By GlobeNewswire, October 01, 2013, 06:30:00 AM EDT
LONDON, Oct. 1, 2013 (GLOBE NEWSWIRE) -- In contrast to the usual cycle of war, disease and famine, Sub-Saharan Africa shows the budding shoots of promise, according to experts in the third issue of Resilience magazine, the risk management publication from Willis Group Holdings (NYSE:WSH), the global risk adviser, insurance and reinsurance broker.
"The people of Africa are demanding a better quality of life, embracing technology and understanding the power of the vote, pushing their leaders to deliver more. As a consequence peace reigns in most countries, those attending school is at record highs, HIV has fallen by three quarters, life expectancy has risen by a tenth in the past decade and foreign direct investment has tripled," according to William White, Executive Director in Willis International.
The engines for growth are expected to be the expansion of agricultural production, robust growth in services and a rise in oil production and mining. At the same time, insurance has a key role to play in facilitating the development of these sectors, according to Willis. "Insurance brings risk assessment, discipline and knowledge. And by de-risking, insurance enables investments to be made that may not otherwise have been feasible," said Julian Roberts, Executive Director of agri-business at Willis. "Crop insurance has a great deal to offer and will have a much greater role to play in Africa in the future."
High commodity prices in recent years have driven economic growth in many African countries. Others stand to join them: Mozambique and Tanzania are set to become major exporters of natural gas; Guinea and Sierra Leone could become huge iron ore exporters. Although interest has cooled in the past 12 months as commodity prices have reduced, long-term prospects are good, said Andrew Wheeler, Mining Practice Group leader at Willis. "Africa has world-class deposits in minerals that are increasingly becoming scarce elsewhere, or that only exist in the region," he added.
To take part in Africa's growth story, foreign companies must assess and mitigate myriad risks. Political risk remains a primary concern for businesses in Africa. As democracy has put down deeper roots, coups and civil war have become less frequent. But ethnic, religious and socio-economic rifts still give rise to terrorism and political violence.
Some people in Africa have interpreted the return of companies as a form of "neo-colonialism", according to Tim Holt, Head of Intelligence for Alert:24, a risk and crisis management consultancy from Willis Special Contingency Risks. "Chinese companies and investment, for example, have flowed into parts of Africa, and while they were initially welcomed with open arms, we now see some resentment. Countries are happy for the investment but there are always suspicions that foreign companies will want to come in, take the resources out, and leave environmental damage behind."
A sample of other articles from this issue of Resilience includes:
1. Europe's defining moment: With the Eurozone in crisis and political uncertainty spreading, those companies that are the most ambitious and entrepreneurial in their approach to risk management will be the winners, according to Jorge Luzzi, president of the Federation of European Risk Management Associations (FERMA).
2. Terrorism Cover: Risk managers must understand different risk pools' triggers and definitions of terrorism to identify their gaps in cover. "Several of the world's long-established terrorism insurance schemes were set up to deal with a different terrorism threat than is predominant today," said James Borrie, Executive Director in Willis's Terrorism and Political Violence Practice.
3. Fraud in a downturn: Companies must improve their internal processes and work cultures as fraud grows more rife and complex. "Fraud is not confined to any one particular business sector: organisations in the private sector, government bodies or those working in the third sector all have to contend with fraud on a daily basis. Unless they proactively seek to understand and mitigate the risk it poses, they could suffer financially," said Leslie Wright, Executive Director in Willis's Financial and Executive Risks Practice.
4. To err is human: Employers should regularly monitor their employees' behaviour before incidents turn to serious accidents. "A firm may be extremely vigilant about implementing safety rules to prevent accidents but, over time, despite all its best efforts, employees may start to apply the rules less strictly," said Eric Joost, Chief Operating Officer of Willis North America and Chief Executive Officer of North America Specialties at Willis.
5. Antarctic exploration: The Willis Resilience Expedition is an ambitious undertaking by 19 year old Parker Liautaud who will trek 397 miles (640km) in freezing temperatures for 22 days and attempt to break the world record for skiing to the South Pole.
Willis Group Holdings plc is a leading global risk advisor, insurance and reinsurance broker. With roots dating to 1828, Willis operates today on every continent with more than 17,000 employees in over 400 offices. Willis offers its clients superior expertise, teamwork, innovation and market-leading products and professional services in risk management and transfer. Our experts rank among the world's leading authorities on analytics, modelling and mitigation strategies at the intersection of global commerce and extreme events. Find more information at our website, www.willis.com, our leadership journal, Resilience, or our up-to-the-minute blog on breaking news, WillisWire. Across geographies, industries and specialisms, Willis provides its local and multinational clients with resilience for a risky world.
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Source: Willis Group Holdings