The world does not face the number or level of risks reported by the media, a leading risk consultant told the World Travel and Tourism Council Summit in Madrid yesterday.
But the slowdown of China’s economy does pose a risk to the global economic recovery.
Richard Fenning, chief executive of global risk consultancy Control Risks, described the Chinese slowdown, and how the government in Beijing handles it, as “the biggest risk” facing the industry.
He told the Summit: “We’re generally fed a diet of crisis and disruption and bad things. In the last year we’ve had a deluge of geopolitical disruption.”
But he insisted: “There is a huge amount of good news in the resilience of even the most tricky countries.”
Fenning suggested the threat of Islamic State in Iraq and Syria was “likely to run on” only in Syria, arguing:
“Islamic state is not a problem likely to consumer the region.”
At the same time, he said: “There is a once in a lifetime opportunity to redesign the Middle East through the readmission of Iran as an oil and gas producer and as a destination..”
He described relations between Russia and the US and European Union over Ukraine as “a dialogue of the deaf”, but suggested a “low compromise” was achievable and said: “I don’t think Russia has territorial ambitions beyond its borders.”
Turning to the Ebola crisis, Fenning noted: “The countries affected were those least able to cope with the crisis, but they have, and Nigeria managed to stop an outbreak developing.”
He said: “The biggest risk facing us is that the Chinese government will not be able to handle the disruption [of a slowdown].
“The country is used to levels of growth of 10%-12%. It has to get used to rates of 6%-7%. The economy has to move from investment to consumption.
“We all depend on China being successful in moving to a lower growth rate. It is the one factor that could knock the economic recovery off course. All other problems are containable.”
However, Fenning expressed optimism that even China would not derail global growth for long, saying: “It is our interdependence – illustrated by the fact that China lends money to the US to guard China’s oil supplies [in the Middle East] – that in the long run guarantees our prosperity.”
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