A major European credit rating agency Scope Ratings GmbH released its report on sovereign external risks, noting that tighter global financial conditions and volatile global trading conditions have demonstrated this year that external vulnerabilities are again a significant source of risk in the world economy.
The report assessed countries by their vulnerability to balance of payment crises, their degree of resilience in the advent of crisis, and their economies’ exposures to contemporary trade disputes.
According to the report, some economies that are the most vulnerable to classical balance of payment risks are also interestingly those that are least-at-risk from current trade disputes – including Ukraine, Turkey and Georgia. Instead, economies with the largest trade surpluses with the US are the most at risk from trade conflicts, with China, Mexico, Ireland, Japan and Vietnam the most exposed in trade war exposure rankings.
In the report, Russia’s vulnerability score (10=least vulnerable, 0=most vulnerable) is 5.0 (number 54 in the ranking) with Switzerland being on top (8.5) and Georgia at the bottom (3.1). Its resilience score (10=most resilient, 0=least resilient) is 7.8 (position 12) with Japan scoring 9.6 (number 1) and Georgia 1.9 (number 63). By trade war exposure score (1=most exposed, 100=least exposed), Russia with 78.4 is numbered 48th, while Hong Kong with 94.2 is least and China with 24.2 is most exposed.