Supply chains in Asia face natural disaster riskA recent report by global risk firm Maplecroft revealed that several of Asia's growing economies risk being hampered by unexpected natural disasters, such as floods, droughts, earthquakes and hurricanes.

The study investigated the risk of natural hazards in 197 countries and their governments' ability to respond effectively to a crisis to assess the risk to corporations that rely global supply chains to conduct business.

Helen Hodge, head of Maplecroft's maps and indices, mentioned that as these emerging economies develop globally, a natural disaster will have wider effects felt across the world. When global companies choose to do business in a developing country to lower their manufacturing costs, natural disasters may be harder to recover from. The effects of a disaster will not only be felt in the country that experiences the event, but also those with facilities there.

"High exposure to natural hazards in these countries is compounded by a lack of resilience to combat the effects of a disaster should one emerge," Hodge said. "Given the exposure of key financial and manufacturing centers, the occurrence of a major event would be very likely to have significant implications on the total economic output of these countries, as well as foreign business with interests there."

The countries most at risk to suffer economically from a natural disaster were located primarily in Asia. Bangladesh, the Philippines, Myanmar, India, Vietnam and Laos represent the countries with the highest risk, while Honduras, Haiti and the Dominican Republic also ranked poorly.

Two of these countries have recently experienced serious disasters, and are struggling to repair damage which has the potential to leave a lasting impact on their economies. The Philippines have dealt with storms and severe flooding, while India is undergoing a serious drought.

The study found that Japan, China, Taiwan, the U.S. and Mexico have the highest economic risk due to prevalent natural hazards, but their strong economies, stable governments and infrastructure help them recover from disasters quickly. Just one year after a devastating earthquake that caused a nuclear crisis, Japan's economy has returned to levels seen prior to the disaster.

The study found that although some large countries can recover in a timely fashion, a lack of preparedness and infrastructure could result in years of economic setbacks for many of the Asian countries on the list. When a disaster strikes one of these areas, it could easily disrupt supply chains worldwide.
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  1. I am agreed on it that we can not avoid natural disasters but we can identified the less effected areas in a country like India.

    It can happen anywhere.I suggest to have a positive approach and move ahead.

    Do not underestimate Indian Economy we have enough gold in our homes which can help us to recover the loses if any.Turn the History and u come to know that invadors and others trying to loot and soil us since centuries but India is still golden bird.

    We are ot afraid and ready to handle any situation.


    Vinod Singh
    Retaurant consultant