The importance of logistics in
a global market place is once
again emphasised in the fifth
annual Allianz (AGCS) Risk
Barometer, in which 38% of
companies have identified
business interruption
– which includes supply chain
disruption – as the major
threat in 2016.
This is the fourth year
in succession that business
interruption has ranked
as the top threat by 800
risk managers and
corporate insurance
experts from more
than 40 countries,
including South
Africa.
In contrast, 46% of
respondents in the marine and
shipping sector listed market
developments (volatility,
intensified competition,
market stagnation) as the
top risk, followed by theft and
corruption (33%) and then
business interruption (31%).
“The Baltic Dry Index – the
global freight rate index for
dry bulk shipping – recently
plummeted to its all-time low,
meaning freight and charter
rates for dry bulk vessels are
as low as ever, “ says Sven
Gerhard, global product leader
hull and marine liabilities at
AGCS.
“Often the charter income is
below the vessel’s operational
expenses. Lower commodity
demand in China but also
overcapacities in the worldwide
fleet are contributing to this.
Many container liner operators
announced losses for Q3 2015
and the situation with crude
tankers is similar,” he says.
As a result shipping lines
will find it difficult to raise
finance, he adds.
Larger corporates seem to
be the most exposed to the risk
this poses to
supply chains.
Some 43% of companies
with turnover of more than
R9 billion listed business
interruption as the greatest
risk in 2016, with 30% of
smaller companies identifying
it as a risk.
South African respondents
listed cyber incidents (42%)
ahead of business interruption
(32%), followed by changes in
legislation (26%) as the main
risks.
Theft, fraud and corruption
was listed by 16% of South
African respondents as the
main risk.
