponents are:
•
•
•
War
Cross-Border Conflict
Foreign Pressures
Corruption – 6 Points
This is an assessment of corruption within the political system. Such corruption is a threat to
foreign investment for several reasons: it distorts the economic and financial environment, it
reduces the efficiency of government and business by enabling people to assume positions of
power through patronage rather than ability, and, last but not least, introduces an inherent
instability into the political process.
The most common form of corruption met directly by business is financial corruption in the form
of demands for special payments and bribes connected with import and export licenses, exchange
controls, tax assessments, police protection, or loans. Such corruption can make it difficult to
conduct business effectively, and in some cases my force the withdrawal or withholding of an
investment.
Although our measure takes such corruption into account, it is more concerned with actual or
potential corruption in the form of excessive patronage, nepotism, job reservations, 'favor-forfavors', secret party funding, and suspiciously close ties between politics and business. In our
view these insidious sorts of corruption are potentially of much greater risk to foreign business in
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International Country Risk Guide
September 2003
that they can lead to popular discontent, unrealistic and inefficient controls on the state economy,
and encourage the development of the black market.
The greatest risk in such corruption is that at some time it will become so overweening, or some
major scandal will be suddenly revealed, as to provoke a popular backlash, resulting in a fall or
overthrow of the government, a major reorganizing or restructuring of the country's political
institutions, or, at worst, a breakdown in law and order, rendering the country ungovernable.
Military in Politics – 6 Points
The military is not elected by anyone. Therefore, its involvement in politics, even at a peripheral
level, is a diminution of democratic accountability. However, it also has other significant
implications.
The military might, for example, become involved in government because of an actual or created
internal or external threat. Such a situation would imply the distortion of government policy in
order to meet this threat, for example by increasing the defense budget at the expense of other
budget allocations.
In some countries, the threat of military take-over can force an elected government to change
policy or cause its replacement by another government more amenable to the military’s wishes.
A military takeover or threat of a takeover may also represent a high risk if it is an indication that
the government is unable to function effectively and that the country therefore has an uneasy
environment for foreign businesses.
A full-scale military regime poses the greatest risk. In the short term a military regime may
provide a new stability and thus reduce business risks. However, in the longer term the risk will
almost certainly rise, partly because the system of governance will be become corrupt and partly
because the continuation of such a government is likely to create an armed opposition.
In some cases, military participation in government may be a symptom rather than a cause of
underlying difficulties. Overall, lower risk ratings indicate a greater degree of military
participation in politics and a higher level of political risk.
Religious Tensions – 6 Points
Religious tensions may stem from the domination of society and/or governance by a single
religious group that seeks to replace civil law by religious law and to exclude other religions from
the political and/or social process; the desire of a single religious group to dominate governance;
the suppression off religious freedom; the desire of a religious group to express its own identity,
separate from the country as a whole.
The risk involved in these situations range from inexperienced people imposing inappropriate
policies through civil dissent to civil war.
Law and Order – 6 Points
Law and Order are assessed separately, with each sub-component comprising zero to three points.
The Law sub-component is an assessment of the strength and impartiality of the legal system,
while the Order sub-component is an assessment of popular observance of the law. Thus, a
country can enjoy a high rating – 3 – in terms of its judicial system, but a low rating - 1 – if it
suffers from a very high crime rate of if the law is routinely ignored without effective sanction
(for example, widespread illegal strikes).
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September 2003
Ethnic Tensions – 6 Points
This component is an assessment of the degree of tension within a country attributable to racial,
nationality, or language divisions. Lower ratings are given to countries where racial and
nationality tensions are high because opposing groups are intolerant and unwilling to
compromise. Higher ratings are given to countries where tensions are minimal, even though such
differences may still exist.
Democratic Accountability – 6 Points
This is a measure of how responsive government is to its people, on the basis that the less
responsive it is, the more likely it is that the government will fall, peacefully in a democratic
society, but possibly violently in a non-democratic one.
The points in this component are awarded on the basis of the type of governance enjoyed by the
country in question. For this purpose, we have defined the following types of governance:
Alternating Democracy
The essential features of an alternating democracy are:
• A government/executive that has not served more than two successive terms.
• Free and fair elections for the legislature and executive as determined by constitution or
statute;
• The active presence of more than one political party and a viable opposition;
• Evidence of checks and balances among the three elements of government: executive,
legislative and judicial;
• Evidence of an independent judiciary;
• Evidence of the protection of personal liberties through constitutional or other legal
guarantees.
Dominated Democracy
The essential features of a dominated democracy are:
• A government/executive that has served more than two successive terms.
• Free and fair elections for the legislature and executive as determined by constitution or
statute;
• The active presence of more than one political party
• Evidence of checks and balances between the executive, legislature, and judiciary;
• Evidence of an independent judiciary;
• Evidence of the protection of personal liberties.
De-facto One-Party State
The essential features of a de-facto one-party state are:
• A government/executive that has served more than two successive terms, or where the
political/electoral system is designed or distorted to ensure the domination of governance by a
particular government/executive.
• Holding of regular elections as determined by constitution or statute
• Evidence of restrictions on the activity of non-government political parties
(disproportionate media access between the governing and non-governing parties, harassment
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International Country Risk Guide
September 2003
of the leaders and/or supporters of non-government political parties, the creation impediments
and obstacles affecting only the non-government political parties, electoral fraud, etc).
De jure One-Party state
The identifying feature of a one-party state is:
•
•
A constitutional requirement that there be only one governing party.
Lack of any legally recognized political opposition.
Autarchy
The identifying feature of an autarchy is:
• Leadership of the state by a group or single person, without being subject to any
franchise, either through military might or inherited right.
In an autarchy, the leadership might indulge in some quasi-democratic processes. In its most
developed form this allows competing political parties and regular elections, through popular
franchise, to an assembly with restricted legislative powers (approaching the category of a de jure
or de facto one party state). However, the defining feature is whether the leadership, i.e. the head
of government, is subject to election in which political opponents are allowed to stand.
In general, the highest number of risk points (lowest risk) are assigned to Alternating
Democracies, while the lowest number of risk points (highest risk) are assigned to autarchies.
Bureaucracy Quality – 4 Points
The institutional strength and quality of the bureaucracy is another shock absorber that tends to
minimize revisions of policy when governments change. Therefore, high points are given to
countries where the bureaucracy has the strength and expertise to govern without drastic changes
in policy or interruptions in government services. In these low-risk countries, the bureaucracy
tends to be somewhat autonomous from political pressure and to have an established mechanism
for recruitment and training. Countries that lack the cushioning effect of a strong bureaucracy
receive low points because a change in government tends to be traumatic in terms of policy
formulation and day-to-day administrative functions.
ASSESSING POLITICAL RISK
In general terms if the points awarded are less than 50% of the total, that component can be
considered as very high risk. If the points are in the 50-60% range as high risk, in the 60%-70%
range as moderate risk, in the 70-80% range as low risk and in the 80-100% range as very low
risk. However, this is only a general guideline as a better rating in other components can
compensate for a poor risk rating in one component.
Overall, a political risk rating of 0.0% to 49.9% indicates a Very High Risk; 50.0% to 59.9%
High Risk; 60.0% to 69.9% Moderate Risk; 70.0% to 79.9% Low Risk; and 80.0% or more Very
Low Risk. Once again, however, a poor political risk rating can be compensated for by a better
financial and/or economic risk rating.
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International Country Risk Guide
September 2003
THE ECONOMIC RISK RATING
The overall aim of the Economic Risk Rating is to provide a means of assessing a country’s
current economic strengths and weaknesses. In general terms where its strengths outweigh its
weaknesses it will present a low economic risk and where its weaknesses outweigh its strengths it
will present a high economic risk.
These strengths and weaknesses are assessed by assigning risk points to a pre-set group of factors,
termed economic risk components. The minimum number of points that can be assigned to each
component is zero, while the maximum number of points depends on the fixed weight that
component is given in the overall economic risk assessment. In every case the lower the risk
point total, the higher the risk, and the higher the risk point total the lower the risk.
To ensure comparability between countries the components are based on accepted ratios between
measured data within the national economic/financial structure. It is the ratios that are compared,
not the data themselves. The points assigned to each component (ratio) are taken from a fixed
scale.
ASSESSING ECONOMIC RISK
As noted above, points are awarded to each risk component on a scale from zero up to a pre-set
maximum. In general terms if the points awarded are less than 50% of the total, that component
can be considered as very high risk. If the points are in the 50-60% range as high risk, in the
60%-70% range as moderate risk, in the 70-80% range as low risk, and in the 80-100% range as
very low risk. However, this is only a general guideline as a better rating in other components
can compensate for a poor risk rating in one component.
Overall, an economic risk rating of 0.0% to 24.5% indicates a Very High Risk; 25.0% to 29.9%
High Risk; 30.0% to 34.9% Moderate Risk; 35.0% to 39.9% Low Risk; and 40.0% or more Very
Low Risk. Once again, however, a poor economic risk rating can be compensated for by a better
political and/or financial risk rating.
THE ECONOMIC RISK COMPONENTS – TABLE 5B
GDP Per Head – Table 7
The estimated GDP per head for a given year, converted into US dollars at the average exchange
rate for that year, is expressed as a percentage of the average of the estimated total GDP of all the
countries covered by ICRG. The risk points are then assigned according to the following scale:
GDP Per Head
% of average
Points
250.0 plus
5.0
200.0 to 249.9
4.5
150.0 to 199.9
4.0
100.0 to 149.9
3.5
75.0 to 99.9
3.0
50.0 to 74.9
2.5
40.0 to 49.9
2.0
30.0 to 39.9
1.5
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International Country Risk Guide
September 2003
GDP Per Head
% of average
Points
20.0 to 29.9
1.0
10.0 to 19.9
0.5
Up to 9.9
0.0
Real GDP Growth – Table 8
The annual change in the estimated GDP, at constant 1990 prices, of a given country is expressed
as a percentage increase or decrease. The risk points are then assigned according to the following
scale:
Real GDP Growth
Change (%)
Points
6.0 plus
10.0
5.0 to 5.9
9.5
4.0 to 4.9
9.0
3.0 to 3.9
8.5
2.5 to 2.9
8.0
2.0 to 2.4
7.5
1.5 to 1.9
7.0
1.0 to 1.4
6.5
0.5 to 0.9
6.0
0.0 to 0.4
5.5
-0.1 to -0.4
5.0
-0.5 to -0.9
4.5
-1.0 to -1.4
4.0
-1.5 to -1.9
3.5
-2.0 to -2.4
3.0
-2.5 to -2.9
2.5
-3.0 to -3.4
2.0
-3.5 to -3.9
1.5
-4.0 to -4.9
1.0
-5.0 to -5.9
0.5
-6.0 plus
0.0
Annual Inflation Rate – Table 9
The estimated annual inflation rate (the unweighted average of the Consumer Price Index) is
calculated as a percentage change. The risk points are then assigned according to the following
scale:
Annual Inflation Rate
Change (%)
Points
0.0 to 1.9
10.0
2.0 to 2.9
9.5
3.0 to 3.9
9.0
4.0 to 5.9
8.5
6.0 to 7.9
8.0
8.0 to 9.9
7.5
10.0 to 11.9
7.0
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International Country Risk Guide
September 2003
Annual Inflation Rate
Change (%)
Points
12.0 to 13.9
6.5
14.0 to 15.9
6.0
16.0 to 18.9
5.5
19.0 to 21.9
5.0
22.0 to 24.9
4.5
25.0 to 30.9
4.0
31.0 to 40.9
3.5
41.0 to 50.9
3.0
51.0 to 65.9
2.5
66.0 to 80.9
2.0
81.0 to 95.9
1.5
96.0 to 110.9
1.0
111.0 to 129.9
0.5
130.0 plus
0.0
Budget Balance as a Percentage of GDP – Table 10
The estimated general government budget balance (excluding grants) for a given year in the
national currency is expressed as a percentage of the estimated GDP for that year in the national
currency. The risk points are then assigned according to the following scale:
Budget Balance
% GDP
Points
4.0 plus
10.0
3.0 to 3.9
9.5
2.0 to 2.9
9.0
1.0 to 1.9
8.5
0.0 to 0.9
8.0
-0.1 to -0.9
7.5
-1.0 to -1.9
7.0
-2.0 to -2.9
6.5
-3.0 to -3.9
6.0
-4.0 to -4.9
5.5
-5.0 to -5.9
5.0
-6.0 to -6.9
4.5
-7.0 to -7.9
4.0
-8.0 to -8.9
3.5
-9.0 to -9.9
3.0
-10.0 to -11.9
2.5
-12.0 to -14.9
2.0
-15.0 to -19.9
1.5
-20.0 to -24.9
1.0
-25.0 to -29.9
0.5
-30.0 plus
0.0
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International Country Risk Guide
September 2003
Current Account as a Percentage of GDP – Table 11
The estimated balance on the current account of the balance of payments for a given year,
converted into US dollars at the average exchange rate for that year, is expressed as a percentage
of the estimated GDP of the country concerned, converted into US dollars at the average rate of
exchange for the period covered. The risk points are then assigned according to the following
scale:
Current Account % GDP
% GDP
10.0 plus
8.0 to 9.9
6.0 to 7.9
4.0 to 5.9
2.0 to 3.9
1.0 to 1.9
0.0 to 0.9
-0.1 to -0.9
-1.0 to -1.9
-2.0 to -3.9
-4.0 to -5.9
-6.0 to -7.9
-8.0 to -9.9
-10.0 to -11.9
-12.0 to -13.9
-14.0 to -15.9
-16.0 to -16.9
-17.0 to -17.9
-18.0 to -18.9
-19.0 to -19.9
-20.0 to -20.9
-21.0 to -21.9
-22.0 to -22.9
-23.0 to -23.9
-24.0 to -24.9
-25.0 to -26.9
-27.0 to -29.9
-30.0 to -32.5
-32.5 to -34.9
-35.0 to -39.9
-40.0 plus
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Points
15.0
14.5
14.0
13.5
13.0
12.5
12.0
11.5
11.0
10.5
10.0
9.5
9.0
8.5
8.0
7.5
7.0
6.5
6.0
5.5
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
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International Country Risk Guide
September 2003
THE FINANCIAL RISK RATING
The overall aim of the Financial Risk Rating is to provide a means of assessing a country’s ability
to pay its way. In essence, this requires a system of measuring a country’s ability to finance its
official, commercial, and trade debt obligations.
This is done by assigning risk points to a pre-set group of factors, termed financial risk
components. The minimum number of points that can be assigned to each component is zero,
while the maximum number of points depends on the fixed weight that component is given in the
overall financial risk assessment. In every case the lower the risk point total, the higher the risk,
and the higher the risk point total the lower the risk.
To ensure comparability between countries the components are based on accepted ratios between
measured data within the national economic/financial structure. It is the ratios that are compared,
not the data themselves. The risk points assigned to each component (ratio) are taken from a
fixed scale.
ASSESSING FINANCIAL RISK
As noted above, points are awarded to each risk component on a scale from zero up to a pre-set
maximum. In general terms if the points awarded are less than 50% of the total, that component
can be considered as very high risk. If the points are in the 50-60% range as high risk, in the
60%-70% range as moderate risk, in the 70-80% range as low risk and in the 80-100% range as
very low risk. However, this is only a general guideline as a better rating in other components
can compensate for a poor risk rating in one component.
Overall, a financial risk rating of 0.0% to 24.5% indicated a Very High Risk; 25.0% to 29.9%
High Risk; 30.0% to 34.9% Moderate Risk; 35.0% to 39.9% Low Risk; and 40.0% or more Very
Low Risk. Once again, however, a poor financial risk rating can be compensated for by a better
political and/or economic risk rating.
THE FINANCIAL RISK COMPONENTS – TABLE 4B
Foreign Debt as a Percentage of GDP – Table 12
The estimated gross foreign debt in a given year, converted into US dollars at the average
exchange rate for that year, is expressed as a percentage of the gross domestic product converted
into US dollars at the average exchange rate for that year. The risk points are then assigned
according to the following scale:
Foreign Debt % GDP
Ratio (%)
Points
0.0 to 4.9
10.0
5.0 to 9.9
9.5
10.0 to 14.9
9.0
15.0 to 19.9
8.5
20 to 24.9
8.0
25.0 to 29.9
7.5
30.0 to 34.9
7.0
35.0 to 39.9
6.5
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International Country Risk Guide
September 2003
Foreign Debt % GDP
Ratio (%)
Points
40.0 to 44.9
6.0
45.0 to 49.9
5.5
50.0 – 59.9
5.0
60.0 to 69.9
4.5
70.0 to 79.9
4.0
80.0 to 89.9
3.5
90.0 to 99.9
3.0
100.0 to 109.9
2.5
110.0 to 119.9
2.0
120.0 to 129.9
1.5
130.0 to 149.9
1.0
150.0 to 199.9
0.5
200.0 plus
0.0
Foreign Debt Service as a Percentage of Exports of Goods and Services – Table 13
The estimated foreign debt service, for a given year, converted into US dollars at the average
exchange rate for that year, is expressed as a percentage of the sum of the estimated total exports
of goods and services for that year, converted into US dollars at the average exchange rate for that
year.
The risk points are then assigned according to the following scale:
Debt Service % XGS
Ratio (%)
Points
0.0 to 4.9
10.0
5.0 to 8.9
9.5
9.0 to 12.9
9.0
13.0 to 16.9
8.5
17.0 to 20.9
8.0
21.0 to 24.9
7.5
25.0 to 28.9
7.0
29.0 to 32.9
6.5
33.0 to 36.9
6.0
37.0 to 40.9
5.5
41.0 to 44.9
5.0
45.0 to 48.9
4.5
49.0 to 52.9
4.0
53.0 to 56.9
3.5
57.0 to 60.9
3.0
61.0 to 65.9
2.5
66.0 to 70.9
2.0
71.0 to 75.9
1.5
76.0 to 79.9
1.0
80.0 to 84.9
0.5
85.0 plus
0.0
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International Country Risk Guide
September 2003
Current Account as a Percentage of Exports of Goods and Services – Table 14
The balance of the current account of the balance of payments for a given year, converted into US
dollars at the average exchange rate for that year, is expressed as a percentage of the sum of the
estimated total exports of goods and services for that year, converted into US dollars at the
average exchange rate for that year.
The risk points are then assigned according to the following scale:
Current Account as % XGS
Ratio (%)
Points
25.0 plus
15.0
20.0 to 24.9
14.5
15.0 to 19.9
14.0
10.0 to 14.9
13.5
5.0 to 9.9
13.0
0.0 to 4.9
12.5
-0.1 to –4.9
12.0
-5.0 to –9.9
11.5
-10.0 to -14.9
11.0
-15.0 to –19.9
10.5
-20.0 to –24.9
10.0
-25.0 to –29.9
9.5
-30.0 to –34.9
9.0
-35.0 to –39.9
8.5
-40.0 to –44.9
8.0
-45.0 - to –49.9
7.5
-50.0 to –54.9
7.0
-55.0 to –59.9
6.5
-60.0 to –64.9
6.0
-65.0 to –69.9
5.5
-70.0 to –74.9
5.0
-75.0 to –79.9
4.5
-80.0 to –84.9
4.0
-85.0 to –89.9
3.5
-90.0 to –94.9
3.0
-95.0 to –99.9
2.5
-100.0 to –104.9
2.0
-105.0 to –109.9
1.5
-110.0 to –114.9
1.0
-115.0 to –119.9
0.5
Below –120.0
0.0
Net International Liquidity as Months of Import Cover – Table 15
The total estimated official reserves for a given year, converted into US dollars at the average
exchange rate for that year, including official holdings of gold, converted into US dollars at the
free market price for the period, but excluding the use of IMF credits and the foreign liabilities of
the monetary authorities, is divided by the average monthly merchandise import cost, converted
into US dollars at the average exchange rate for the period.
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International Country Risk Guide
September 2003
This provides a comparative liquidity risk ratio that indicates how many months of imports can be
financed with reserves. The risk points are then assigned according to the following scale:
Net Liquidity in Months
Months
Points
15 plus
5.0
12.0 to 4.9
4.5
9.0 to 11.9
4.0
6.0 to 8.9
3.5
5.0 to 5.9
3.0
4.0 to 4.9
2.5
3.0 to 3.9
2.0
2.0 to 2.9
1.5
1.0 to 1.9
1.0
0.6 to 0.9
0.5
0.0 to 0.5.9
0.0
Exchange Rate Stability – Table 16
The appreciation or depreciation of a currency against the US dollar (against the German mark in
the case of the USA) over a calendar year or the most recent 12-month period is calculated as a
percentage change.
The risk points are then assigned according to the following scale:
Exchange Rate Stability
Appreciation
Depreciation
Change, plus
Change, minus
0.0 to 9.9
-0.1 to –4.9
10.0 to 14.9
-5.0 to -7.4
14.5 to 19.9
-7.5 to -9.9
20.0 to 22.4
-10.0 to -12.4
22.5 to 24.9
-12.5 to -14.9
24.9 to 27.4
-15.0 to -17.4
27.5 to 29.9
-17.5 to -19.9
30.0 to 34.9
-20.0 to -22.4
35.0 to 39.9
-22.5 to -24.9
40.0 to 49.9
-25.0 to -29.9
50 plus
-30.0 to -34.9
-35.0 to -39.9
-40.0 to -44.9
-45.0 to -49.9
-50.0 to -54.9
-55.0 to -59.9
-60.0 to -69.9
-70.0 to -79.9
-80.0 to -89.9
-90.0 to -99.9
-100 plus
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Points
10.0
9.5
9.0
8.5
8.0
7.5
7.0
6.5
6.0
5.5
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
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International Country Risk Guide
September 2003
THE COMPOSITE RISK RATING – TABLE 2B
The method of calculating the Composite Political, Financial, and Economic Risk Rating
remains unchanged. The political risk rating contributes 50% of the composite rating, while the
financial and economic risk ratings each contribute 25%.
The following formula is used to calculate the aggregate political, financial and economic risk:
CPFER (country X) = 0.5 (PR + FR + ER)
where
CPFER = Composite political, financial and economic risk ratings
PR = Total political risk indicators
FR = Total financial risk indicators
ER = Total economic risk indicators
The highest overall rating (theoretically 100) indicates the lowest risk, and the lowest rating
(theoretically zero) indicates the highest risk.
As a general guide to grouping countries on the basis of comparable risk, the individual risk of
individual countries can be estimated using the following fairly broad categories of Composite
Risk.
Very High Risk
High Risk
Moderate Risk
Low risk
Very Low Risk
00.0 to 49.5 points
50.0 to 59.5 points
60.0 to 69.5 points
70.0 to 79.5 points
80.0 to 100 points
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International Country Risk Guide
September 2003
RISK FORECASTS
In addition to the current forecasts of Political, Financial, Economic, and Composite Risk, the
ICRG team also produces one- and five-year forecasts for each of the risk categories, produced
using the same methodology that is used for the current risk forecasts.
Two forecasts are produced for each time period – a Worst Case Forecast (WCF) and a Best Case
Forecast (BCF).
The WCF is produced by extrapolating the worst-case trend for each risk component in each risk
category to produce a WCF for Political, Economic, and Financial Risk.
The BCF is produced by extrapolating the best-case trend for each risk component in each risk
category to produce a BCF for Political, Economic, and Financial Risk.
The WCF and BCF do not represent the possible extremes of risk, but a “reasonably possible”
outcome.
However, negative and positive trends can be identified and a reasonable supposition made as to
their outcome, presuming action is not taken to avert such an outcome. Such trends could be an
accelerating build-up of debt, political fragmentation, worsening ethnic or religious tensions, in
adequate arrangements for government takeover in the case of the death or assassination of a
leader, and so on. In approaching the forecasting exercise we make a judgment as to the
“reasonableness” of the trend or event identified and the ability of the government to counteract
such trends. This is the basis on which the WC and BC forecasts are determined.
Thus, it is possible for a country to produce a worse performance than our WC forecast or a better
performance than our BC forecast, but we do not see such an outcome as likely.
Analyzing the Forecasts
The forecasts lend themselves to a variety of analyses. We think the following are probably the
most useful – Risk Stability, Downside Risk, and Upside Risk.
Risk Stability
A country can appear to present a solid basis for investment on the basis of an acceptable level of
risk in terms of its current CRR and its forecast MP Forecast CRR. However, these numbers give
no indication of how stable that assessed situation is – i.e. to what degree that risk assessment
might vary.
We have made an attempt to measure this stability or instability by introducing the concept of
Risk Stability.
In our forecasting system the Risk Stability of an individual country is the difference between the
WCF and the BCF and represents the volatility or stability of risk for that country. The greater
the difference, the greater the volatility or the less the stability.
Downside Risk
This is a measure of the degree to which a Risk Category could reasonably be expected to
deteriorate if the negative trends noted in the risk components are not compensated for, and is
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International Country Risk Guide
September 2003
expressed as the difference between the MP forecast and the WC Forecast. The greater the
difference, the greater the downside risk.
Upside Risk
This is a measure of the positive potential of the country that could be realized if the positive
trends identified in the risk components are fully exploited in conjunction with a generally
favorable environment. It is expressed as the difference between the MP Forecast and the BC
Forecast. The greater the difference, the greater the downside risk.
Presentation
The risk forecasts are presented in the following tables.
•
•
•
•
Table 2C: One- and Five-year forecast of the Composite Risk (WCF and BCF) and their
Risk Stability.
Table 3C: One- and Five-year forecasts of Political Risk (WCF and BCF) and their Risk
Stability.
Table 4C: One- and five-year forecasts of Financial Risk (WCF and BCF) and their Risk
Stability.
Table 5C: One- and five-year forecasts of Economic Risk (WCF and BCF) and their Risk
Stability.
In addition, the one- and five-year WCF and BCF for the Composite Risk are presented in Table
2B, along with the current CRR.
*
*
*
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September 2003

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