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Maplecroft release new in-depth country risk reports on Lebanon, Morocco and Nigeria

02/02/2011

Lebanon

Maplecroft’s in-depth Country Risk Report on Lebanon offers high-level analysis and maps of regime stability, political violence, the macroeconomic outlook, the regulatory and business environment, and labour rights.

The Lebanese government collapsed on 12 January 2011 as a result of long-standing tensions between Sunni and Shi’ite factions over the Special Tribunal for Lebanon (STL), which is investigating the assassination of former Prime Minister Rafiq al-Hariri. It is expected that Hezbollah will be indicted by the tribunal. A new prime minister, Najib Mikati, was appointed on 25 January and is currently attempting to form a new government; however, this is unlikely to happen quickly. If the STL makes its indictments public within the next few months, as is expected, then widespread political violence or all-out civil war could conceivably break out.

The close relationship which Lebanon enjoys with Iran – primarily via Hezbollah – poses risks to  companies that operate in the Lebanese economy. It is not yet entirely clear whether the government and banks of Lebanon will fully comply with the recommendations laid out by the UN’s June 2010 sanctions. The recommendations of the latest UN sanctions are not binding on Lebanese companies. However, the US and EU have unilaterally passed legislation which restricts trade financing and banking relationships with Iran.

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Morocco

Maplecroft’s in-depth Country Risk Report on Morocco offers high-level analysis and maps of the governance framework, corruption, regime stability, political violence, the regulatory and business environment, and the environment.

Recent instability across North Africa may affect Morocco too. Like Tunisians, Moroccans face serious limitations to their exercise of civil and political rights. Furthermore, although the unemployment rate fell to 9% in July-September 2010, large numbers of Moroccans struggle to find jobs which they believe match their qualifications. The potential for societal and political unrest is therefore a risk that business should monitor on an ongoing basis. As of late January 2010, the situation across North Africa is highly volatile and unpredictable. The consequences of a potential regime change in Egypt, the region’s largest and most important country, would likely be felt in Morocco through additional protests.

Corruption remains one of the primary obstacles to investment and economic development in Morocco, as it is a widespread problem across business, government and the judiciary. Potential allegations of association with corruption may expose businesses to legal and reputational risks. Foreign investors in Morocco should be vigilant in their dealings with public authorities as well as local business partners and along their local supply chain. Furthermore, there is growing recognition of the relationship between corruption and the violation of human rights. Where there is corruption, people are denied the possibility of benefiting fairly from the benefits of business investment.

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Nigeria

The Labour Standards Report on Nigeria offers in-depth analysis for all major labour issues, country scores, maps, key recent events and stakeholder viewpoints.

Principal companies that use large labour contracts with independent companies face reputational risks of complicity in labour rights abuses. This is because these independent companies hire their workforce on short-term contracts. Short-term contracts are not protected against low and inequitable wages, poor and unsafe working conditions, and are often denied the right to freely associate and bargain collectively. Furthermore, such a personnel policy may foment industrial unrest as contract workers agitate for unionisation and more equitable treatment.

Nigeria has also witnessed a period of sustained industrial unrest as dismayed workers have protested against the government’s repeated failure to increase the minimum wage. In the light of recent countrywide industrial action, businesses may be confronted with costly disruptions to production and adverse impacts on revenues as vital public and financial services, including banks, public administrative authorities and transport networks are interrupted.

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In-depth reports contain detailed analysis, country scores, maps, key recent events and stakeholder viewpoints. They are available for all countries, sectors and issues. Please contact info@maplecroft.com for more information.