2020

Countries’ Risk
Classification
2020Risk

Countries’ Risk Classification

amfori BSCI

The risk classification of countries relies on the Worldwide Governance

The risk classification of countries relies on the Worldwide Governance

Indicators, being aggregate indicators of governance 1996-2018. These
determine the level of risks related to governance in sourcing countries.

Governance Indicators
There are 6 dimensions of governance identified by the World Bank:

1. Voice and Accountability (VA) – capturing perceptions of the extent to which a country's citizens are able to participate in
selecting their government, as well as freedom of expression, freedom of association and a free media.

2. Political Stability and Absence of Violence/Terrorism (PV) – capturing perceptions of the likelihood that the government will
be destabilized or overthrown by unconstitutional or violent means, including politically‐motivated violence and terrorism.

3. Government Effectiveness (GE) – capturing perceptions of the quality of public services, the quality of the civil service and
the degree of its independence from political pressures, the quality of policy formulation and implementation, and the
credibility of the government's commitment to such policies.

4. Regulatory Quality (RQ) – capturing perceptions of the ability of the government to formulate and implement sound policies
and regulations that permit and promote private sector development.

5. Rule of Law (RL) – capturing perceptions of the extent to which agents have confidence in and abide by the rules of society
and in particular the quality of contract enforcement, property rights, the police, the courts, as well as the likelihood of crime
and violence.

6. Control of Corruption (CC) – capturing perceptions of the extent to which public power is exercised for private gain,
including both petty and grand forms of corruption, as well as ‘capture’ of the state by elites and private interests.

Full interactive access to the aggregate indicators and the underlying source data, is available at www.govindicators.org

Worldwide Governance Indicators update incorporates revisions to data for previous years, and so this data release
supersedes data from all previous releases.

The 2018 Worldwide Governance Indicators were published by the Worldbank on the 21st September 2019 and extracted
on the 23rd September 2019 for use in this Countries’ Risk Classification.

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Application

For the purpose of amfori BSCI, countries are classified in two different categories:

Risk countries: Countries with WGI average rating between 0-60 or three or more individual dimensions rated below 60.

Low-risk countries: Countries with WGI average rating higher than 60 and no more than two individual dimensions rated below
60.

An additional call-out is made for Most Severe Risk countries: countries with WGI average rating below 3 or at least two
individual dimensions rated below 1.

This classification supports amfori BSCI participants in their human rights’ due diligence approach to define their priorities in
terms of monitoring, capacity building and stakeholder engagement. An additional tool, the Country Due Diligence tool, is
available to provide more specific information on sustainability issues, which are not reflected in the classification below.

It is up to each amfori BSCI participant to define its own due diligence approach. amfori shall not be held responsible for any
action or omission deriving from the way amfori BSCI participants decide to use this classification.

Validity
This countries’ risk classification version 2020 enters into force on 1 January 2020. It overrules amfori BSCI list of Risk countries
version 2019 and will remain valid until the next version.

Further Explanation

amfori has provided further guidance for countries that have changed their classification (risk to high risk, or vice-versa). We
have also prepared information on countries that have seen a significant change in rating but stayed within the same
classification since the 2019 edition. Further special notes are added for risk countries with an overall score of over 60.

This edition has explanations added for the following countries:

o Micronesia (Federal States of) o Tonga

o Palau o Venezuela
o Seychelles o Jamaica
o Tuvalu o Kiribati
o Gambia o Malaysia
o Grenada o Puerto Rico
o Nicaragua

These countries are marked with an asterisk in the risk listing. This indicates that a further information is available on these
countries.

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Risk Countries

Political Stability
Overall Voice and & Absence of Government Regulatory Rule of Control of
risk Accountability Violence Effectiveness Quality Law Corruption
Country 2018 2018 2018 2018 2018 2018 2018
Afghanistan 8.0 20.7 0.5 7.7 10.6 4.3 4.3
Albania 51.2 53.2 58.6 57.7 63.5 39.4 35.1
Algeria 22.7 21.7 18.6 37.0 8.2 22.1 28.4
Angola 18.3 22.7 34.8 13.9 13.0 13.9 11.5
Argentina 51.8 67.0 46.7 54.8 42.3 45.7 54.3
Armenia 46.0 40.4 30.5 51.4 62.5 48.6 42.8
Azerbaijan 27.6 7.9 21.0 49.0 37.0 29.3 21.6
Bahrain 45.5 10.8 17.1 59.6 67.8 66.3 51.4
Bangladesh 21.2 27.6 13.8 21.6 19.2 28.4 16.8
Belarus 34.1 11.8 58.1 40.4 26.0 19.2 49.0
Belize 39.4 61.1 46.2 30.3 26.4 20.2 51.9
Benin 39.9 57.6 41.9 32.7 38.9 26.9 41.3
Bolivia 29.4 44.3 38.1 39.9 15.9 9.6 28.8
Bosnia and Herzegovina 36.7 37.4 31.0 28.4 45.2 46.6 31.7
Brazil 42.2 60.6 31.9 36.1 39.9 44.2 40.4
Bulgaria 59.9 59.1 60.5 63.0 72.6 53.4 51.0
Burkina Faso 35.4 43.8 13.3 31.3 36.1 34.6 53.4
Burundi 7.6 5.4 7.6 8.2 13.5 5.8 5.3
Cambodia 25.0 13.8 51.4 32.2 32.7 11.1 8.7
Cameroon 15.0 18.2 8.6 19.7 20.2 12.5 11.1
Central African Republic 6.9 14.8 2.9 2.9 6.7 3.8 10.6
Chad 8.1 8.4 8.1 6.7 11.5 7.2 6.7
China 42.8 8.9 36.7 69.7 48.1 48.1 45.7
Colombia 44.8 52.7 17.6 50.0 65.4 38.5 44.7
Comoros 20.3 33.0 39.0 3.8 11.1 12.0 22.6
Cuba 37.4 9.9 67.6 44.7 6.3 35.1 61.1
Djibouti 23.1 11.3 41.4 17.3 24.5 17.3 26.4
Dominican Republic 42.0 51.2 47.6 39.4 50.5 38.9 24.5
Democratic Republic of
5.1 7.4 4.8 5.8 5.8 2.9 3.8
the Congo
Ecuador 35.2 47.3 43.3 42.8 16.3 28.8 32.7
Egypt 23.7 13.3 11.9 30.8 17.8 37.5 30.8
El Salvador 36.9 48.3 33.3 36.5 53.8 19.7 29.8
Equatorial Guinea 11.6 2.5 43.8 9.6 4.8 6.7 2.4
Eritrea 7.3 0.5 24.8 2.4 1.9 5.3 9.1
Ethiopia 23.8 16.3 9.5 29.3 13.9 36.5 37.5
Eswatini 32.0 12.3 35.2 25.0 29.8 45.2 47.1
Fiji 58.4 54.7 71.0 62.5 44.7 50.0 67.3

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 Political Stability
Overall Voice and & Absence of Government Regulatory Rule of Control of
risk Accountability Violence Effectiveness Quality Law Corruption
Country 2018 2018 2018 2018 2018 2018 2018

Gabon 23.3 22.2 37.7 18.8 16.9 24.6 19.8

Gambia* 35.7 38.4 44.8 27.4 28.4 36.1 38.9
Ghana 53.5 68.0 47.1 46.2 50.0 56.7 52.9
Greece* 61.8 75.4 50 65.9 64.4 59.1 55.8
Guatemala 27.9 35.5 27.1 23.6 45.7 13.5 22.1
Guinea 17.3 26.1 16.7 16.3 21.6 9.1 13.9
Guinea Bissau 13.3 29.1 21.9 7.2 9.6 8.7 3.4
Guyana 43.4 56.7 41.0 41.8 32.2 41.8 46.6
Haiti 14.3 26.6 23.3 1.4 8.7 15.9 9.6
Honduras 27.7 31.5 26.7 27.9 34.6 16.3 29.3
India 48.4 60.1 14.8 63.9 46.6 55.3 49.5
Indonesia 46.5 52.2 27.6 59.1 51.0 42.8 46.2
Iran 18.3 12.8 11.0 37.5 7.7 25.0 15.9
Iraq 8.6 21.2 1.4 9.1 9.1 3.4 7.2
Ivory Coast 33.1 37.9 15.7 31.7 46.2 30.8 36.5
Jordan 49.4 28.1 31.4 57.2 58.7 60.6 60.6
Kazakhstan 41.3 15.8 45.7 54.3 60.1 35.6 36.1
Kenya 31.2 35.0 12.4 38.9 43.8 38.0 19.2
Kuwait 48.7 30.5 52.4 49.5 54.3 60.1 45.2
Kyrgyzstan 26.7 34.0 25.2 28.8 38.0 17.8 16.3
Kosovo 39.9 24.3 38.0 41.3 40.4 35.6 36.6
Lao People’s
24.0 4.4 60.0 24.5 20.7 18.8 15.4
Democratic Republic
Lebanon 23.2 32.0 7.1 26.0 38.5 23.6 12.0
Lesotho 39.3 50.7 38.6 18.3 33.2 41.3 53.8
Liberia 23.9 43.3 40.0 8.7 14.4 16.8 20.2
Madagascar 23.0 36.5 28.1 11.1 23.7 21.2 14.9
Malawi 31.5 42.4 34.3 22.1 25.5 39.9 25
Maldives 33.1 30.0 50.5 35.1 33.7 31.7 17.3
Mali 22.8 36.9 5.2 15.4 30.8 21.6 26.9
Marshall Islands 48.2 87.7 77.6 6.3 10.1 52.9 54.8
Mauritania 23.1 24.1 22.4 22.6 19.7 26.4 23.1
Mexico 37.6 45.8 25.7 47.6 60.6 27.4 18.8
Micronesia (Federal
62.5 87.7 94.8 48.1 14.9 53.8 75.5
States of)*
Moldova 37.4 40.9 32.9 35.6 51.9 37.0 26.0
Mongolia 52.8 57.1 74.3 45.7 54.8 44.7 39.9
Montenegro 56.9 50.2 51.0 58.2 65.9 57.7 58.2
Morocco 41.7 29.6 33.8 46.6 42.8 49.5 47.6
Mozambique 22.0 32.5 19.0 17.8 24.0 14.4 24.0
Myanmar 19.1 23.6 10.5 12.5 22.6 15.4 30.3
Nauru 49.5 71.4 63.3 50.5 52.9 25.5 33.7
Nepal 27.4 39.4 23.8 16.8 23.1 33.7 27.4
Nicaragua* 18.2 18.7 18.1 19.2 25.0 14.9 13.0
Niger 25.3 31.0 11.4 20.2 27.9 30.3 31.3

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 Political Stability
Overall Voice and & Absence of Government Regulatory Rule of Control of
risk Accountability Violence Effectiveness Quality Law Corruption
Country 2018 2018 2018 2018 2018 2018 2018

Nigeria 17.0 33.5 4.3 14.9 17.3 18.3 13.5

North Macedonia 49.7 45.3 39.5 55.8 71.6 43.8 42.3
Oman 57.3 19.7 68.6 60.1 64.9 68.3 62.5
Palau* 61.5 87.7 77.6 52.4 55.8 62.0 33.7
Pakistan 22.5 25.6 3.3 26.9 27.4 27.9 23.6
Panama 54.6 68.5 56.2 51.9 66.3 52.4 32.2
Papua New Guinea 28.0 48.8 22.9 24.0 31.3 23.1 17.8
Paraguay 37.9 49.3 42.4 34.1 48.6 32.2 20.7
Peru 45.8 55.2 37.1 44.2 71.2 32.7 34.6
Philippines 40.2 47.8 12.9 55.3 56.7 34.1 34.1
Puerto Rico* 63.6 64.0 59.0 47.1 79.3 73.1 59.1
Republic of the Congo 13.6 15.3 29.5 10.1 7.2 11.5 7.7
Romania 56.1 61.6 48.6 43.3 67.3 63.5 52.4
Russia 28.8 19.2 29.0 51.0 31.7 20.7 21.2
Rwanda 53.4 17.2 52.9 62.0 59.1 58.2 71.2
São Tomé and Principe 41.4 51.7 64.3 26.4 18.3 26.0 61.5
Saudi Arabia 46.2 5.9 28.6 64.9 53.4 58.7 65.9
Serbia 50.0 46.3 49.5 56.7 56.2 49.0 41.8
Senegal 49.1 55.7 42.9 42.3 49.5 47.6 56.7
Seychelles 63.0 54.2 69.5 71.2 47.6 59.6 76.0
Sierra Leone 28.3 38.9 44.3 11.5 15.4 22.6 37.0
Solomon Islands 43.2 65.0 57.1 13.5 18.8 47.1 57.7
South Africa 57.1 70.4 36.2 66.3 61.5 51.0 57.2
State of Palestine 31.6 23.2 6.7 20.7 57.2 33.2 48.6
Sri Lanka 46.4 46.8 40.5 45.2 47.1 55.8 43.3
Sudan 5.5 3.0 5.7 4.3 3.8 10.6 5.8
Suriname 43.6 58.1 49.0 25.5 28.8 51.9 48.1
Tajikistan 10.6 4.9 20.0 12.0 12.5 7.7 6.3
Tanzania 30.3 34.5 26.2 21.2 29.3 31.3 39.4
Thailand 43.6 20.2 19.5 66.8 59.6 54.8 40.9
East Timor 33.6 59.6 56.7 15.9 21.2 10.1 38.5
Togo 22.8 27.1 14.3 13.0 26.9 29.8 25.5
Tonga* 60.4 66.5 79.5 58.7 37.5 64.9 55.3
Trinidad and Tobago 55.5 67.5 54.8 60.6 55.3 50.5 44.2
Tunisia 44.4 53.7 16.2 48.6 35.6 56.3 56.3
Turkey 37.9 25.1 10.0 53.8 52.4 42.3 43.8
Turkmenistan 13.0 1.0 45.2 14.4 2.9 6.3 8.2
Tuvalu* 61.3 87.7 97.6 23.1 30.3 70.7 58.7
Uganda 29.9 28.6 21.4 29.8 41.8 43.3 14.4
Ukraine 29.3 44.8 6.2 38.5 44.2 24.0 18.3
Uzbekistan 18.9 6.4 35.7 33.7 12.0 13.0 12.5
Vanuatu 54.2 66.0 75.2 34.6 34.1 64.4 50.5
Vietnam 40.9 9.4 53.8 53.4 36.5 54.3 38.0
Zambia 37.7 36.0 53.3 33.2 35.1 40.9 27.9
Zimbabwe 11.7 16.7 20.5 10.6 4.3 8.2 10.1

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Low Risk Countries

Political Stability
Overall Voice and & Absence of Government Regulatory Rule of Control of
risk Accountability Violence Effectiveness Quality Law Corruption
Country 2018 2018 2018 2018 2018 2018 2018

Andorra 90.3 83.3 97.6 98.6 85.1 90.9 86.5

Antigua and Barbuda 64.7 69.5 70.5 52.9 66.8 65.4 63.5
Aruba 86.6 91.6 95.7 80.3 77.9 87.0 87.0
Australia 92.5 95.6 82.9 92.8 98.1 92.8 92.8
Austria 90.9 93.1 81.0 90.9 91.3 97.6 91.3
The Bahamas 70.8 73.4 78.6 71.6 61.1 57.2 83.2
Barbados 76.9 84.2 81.4 68.8 72.1 65.9 88.9
Belgium 83.7 94.1 59.5 83.7 86.1 88.5 90.4
Bhutan 68.1 49.8 88.6 67.3 39.4 71.6 91.8
Botswana 71.1 62.6 83.3 65.4 68.8 68.8 77.9
Brunei 72.1 24.6 91.9 87.0 74.5 75.0 79.8
Canada 93.1 96.1 84.8 94.7 93.8 94.7 94.7
Cape Verde 67.6 79.8 71.9 64.4 43.3 67.8 78.4
Cayman Islands 77.5 64.0 90.0 85.6 80.8 76.4 68.3
Chile 80.0 82.3 61.4 81.7 88.9 83.7 81.7
Costa Rica 70.7 84.7 62.4 67.8 69.2 69.2 70.7
Croatia 66.5 64.5 73.8 69.2 68.3 63.0 60.1
Cyprus 75.8 80.8 64.8 77.9 81.3 76.0 74.0
Czech Republic 80.3 78.3 87.1 78.4 87.0 81.7 69.2
Denmark 94.5 98.0 82.4 97.1 94.2 96.6 98.6
Dominica 67.7 74.4 89.0 40.9 57.7 74.0 70.2
Estonia 84.8 89.7 66.2 84.6 91.8 86.5 89.9
Finland 96.1 98.5 81.9 99.0 97.1 100.0 100.0
France 82.1 88.2 51.9 91.8 83.7 88.9 88.0
French Guiana 83.2 91.6 63.8 89.4 87.5 85.6 81.3
Georgia 64.0 56.2 30.0 74.0 83.2 63.9 76.4
Germany 89.4 95.1 66.7 93.3 94.7 91.3 95.2
Greenland 89.5 91.6 100.0 76.9 89.9 94.2 84.1
Grenada 60.7 65.5 85.2 43.8 40.4 62.5 66.8
Hong Kong 87.1 62.1 74.8 98.1 100.0 95.2 92.3
Hungary 67.8 58.6 73.3 70.2 73.1 72.1 59.6
Iceland 93.3 94.6 96.7 91.3 90.4 93.3 93.8
Ireland 90.3 92.1 86.2 89.9 92.8 89.9 90.9
Italy 67.5 81.8 57.6 68.3 73.6 61.5 62.0
Israel 69.6 70.0 15.2 86.1 86.5 80.8 79.3
Jamaica* 60.3 69.0 62.9 70.8 63.0 46.2 50.0
Japan 88.4 80.3 88.1 94.3 88.0 90.4 89.4
Jersey, Channel Islands 87.5 91.6 93.3 87.5 75.5 94.2 82.7

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 Political Stability
Overall Voice and & Absence of Government Regulatory Rule of Control of
risk Accountability Violence Effectiveness Quality Law Corruption
Country 2018 2018 2018 2018 2018 2018 2018

Kiribati* 62.1 87.7 86.7 41.3 22.1 69.7 64.9

South Korea 77.3 73.9 65.2 84.1 82.2 86.1 72.1
Latvia 74.2 74.9 61.0 79.8 85.6 79.3 64.4
Liechtenstein 94.1 92.6 98.1 95.2 90.9 92.3 95.7
Lithuania 77.1 77.8 72.9 80.8 82.7 79.8 68.8
Luxembourg 96.1 96.6 96.2 95.7 95.2 95.7 97.1
Macao 78.8 42.9 92.9 85.6 93.3 81.3 76.9
Malaysia* 64.9 41.4 54.3 81.3 74.0 74.5 63.9
Malta 83.1 83.7 93.8 78.8 88.5 82.2 71.6
Mauritius 75.1 72.4 79.0 77.4 81.7 76.9 63.0
Namibia 60.9 63.1 68.1 56.3 51.4 61.1 65.4
Netherlands 93.9 97.0 78.1 96.6 99.0 96.2 96.2
New Zealand 98.1 99.5 99.0 93.8 98.6 98.1 99.5
Norway 96.8 100.0 90.5 97.6 95.7 99.5 97.6
Poland 72.1 71.9 65.7 75.0 78.4 66.8 74.5
Portugal 84.8 88.7 89.5 86.5 78.8 85.1 80.3
Qatar 63.6 14.3 69.0 74.5 70.7 75.5 77.4
Samoa 73.3 72.9 91.4 73.6 49.0 77.9 75.0
Singapore 89.4 41.9 98.6 100.0 99.5 97.1 99.0
Slovakia 72.9 76.8 72.4 75.5 76.0 70.2 66.3
Slovenia 80.2 79.3 80.0 83.2 75.0 82.7 80.8
Spain 75.1 82.8 55.2 79.3 80.3 80.3 72.6
St. Kitts and Nevis 71.5 77.3 70.0 72.6 70.2 71.2 67.8
St. Lucia 71.6 75.9 85.7 61.5 63.9 72.6 69.7
St. Vincent and the
70.4 76.4 76.2 61.5 62.0 67.3 78.8
Grenadines
Sweden 94.7 97.5 80.5 96.2 97.6 98.6 98.1
Switzerland 97.7 99.0 95.2 99.5 96.6 99.0 96.6
Taiwan 83.0 78.8 75.7 88.5 89.4 83.2 82.2
United Arab Emirates 70.1 17.7 71.4 90.4 79.8 77.4 83.7
United Kingdom 85.2 93.6 48.1 88.0 96.2 91.8 93.3
United States 84.3 81.3 61.9 92.3 92.3 89.4 88.5
Uruguay 80.1 89.2 87.6 73.1 69.7 73.6 87.5

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Incomplete Risk Classification Ratings

A total of eight (8) countries could not be assigned with an updated Risk Classification Rating, as no data is available for one or
more dimensions.

Political Stability
Overall Voice and & Absence of Government Regulatory Rule of Control of
risk Accountability Violence Effectiveness Quality Law Corruption
Country 2018 2018 2018 2018 2018 2018 2018

Anguilla no data no data 94.3 76.4 77.4 51.4 86.5

Bermuda no data no data 91.0 88.9 77.4 78.8 86.5
Guam no data no data 67.1 63.5 58.2 88.0 86.5
Martinique no data no data 84.3 82.7 85.1 78.8 86.5
Monaco no data 71.4 99.5 no data no data no data no data
Réunion no data no data 55.7 82.7 85.1 84.6 73.6
San Marino no data 87.7 77.6 no data no data no data no data
Virgin Islands (U.S.) no data no data 84.3 76.4 77.4 84.6 73.6

Country Name Change

Macedonia has officially changed its name to North Macedonia in 2019, which is also reflected in the United Nations Member
States list.

Most Severe Risk Countries

The most severe Risk Countries are countries with a WGI average rating below 3 or at least two individual dimensions rated
below 1.

Political Stability
Overall Voice and & Absence of Government Regulatory Rule of Control of
risk Accountability Violence Effectiveness Quality Law Corruption
Country 2018 2018 2018 2018 2018 2018 2018

North Korea 7.4 0.0 32.4 5.3 0.0 4.8 1.9

Somalia 1.6 3.4 3.8 1.0 1.0 0.5 0.0
Libya 2.9 6.9 1.9 1.9 1.4 2.4 2.9
South Sudan 1.4 1.5 2.4 0.0 2.4 1.4 0.5
Syria 2.0 2.0 1.0 3.4 3.4 1.0 1.4
Venezuela* 4.9 10.3 9.0 4.8 0.5 0.0 4.8
Yemen 2.1 3.9 0.0 0.5 5.3 1.9 1.0

Most Severe Risk Countries present a higher risk of human right violations perpetrated against workers. At the same time,
extremely poor governance and political instability may hinder amfori members from pursuing reasonable due diligence in their
supply chains in those countries: monitoring and capacity building activities might not be possible.

amfori members should aim to:

▪ Assess if they have direct or indirect business linkages with Most Severe Risk Countries (e.g. for specific components or
commodities);
▪ Consult the Country Due Diligence Tool and identify critical risks on social, environmental and trade issues

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▪ Alert sourcing department and / or suppliers on the critical risks and collect information on any risk prevention practices in
place
▪ If need arises, contact the amfori Secretariat for support on policy advocacy and stakeholder engagement.

Risk Classification Changes

Four (4) countries have seen a change in its classification while five (5) countries have seen significant change in either their
overall rating or in individual dimensions without a change in classification. Six (6) countries are high risk country even though
their overall score is higher than 60, because three (3) or more of their indicators have a score lower than 60.

Please find more details below per country and some explanation as to what could have influenced this change.

Countries that went from Risk to Low Risk

o Jamaica
o Kiribati
o Malaysia

Jamaica

Jamaica’s overall score has been increasing over the years and is for the first time no longer considered as a Risk Country. The
improvement of the indicator Political Stability and Absence of Violence & Terrorism have had the largest impact on Jamaica’s
total rating

 The bipartisan parliamentary democracy is stable but participation in elections has declined over recent decades,
translating a lack of trust in the Jamaican institutions.
 High unemployment rate is one of the most important issues in Jamaica. Employment policies are dependant of economic
growth, which has been very low in the last decade.
 Jamaica’s high crime rate and violent crimes are another important issue, which is exacerbated by the ties between
elected representatives and organised criminals. A state emergency was declared in 2018 to tackle violence, since then
murder rate has dropped by 21%.

Kiribati

Kiribati is for the first time not considered as a risk country after the improvement of the score of all indicators. There are still
large risks identified in the indicators: Government Effectiveness and Regulatory Quality.

 Kiribati is a combination of 32 atolls, and reef islands, and one coral island. The main issues the country faces are a
shortage of skilled workers, weak infrastructure and remoteness from international markets
 Most of the economy is dominated by the public sector, through ongoing infrastructure projects. Foreign aid contributes to
one third of the government’s finances.

Malaysia

Malaysia’s overall score has increased by 4.8 points since last year, moving away from the 60 points, limit to become a Risk
Country. Voice & Accountability and Political stability & absence of violence are two indicators still considered as a risk, but
Control of Corruption is no longer scored below 60 so Malaysia becomes a Low Risk country.

 Malaysian’s democracy is authoritarian, limiting political competition by restricting the freedom of speech and the right of
assembly. Nevertheless, the opposition is present in the federal parliament and at state level and even won the last
elections in 2018, for the first time.

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 Freedom of expression is constitutionally guaranteed but restricted in practice. NGOs must be approved and registered by
the government, which has in the past refused or revoked registrations for political reasons.
 Judicial independence is compromised by an extensive executive influence. Arbitrary or politically motivated verdicts are
common.
 Allegations of torture and abuse in prison custody, including deaths, continue. Prisons are overcrowded and dangerous.
 The Malaysian constitution defines the state as secular, but Islam has considerable influence on the Malaysian legal
system and the country’s political institutions. Non-Muslims are not able to build houses or worship as easily a Muslims.
 Malaysia does not take part to the 1951 Refugee Convention, although the new government has committed to ratify the
convention. Over 170 000 refugees and asylum seekers are living in the country.
 In 2018, allegations of systematic violations of workers’ human rights, particularly against migrant workers, were detected
in the rubber gloves manufacturing sector.

Countries that went from Low Risk to Risk

Puerto Rico

Puerto Rico’s overall result continues to lower now reaching 63.62. The indicators Political Stability & Absence of Violence,
Government Effectiveness and Control of Corruption are considered as a risk.

 Protests erupted in July 2019 leading to the resignation of Governor Rosselló and other government officials. The protests
were exacerbated by corruption charges against members of the administration
 Puerto Rico declared bankruptcy in 2015 and efforts to restructure the economy are ongoing but the U.S. territory still
faces fiscal challenges and a lack of economic competitiveness.
 After the hurricane Maria causing the death of nearly 3000 people and $94 billion of damages two years ago, the
reconstruction was slow and tourism is still weak, making the economy recovery slower.

Countries which have seen a significant change in rating, but have not changed
classification
o Gambia
o Grenada
o Nicaragua
o Tonga
o Venezuela

Gambia

Although the Gambia remains a risk country, its overall score has increased by 12 points in the last 3 years, making one of the
biggest changes of this year’s Country Risk Classification. The overall result is 35.66, similar to the overall risk 5 years ago.

 The 2016 presidential election resulted in the surprise victory of candidate Adama Barrow, after over 20 years of ruling by
President Jammeh. A transparent and peaceful parliamentary election followed in 2017.
 Since the elections fundamental rights such as the right of assembly, association, speech have improved, exiled journalists
and human rights defenders returned, and political prisoners were released.
 Regulatory reforms have lowered the corporate taxes and eased access to land to rebuild investors’ confidence. More
generally the economy is benefiting from the democratisation, through agriculture, trade and tourism.
 Rule of law remains weak, undermined by weak protection of propriety rights and corruption remains a critical problem. A
high unemployment rate remains, and growing debt is crippling the growth of the economy.
 Although Gambia along with South Africa and Burundi decided to withdraw from the International Criminal Court in 2016,
the new president has requested to re-join the Court.

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Grenada

Grenada is a Low Risk country, but the overall score has been going down in the last couple of years and is now at 0.7 points
from becoming a Risk country. Government Effectiveness and Regulatory Quality are the two indicators with the lowest scores.

 Grenada is a parliamentary democracy, with fair and impartial elections, but an unbalanced size of constituencies has
resulted in unequal voting power among citizens.
 All propositions to reform the Constitution in 2016 were rejected in a referendum with a very low turnout. After the elections
in 2018, the lack of opposition in the House of Representatives created concerns and three former ministers were
appointed to Senate.
 Corruption remains a prominent issue in Grenada, despite safeguards enshrined in the Prevention of Corruption Act (2007)
and the Integrity in Public Life Act (2007). More anti-corruption rules were proposed in the Constitutional reform in 2016 but
were all rejected.
 The Constitution protects the right of worker to form and join unions and to strike. ‘Essential workers’ may strike too, but
this right is limited by compulsory arbitration to resolve disputes. The definition of essential workers is more extensive than
the list of services considered as essential by the International Labour Organisation (ILO).
 The Constitution prohibits gender discrimination but in practice discrimination remains common, so does violence against
women and children. LGBT people face significant societal discrimination. An amendment to the Constitution to protect the
equal treatment of people in Grenada was rejected in the 2016 referendum.

Nicaragua

Nicaragua’s overall risk score has been going down for years, but suddenly lost 10 points this year. All indicators are very low.

 President Ortega was elected in 2006 and was re-elected for a third time in 2016, in an election that is considered by
international observers as unfair and not free. Ortega circumvented a constitutional prohibition on re-election. His party
secured the majority in Congress in 2016, enabling institutional reforms reinforcing the control of Ortega government over
the political and economic system.
 The Electoral Council has barred political parties and removed opposition.
 In 2018 a nationwide anti-government protest movement was violently opposed by national police and armed pro-
government groups resulting in 300 dead, over 2000 injured and hundreds of arrests.
 Inequalities were deepened by breaches of economic, social and cultural rights resulting in protests against austerity
measures.
 Violence and insecurity make Nicaragua the country with of the highest murder rates in the world.

Tonga

All the indicators’ scores are improving but Tonga remains a Risk Country because of Government Effectiveness, Regulatory
Quality and Control of Corruption.

 Tonga is a constitutional monarchy with a prime minister backed by mostly elected parliament since 2010. However, the
king retains important powers including the authority to veto legislation, dissolve the parliament and appoint judicial
officials.
 The constitution protects equality before the law. However, women face discrimination, in laws governing land and
inheritance.
 Politicians often sue media, exposing them to the risk of heavy fines. In these conditions, journalists say they are forced to
censor themselves due to the threat of bankruptcy.
 Public sector dominates the market which slows economic dynamism.
 The judicial system is inefficient and lacks transparency.
 Tonga was hit by Cyclone Gita in 2018, the worst storm to hit Tonga in 60 years.

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Venezuela

With an overall score of 4.91, Venezuela is a Most Severe Risk country. The score has gone down by 40% in the last 3 years
and almost none of the indicators score over 10.

 President Maduro, Chavez’s successor, established a repressive autocratic dictatorship in 2017 and institutions collapsed
for not being able to function under the new regime. The presidential election was profoundly flawed, with the ban of
opposition candidates and voter intimidation.
 The economy collapsed by creating hyperinflation and a humanitarian crisis the left millions of people struggling to meet
their basic needs, such as food, medicine and consumer goods. Inflation has reached 1 million percent at the end of 2018,
creating a scarcity of imported goods.
 Civil rights are constitutionally guaranteed and are largely respected. However, the weakness of the judiciary curtails the
state’s ability to respond to violations of these rights.

Special note for other risk countries with an overall score above 60
o Greece
o Micronesia (Federal States of)
o Palau
o Seychelles
o Tuvalu

Greece

Greece became a Risk Country in 2018 when its overall risk fell to 58.06. The score has increased in the last 2 years to 61.74
but Greece is still considered as a Risk Country because 3 of the 6 indicators are below 60.

 The eight-year Greek debt crisis formally ended in 2018 but the government still faces an enormous level of general
government debt. Macroeconomic stability has been restored and fiscal measures have been adopted for the economy but
there are still many measures to take to transform the country
 The judiciary is independent but also inefficient and slow. Tax corruption and evasion is a serious problem in Greece,
representing a high risk for companies.
 In March 2016, The European Union and Turkey have concluded an agreement, limiting the number of refugees arriving in
Greece, but North Macedonia closed its south border the same month, leaving a substantial number of migrants blocked in
Greece. The officials struggled to process asylum claims in a timely manner.

Micronesia (Federal States of)

Micronesia’s overall score is slightly lower than last year and three of the six indicators are considered as a risk, namely
Government Effectiveness, Regulatory Quality and Rule of Law.

 Corruption is one of the main sources of public discontent with frequent complaints of misuse of public resources. The
governmental entities combatting corruption are independent and fairly effective apart from a few reportedly corrupt
officials.
 Basic standards for working conditions are implemented but migrant workers remain vulnerable to exploitive labour
practices.
 The judiciary system is constitutionally independent but slow an underfunded.
 Setting up private business is difficult due to a poorly developed regulatory infrastructure. The public sector is Micronesia’s
largest employer.

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Palau

Although Palau’s overall score is improving, Palau remains a Risk Country because of the indicators Government Effectiveness,
Regulatory quality, Rule of Law and Control of Corruption.

 The United States and Palau have concluded the Compact of Free association since Palau’s independence in 1994,
enabling close military and economic relations with the US.
 The judiciary is independent and has integrity. Freedom of assembly is protected by the constitution and non-governmental
organizations operate freely.
 High official politicians have faced corruption charges in recent years, and several have been convicted. In 2017, the
Finance minister reiterated the government’s ethics rules and a whistle blower protection policy.
 In October 2018, the European removed Palau from its list of tax havens due to the policies the government has promised
to take.
 No gross human rights’ abuses were identified in 2018 but there are human rights concerns such as assuring rights of
children, addressing gender-based violence and tackling human trafficking, especially human trafficking of foreigners.
 The tourism sector boosts Palau’s economy.

Seychelles

Seychelles’ overall score is continuing to improve and although three indicators are still scored below 60, they are also
improving over the years. The indicators considered as risk are Voice & Accountability, Regulatory Quality and Rule of Law.

 During the presidential election in 2015, narrowly re-electing the President Michel, claims of harassment and intimidation of
candidates and allegations of vote buying were made. However, in 2016, an opposition coalition won the election for the
National Assembly, increasing political pluralism and leading to the resignation of the President.
 In 2016, the National Assembly passed an anticorruption law establishing the first independent anticorruption commission
in the country, and strengthened the legal framework to fight corruption, but only a few investigations have followed.
 Journalists often self-censor themselves and newspapers often take political sides, so reporting is often biased.
 Seychelles does not have enough judges and has to bring judges from abroad. The government controls the contracts of
the expatriates, impartiality of non-Seychellois judges is therefore compromised.
 There are many bureaucratic and procedural hurdles to set up a company and the labour market is not fully developed.
 Migrant workers lack certain legal protections and remained vulnerable to abuses, particularly in the Seychelles
International Trade Zone.

Tuvalu

Tuvalu’s overall score is improving but remains a Risk country because following indicators still demonstrate a risk: Government
Effectiveness, Regulatory Quality and Control of Corruption.

 Tuvalu is a parliamentary democracy, holding regular, competitive elections.

 In July 2017, an election was held to replace the former Prime minister Ielemia, removed from Parliament in 2016 after a
corruption conviction. The legitimacy of the vote was disputed, as Ielemia’s conviction had been overturned and he was
challenging his removal in the courts.
 Ongoing problems include a lack of anti-discrimination laws to protect women and LGBT people.
 A move to add two seats to parliament reserved for women was considered as part of a constitutional review process set
to conclude in 2019.
 The highest point of Tuvalu being at only 4.5m above sea level and so Tuvalu’s politicians campaign against climate
change.
 There are no streams or rivers so collecting water is essential. Increasing salination of the soil threatens traditional
subsistence farming.

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Sources:

o Freedom House
o Index of Economic Freedom
o Gan Business Anti-corruption portal
o Transformation Index BTI
o Human Rights Watch World Report
o Reporters Without Borders World Press Freedom Index
o The Washington Post
o The Economist

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