Executive Briefings

Crime, Weather, Terrorism, Migration Crisis Cost Global Supply Chains $56Bn Last Year, Study Says

Research from the British Standards Institute (BSI) has found that global supply chains gained a combined $56bn in extra costs last year, incurred by crime, extreme weather, terrorist threats and the migrant crisis that swept across Europe.

Crime, Weather, Terrorism, Migration Crisis Cost Global Supply Chains $56Bn Last Year, Study Says

The true figures of cargo crime have been hard to come by, but the 2015 SCREEN Global Intelligence Report from BSI concluded that $22.6bn was lost globally due to cargo crime.

While the risk of theft is Europe has not been accelerating at the same rate, the region continues to suffer severe disruptions in trade caused by ISIS terrorist attacks and the migration crisis.

The reintroduction of border controls following the November attacks in Paris are estimated to have cost Belgian cargo owners $3.5m alone, and it estimated that if Schengen area border controls are permanently re-established, it would cost the German economy $25bn.

The report also found that the top five natural disasters last year, much of which were induced by the El Nino phenomenon, collectively caused $33bn damage to businesses – forest fires in Indonesia cost $16bn; the Nepal earthquake cost $4-5bn; the typhoon that destroyed swathes of China and the Philippines also had a $4bn bill with it; while floods in the US and India cost $4-5bn and $1.3-3bn respectively.

On top of that was the Tianjin explosion, which is now estimated to be the single most expensive industrial accident, killing 173 people and costing global supply chains $3.3bn, making it far more economically damaging than 1989’s Exxon Valdez spill.

Last year also saw considerable social unrest – factory strikes in China, for example, increased by 58.3 percent year-on-year.

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The true figures of cargo crime have been hard to come by, but the 2015 SCREEN Global Intelligence Report from BSI concluded that $22.6bn was lost globally due to cargo crime.

While the risk of theft is Europe has not been accelerating at the same rate, the region continues to suffer severe disruptions in trade caused by ISIS terrorist attacks and the migration crisis.

The reintroduction of border controls following the November attacks in Paris are estimated to have cost Belgian cargo owners $3.5m alone, and it estimated that if Schengen area border controls are permanently re-established, it would cost the German economy $25bn.

The report also found that the top five natural disasters last year, much of which were induced by the El Nino phenomenon, collectively caused $33bn damage to businesses – forest fires in Indonesia cost $16bn; the Nepal earthquake cost $4-5bn; the typhoon that destroyed swathes of China and the Philippines also had a $4bn bill with it; while floods in the US and India cost $4-5bn and $1.3-3bn respectively.

On top of that was the Tianjin explosion, which is now estimated to be the single most expensive industrial accident, killing 173 people and costing global supply chains $3.3bn, making it far more economically damaging than 1989’s Exxon Valdez spill.

Last year also saw considerable social unrest – factory strikes in China, for example, increased by 58.3 percent year-on-year.

Read Full Article

Crime, Weather, Terrorism, Migration Crisis Cost Global Supply Chains $56Bn Last Year, Study Says