Geo-Political Risk | Mapping your risk

Geo-Political Risk Map | Current Intelligence

Investing or operating in adverse business environments or foreign jurisdictions is a daunting proposition for businesses, the financial rewards can be staggering but the geo-political risks can equally be devastating. Environmental conditions, shifting regulations, political fluctuations and cultural changes are all risks that an organisation will face over time.

Collecting reliable geo-political risk intelligence on diverse business customs, fraud risks, corruption levels, political influences and the regulatory environment enables clients to seize opportunities with assurance in these jurisdictions.

An analysis and an interactive geo-political risk map covering some of the key jurisdictions where we have recently performed due diligence and investigations, can be found below (click on a country in solid blue):

Geo-Political Risk Map | Version 1 | Accurate as of April 2020

Albania

Geography

Albania is located in Southeastern Europe on the Adriatic and Ionian seas, bordering Greece to the South, Kosovo and Montenegro to the North and North Macedonia to the East. The main ports in Albania are Durrës, Vlorë, Shëngjin, Sarandë.

Society

Albania has a population of 2.8 million with a current growth rate of -0.1% per year. The ethnic majority in Albania is ethnic Albanian: 82.6% and 15% are marked as unspecified due to ethnic sensitivity, shared between recognised minorities: Greeks, Montenegrins, Macedonians, and others. Religious division: 56-58% Muslim, Christian 17%.

Government

Albania’s capital city is Tirana. It is a parliamentary republic; administratively divided into 12 counties. The Head of Government is the Prime Minister Edi Rama (since 2013). The Council of Ministers is proposed by the prime minister, nominated by the president, and approved by the Assembly.

Political & Business Risks

The Government is focused on increasing fiscal and legislative reforms, stricter tax collection to make up for budget deficit. The economy challenges include low levels of participation in the formal labour sector and limited links with external markets. Internal political tensions between the opposition and the ruling party have intensified and are slowing reforms. Weak checks and balances and public sector corruption impede Albania accession to the EU. Developed channels for trafficking of humans, tobacco, illicit drugs are among the biggest security threats in the country.

In June 2019, Albania has adopted the Moneyval legislative package providing more transparency into beneficial ownership and establishing control over preventive freezing and seizing of assets of natural and legal persons suspects to criminal offences. Along this framework, Albania has strengthened its anti-terrorism financing and anti-money laundering efforts. However, law enforcement remains the weak spot in the state struggling to persecute active and passive bribery under the country’s criminal code.

Economy

GDP composition by sector: services (54.1%), industry (24.2%), agriculture (21.7%) Major industries: agriculture, retail, lumber, oil, cement.

Top 5 export partners: Italy, Serbia, Spain, Greece, Germany

Top 5 import partners: Italy, Turkey, Germany, Greece, China

The agricultural sector, which accounts for more than 40% of employment is limited primarily to small family enterprises and farming, due to lack of modern equipment and disputes on property rights. Complex tax codes, a weak judicial system, poor enforcement of contracts and property issues contribute to Albania’s poor business environment.

Financial Regulators

AMF – Financial Supervisory Authority

BOA – Bank of Albania

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Bahamas

Geography

The Bahamas are a chain of islands in the North Atlantic Ocean, southeast of Florida, northeast of Cuba in close proximity to the US. Port Nassau and Freeport are its major cargo ports.

Society

The Bahamas current population is around 337,721 with a current growth rate of +1% per year. The majority of the population lives in urban areas, with two thirds living on New Providence Island where Port Nassau is located. According to UNAID, between 5300-6700 people are living with HIV. The ethnic majority is of African-American descent: 90.6% and the religious division is: Protestant 69.9%, Roman Catholic 12%, other Christian 13%.

Government

The Bahamas are a member of the Commonwealth, a parliamentary democracy under a constitutional monarchy with capital Nassau; administratively divided by 31 districts. Head of government is Prime Minister Hubert Minnis. The Prime Minister and cabinet are subject to a Lower House of Parliament and a Senate.

Political & Business Risks

Natives are fearful of growing influx of illegal immigrants (around 30,000 Haitians) who remain unchecked by authorities for diseases such as AIDS and tuberculosis. Growing violent crime rates remains a substantial security issue. OECD demands higher checks and balances by tax authorities as Bahamas remain a major hub for illicit trafficking to the US and Europe.

The Bahamas have no corporate, income, or capital gains taxation. In 2017, two anti-corruption pieces of legislation were adopted in the Bahamas – the Ombudsman Bill – setting up a body to arbitrate complaints by government maladministration; and the Integrity Commission Bill – setting up a body to investigate corruption and public disclosure.

Economy

Tourism (50%), international banking and investment management (20%) comprise the major part of the islands’ GDP. The services sector has been growing in recent years, moving people from rural areas (fishing and farming villages) to commercial centres in New Province Island, Grand Bahamas and Great Abaco.

The Bahamas has a large open-registry shipping fleet and the offshore sector is dis-proportionally large.

Top major import (83.2%) and export (63.9%) partner of the Bahamas is the US.

Financial Regulators

SCB – Securities Commission Bahamas

CBB – Central Bank of Bahamas

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Barbados

Geography

Barbados is the easternmost island in the Caribbean, located in the North Atlantic Ocean, northeast of Venezuela. The major port is Bridgetown.

Society

Barbados has a population of 294,560 with a current growth rate of +0.3% per year. A third of the society lives in urban areas, mainly in the capital of Bridgetown. The ethnic majority is of African-American descent: 92.4%, the religious division is: Protestant (66.4%), Roman Catholic (3.8%), other Christian (5.4%), none (20.6%).

Government

Barbados is a member of the Commonwealth, a parliamentary democracy under a constitutional monarchy. The head of government is Prime Minister Mia Mottley (2018), subject to a bicameral Parliament – Senate and House of Assembly.

Political & Business Risks

There is a growing tension between the minority white community which is owning and controlling a major portion of the economy and the majority native population with dissimilar access. Illicit drug trafficking and Barbados’ role as trans-shipping point for illicit drugs are among the main risks to the state and business. More efforts are needed in adopting stricter regulations in anti-money laundering procedures, most of which adopted by the banking sector. The pace of privatisation has been slow creating financial pressure.

Barbados is one of the least corrupt countries in the region. In December 2019, Barbados adopted the Prevention of Corruption Bill revisiting and strengthening the persecution of bribery of public officials; trading in influence as well as bribery related to contracts and tenders making up for the country’s efforts to tackle corruption.

Economy

The service sector is accountable for 83.7% of the GDP of Barbados, where the tourist industry plays a significant role. Manufacturing employs 6.3% of the workforce and accounts for 6% of the GDP.

Major export partners: US 38%, Trinidad and Tobago 10.2%, Guyana 5.5%, Jamaica 5%, China 4.8%, St. Lucia 4.6%

Major import partners: US 38.5%, Trinidad and Tobago 14.6%, China 7.1%, UK 4.7%.

Financial Regulators

FSC – Financial Services Commission

CBB – Central Bank of Barbados

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Botswana

Geography

Botswana is located in Southern Africa, bordering Zimbabwe on the north east, South Africa on the south; Namibia on the West, Angola and Zimbabwe on the north.

Society

Botswanian society is concentrated around the capital of Gaborone and Francistown on the east. Botswana has a population of approximately 2,317,233 with a current growth rate of +1.8% per year. According to UNAIDS, between 330,000 – 400,000 adults and children are living with HIV. The ethnic majority is native Tswana 79%, followed by Kalanga 11%, Basarwa 3% and other. Major religion is Christianity: 79%.

Government

Botswana is a member of the Commonwealth, a parliamentary democracy, under a constitutional monarchy. The state is administratively divided between 10 districts and 6 town councils. The head of state is President Mokgweetse Eric Masisi who is indirectly elected by the National Assembly.

Political & Business Risks

Poor infrastructure is the source of many issues for private enterprises in Botswana, alongside the lack of credit loans. Botswana has a tiny domestic market which struggles to attract foreign investors.  Programmes have been developed to improve the reliability of electricity supplies and the quality of the water system.

Corruption is predominantly linked to nepotism and patronage in the government sector, making it a considerable risk for public tenders. Bribery in acquiring public services is the lowest in the African continent.

The Penal Code and the Corruption and Economic Crime Acts are the primary pieces of legislation covering abuse of power, as well as active and passive bribery of officials. Misappropriation in the private sector is criminalised by the Penal Code but limited to directors and officers of companies.

Economy

Botswana is the world’s leading diamond producer. Diamond mining currently accounts for 25% of GDP and approximately 85% of export earnings. The agricultural sector employs 32% of the workforce.

Major export partners: Belgium 20%, India 13%, UAE 13%, South Africa 12%, Singapore 8%, Israel 7%, Hong Kong 4%, Namibia 4%

Major import partners: South Africa 66%, Canada 8%, Israel 5%.

Financial Regulators

NBFIRA – Non-Bank Financial Institutions Regulatory Authority

BOB – Bank of Botswana

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Jamaica

Geography

Jamaica is an island located in the Caribbean Sea south of Cuba. Major ports include Discovery Bay (Port Rhoades), Kingston, Montego Bay, Port Antonio, Port Esquivel, Port Kaiser and Rocky Point.

Society

Jamaica has a population of approximately 2,808,570 with a current growth rate of +0.3% per year. Majority of society is of African-American descent: 92%. Religious division is predominantly Protestant: 65%, 21% none and other.

Government

Jamaica is an independent member of the Commonwealth with Prime Minister Andrew Holness (since 2016)  and cabinet who are drawn from a 63-member House of Representatives. The governor-general, who represents the Crown, has only formal functions. There is a 21-member Senate, whose functions are mainly advisory.

Political & Business Risks

Jamaica has a high rate of politically-linked drug gangs accountable for a major part of violent crime, damaging the economy. The country is a major transitory link for cocaine from South America to North America and Europe. Colombian narcotics traffickers favour Jamaica for illicit financial transactions. Sex trafficking, human trafficking, forced child labour, corruption and money laundering are prevailing issues for society and state. The health of the banking industry is gradually improving but growth of credit is extremely slow.

In 2016, Jamaica adopted the Integrity Commission Act adding to existing measures in the fight against corruption by appointing independent commissioners, including a representative from civil society. The focus falls on anti-corruption risk strategies and public education to increase awareness in the government procurement system. A few commissioners have so far resigned from the Commission.

Economy

Agriculture employs 16% of the population and accounts for 10% of GDP. The service sector, dominated by tourism, accounts for 68% of GDP.

Major export partners: US – 39%, Netherlands 12%, Canada 8%.

Major import partners: US 40%, Colombia 7%, Japan 6%, China 6%, Trinidad and Tobago 5%.

Financial Regulators

FSC – Financial Services Commission

BOJ – Bank of Jamaica

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Mauritius

Geography

Mauritius is comprised of a group of islands lying in the Indian Ocean, off the eastern coast of Madagascar. The major port is Port Louis.

Society

Mauritius has a population of approximately 1,379,365 with a current growth rate of +0.1% per year. The ethnic division is Indo-Mauritian (66%), Creole, Sino-Mauritian, Franco-Mauritian (last index: 1972). Major religions: Hindu 48%, Roman Catholic 26%, Muslim 17%, other Christian 6%. English is the official language which less than 1% of the population speaks. The majority of the population speaks Creole.

Government

The president is elected for a five-year term by the unicameral parliament. The National Assembly has up to 70 members; 62 are elected by universal for five-year terms, and up to 8 additional seats are allocated to allow representation of a variety of ethnic groups. The current President is Pritivirajsing Roopun.

Political & Business Risks

Mauritius is a monitored entity on reports of money laundering taking place in its banking, offshore and non-banking sectors. The major sources of laundered funds in Mauritius are crimes involving drug trafficking, forgery, Ponzi schemes, and corruption. The former president resigned over a credit card scandal. Operation of the political system is sometimes hampered by serious differences between the minority Creoles and the dominant Hindus.

Mauritius adopted The Prevention of Corruption Act in 2002 criminalising bribery, conflict of interest and use of office for gratification. The Independent Commission Against Corruption deals with both public and private corruption offences. Mauritius has a comprehensive legal framework covering the seizing of assets due to terrorist offences or unexplained wealth and has put in place anti-money laundering mechanisms. Improving integrity and implementing efficiently anti-corruption measures is an ongoing process for Mauritius.

Economy

Services make up to 75% of the GDP and the offshore sector accounts for 5%. Predominantly public enterprises benefit from credit lending. Multinational businesses, hedge funds and other foreign investors use the island for its low-tax platform for doing business.

Financial Regulators

FSC – Financial Services Commission

BOM – Bank of Mauritius

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Pakistan

Geography

Pakistan is located in Southern Asia, bordering the Arabian Sea, between India on the east and Iran and Afghanistan on the west and China in the north. Major ports include Karachi and Muhammad Bin Qasim.

Society

Pakistan’s population is approximately 233,500,636 million with a current growth rate of +2.0% per year. It is the fifth most populous country in the world. Ethnic division in Pakistan: Punjabi 44%, Pashtun 15%, Sindhi 14%, Saraiki 8%, Muhajirs 7%, Balochi 4%, other 6.3%. Official languages are English and Urdu, however a large portion of society speaks Punjabi.

Government

The Islamic Republic of Pakistan is a federal parliamentary republic and an independent member of the Commonwealth, whose president is elected by the Senate. The National Assembly has 342 members, elected for 5-year terms; there are quotas for non-Muslim minorities and women for each province. The Senate has 100 members, elected for 6-year terms. The current head of state is President Arif Alvi and Imran Khan is head of government.

Political & Business Risks

Government-initiated reforms to reduce the cost of setting up businesses and improve private sector access to credit are underway. The IMF is engaged in restructuring the financial sector to help its modernisation. Greater exchange rate flexibility is needed to improve competitiveness. However, security concerns related to terrorism as well as fuel shortages mark a fragile economic environment.

Pakistan is a major transit area for illicit drug trafficking from Afghanistan to Iran, Western markets, the Gulf States, Africa and Asia.

Financial crimes related to drug trafficking, human trafficking, terrorism, tax evasion, corruption, and smuggling remain significant alerts to business climate and state development. Pakistan has adopted The Prevention of Corruption Act and the National Accountability Ordinance as main pillars in the anti-corruption legislation framework. Active and passive bribery, embezzlement, bribing a foreign official, abuse of office, and money laundering are illegal.

The two pieces of legislation can see companies held accountable in addition to natural and legal persons in possession of unexplained assets.

Economy

Pakistan’s demographic challenges press for the implementation economic reforms, promotion of further development of the energy sector, and attraction of foreign investment to support sufficient economic growth necessary to employ its rapidly growing population. The China-Pakistan Corridor initiative sees large financial investment in the energy sector of Pakistan which is expected to contribute to over 6% of the GDP mainly through increased means for export.

Financial Regulators

SECP – Securities & Exchange Commission Pakistan

SBP – State Bank of Pakistan

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Panama

Geography

Panama is located in Central America, bordering both the Caribbean Sea and the North Pacific Ocean, between Colombia and Costa Rica. The country’s busiest ports are Colon and Balboa.

Society

The Panama population is approximately 3,894,082 with a current growth rate of +1.6% per year. Ethnic division in the society is Mestizo 65%, Native American 12%, African-American descent 9%, white 7%. The official language is Spanish. The religious division in the society is Roman Catholic 85% and Protestant 15%.

Government

Panama is a presidential republic with capital Panama city and 10 administrative divisions. The head of state is President Laurentino “Nito” Cortizo Cohen (since 2019). The unicameral National Assembly has 71 seats.

Political & Business Risks

Panama continues to be a major transition point for illicit drug trafficking from Colombia. Tax compliance level is insufficient to contribute for state economic performance. Panama remains is an offshore zone and a primary money laundering centre for illicit drugs revenues especially in the Colon Free Zone. Corruption in the public sector remains a serious problem for state development and compliance with international regulations.

Bribery and corruption involving officials is held accountable under Panama’s Penal Code, with a very low rate of sentences. Only the National Assembly can initiate an investigation against the Supreme Court and only the Supreme Court can suggest an investigation against the National Assembly. Panama has seen various cases of high officials engaged in corruption and is in the process of establishing efficient checks and balances.

Economy

The service sector accounts for 67% of GDP. Services include the Panama Canal operation, container port activities, shipping, insurance, wholesaling, ship registry and distribution out of the Colon Free Zone. Panama hosts 110 international banks, making it an attractive industry. The Panama government’s initiative for free-trade agreements attract foreign investors focusing on the region.

Major export partners: the US 19%, the Netherlands 17%, China 6%, Costa Rica 5%, India 5%, Vietnam 5%

Major import partners: the US 25%, China 10%, Mexico 5%.

Financial Regulators

SBP – Superintendency of Banks of Panama

NBP – National Bank of Panama

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US Virgin Islands

Geography

The US Virgin Islands are in the Caribbean Sea and the Atlantic Ocean, east of Puerto Rico and west of the British Virgin Islands. The territory consists of four main islands: Saint Thomas, Saint John, Saint Croix and Water Island, as well as several dozen smaller islands. Major seaports include Charlotte Amalie, Christiansted, Cruz Bay, Frederiksted, Limetree Bay.

Society

The US Virgin Islands population is approximately 106,235 with a current growth rate of -0.2% per year. Ethnic composition of the society: 76% African-American descent, white 15%, Asian 1.5% and other. Major language is English, but Spanish, French, Spanish Creole and French Creole are also spoken in the country. Religious division: Protestant 59%, Roman Catholic 34% and other.

Government

The US Virgin Islands are an incorporated organised territory of the US with local self-government headed by President Albert Bryan (since 2019). Residents cannot vote in US presidential elections, but can vote for US Democratic or Republican primary elections and elect one delegate for US Congress. There is a unicameral legislature composed of 15 senators elected for 2-year terms.

Political & Business Risks

The US Virgin Islands territory is rated as a moderate risk country for money laundering. It is an offshore zone offering tax-free entities under a US flag. Mutual evaluation by FATF for 40+9 recommendations has not been completed.

Economy

Tourism accounts for about 80% of GDP and provides employment for a majority of the workforce. Nearly 2.5-3 million tourists visit the island in a typical year. International business and the financial sector are small but steadily growing. Industry and government account for 20% each to the GDP.

Financial Regulators

LGDBIF – Lieutenant Governor’s Division of Banking, Insurance and Financial Regulation

VIDF – Virgin Islands Department of Finance 

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Bermuda

Geography

Bermuda is a group of islands located in the North Atlantic Ocean. Major ports include Hamilton, Ireland Island and Saint George.

Society

Bermuda has a population of approximately 71,750 with a current growth rate of +0.2% per year. Ethnic division: African descent 53.8%, white 31%, mixed 7.5%, other 7.1%. Religious division: Protestant 46.2%, Roman Catholic 14.6%, Jehovah’s Witness 1.3% The official language is English, but Portuguese is also spoken across the islands.

Government

Bermuda is a UK overseas self-governing territory, a parliamentary democracy with capital Hamilton. The head of Government is Premier David Burt. The House of Assembly has 36 seats, allocated by popular vote for a 5-year term. The Senate has 11 members, appointed by the governor, Premier and opposition.

Political & Business Risks

Discrimination over the African descent majority is prevalent in the private sector. Bermuda is one of the biggest offshore zones, susceptible to money laundering and tax evasion. There are major concerns are over internal market drug trafficking and money laundering through the official banking system. In 2017 Bermuda adopted the Bribery Act covering bribingbeing bribedbribery of foreign public officials, and a corporate offence of failing to prevent bribery completing a robust legislative framework. The law concerns both public and private sector and both natural and legal persons.

Economy

Insurance and financial services make up to 80% of Bermuda’s GDP and tourism accounts for 5% of the GDP, but employs a significant part of the society.

Financial Regulators

BMA – Bermuda Monetary Authority 

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Cyprus

Geography

Cyprus is an island located south of Turkey in the Mediterranean sea. Major ports under government control: Larnaca, Limassol, Vasilikos. Major ports under Turkish Cypriot control: Famagusta and Kyrenia.

Society

Cyprus has a population of 1,266,676 with a current growth rate of +3.9% growth rate per year. In terms of ethnic division, data is only available for the Greek-Cypriotic part of society: 98.8% Greek, 1% other (Armenian, Maronite, Turkish-Cypriot).

Government

The state territory is divided between Turkish Republic of Northern Cyprus (recognised by Turkey) and Republic of Cyprus. 

President Nikos Anastasiadis, head of state and head of government, elected by absolute majority. The Turkish Cypriot Community does not occupy their reserved vice-presidential post. There are 6 administrative divisions in the country: Famagusta (majority in the ethnic Turkish Cypriot community), Kyrenia (the only district located entirely in the Turkish Cypriot community), Larnaca (with a small part located in the Turkish Cypriot community), Nicosia (a small part administered by Turkish Cypriots), Lemesos and Paphos. Official languages: Greek and Turkish. Religious division: majority Orthodox Christian 89%.

Political & Business Risks

Cyprus is the site of a long-time conflict between Turkey and Greece, where the Turkish Cypriot area is not part of the EU. Cypriot financial and casino sectors are vulnerable to money laundering schemes; suspicious transactions in the offshore zone are largely unreported.

Corruption is at moderate risk, predominantly in the banking sector, public procurement sector and land administration. Cyprus is implementing anti-corruption and anti-money laundering laws and largely complying with FATF 40+9 recommendations. Cyprus does not have a unified anti-corruption and anti-bribery framework. The Criminal Code covers corruption involving public officials, foreign civil servants and employees of international organisations, as well as private sector agents and corporate entities.

Economy

The area of the Republic of Cyprus under government control is dominated by the services sector, accountable for 80% of total GDP. Tourism, finance, shipping and real estate provide for the biggest part of services and are the most important industries.Major export partners: Libya 9.5%, Greece 7.7%, Norway 6.7, UK 5%, Germany 4%. Major import partners: Greece 19%, Italy 7%, China 7%, South Korea 7%, Germany 7%, Netherlands 5%, UK 5%, Israel 4%.

Financial Regulators

CSEC – Cyprus Securities and Exchange Commission

CBC – Central Bank of Cyprus 

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Romania

Geography

Romania is located in Southeastern Europe, bordering Bulgaria on the South, Ukraine and Moldova on the North East, Hungary and Serbia on the West.

Society

Romanian society has a population of approximately 21,302,893 with a current growth rate of -0.7% per year. Ethnic division: Romanian 83%, Hungarian 6%, other (including Roma, Ukrainian and unspecified). Religious division: Eastern Orthodox 82%, Protestant 6%, Roman Catholic 4%.

Government

Romania is a semi-presidential republic with capital Bucharest. The chief of state is Klaus Werner Iohannis and Prime Minister is Ludovic Orban. The bicameral Parliament consists of Senate with 139 seats and a Chamber of Deputies with 329 seats.

Political & Business Risks

Romania’s judicial independence and reforms have been a serious impediment to economic growth. Nepotism and corruption in the public sector are prevalent. The government has been criticised of adopting legislation hindering judicial efforts at anti-corruption. Romania is a transshipping point for illicit drugs as part of the Balkan route from Southwest Asia. Illicit drugs expose Romania to money laundering via casinos, currency exchange houses and the banking sector. The Romanian Criminal Code is the  main anti-corruption legislative tool, covering bribery and influence trading offences. The law on preventing, discovering and sanctioning the corruption covers abuse of office and abuse of the financial interests of the European Union.

Economy

The services sector makes up for 66% of total GDP and occupies the largest part of the labour workforce. Manufacturing accounts for approximately 20% of GDP with growing automobile, car parts and engineering sectors. The mining sector is of concern because it is the source of much resistance to economic reform. Mines producing copper, lead, zinc, gold, silver and coal depend on substantial subsidies and are a door for corruption. Most of the major banks are foreign based with three of the four biggest ones originating from Austria. 

Top export partners: Germany 23%, Italy 11%, France 7%, Hungary 5%, UK 4% 

Top import partners: Germany 20%, Italy 10%, Hungary 7%, Poland 5%, France 5%, China 5%

Financial Regulators

ASF – Romanian Financial Supervisory Authority

BNR – Banca Nationala Romanei

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Russia

Geography

Russia is the largest state in Asia, bordering the Arctic Ocean, extending from Europe – west of the Urals to the North Pacific Ocean.

Society

Russian society is marked by a +0.1% growth, totalling 141,722,205 million. Ethnic society: Russians 85.7%, Tatar 3.2%, Chechen 1%, other 10%. Religious division: Russian Orthodox 15-20%, Muslims 10-15%, other Christian. Statistics are of practising worshippers – there is a large portion non-practising believers and non-believers. Official language is Russian, spoken by 85% of the population.

Government

Russia is a semi-presidential federation with capital Moscow. The Head of State is President Vladimir Putin (since 2012) and Head of Government is Prime Minister Dmitry Medvedev (since 2012). The elected President is appointed for a 6-year term and is subject to a Federal Assembly comprising of two chambers: 450-member state Duma, elected for a 4-year term and a 178-member Federal Council.

Political & Business Risks

Sanctions over the annexation of Crimea have slowed trade with Eastern Europe. Corruption, public funds misappropriation, tax crime and organised crime are major points of concern in anti-money laundering efforts. Public procurement and judicial corruption are ranked as high-level across the country.

Lack of transparency and steady increase of business maintaining costs impede competitiveness in the private sector. There is a large shadow economy largely based on cash flow. Effective enforcement of AML regulations is hindered by the judicial system’s close links to the government. 

The key anti-bribery legislation in Russia are the Anti-Corruption Federal Law, Code of the Russian Federation on Administrative Offences and the Criminal Code. Natural and legal persons are liable, as well as corporate entities, but sentences vary depending on the sum of the bribe and number of offenders, among others. A corporate entity may be released from liability if it assisted in disclosure, administrative investigation of the offence, investigation of the crime connected with the offence, or if a corporate entity is a victim of extortion. 

Economy

The services sector makes up 60% of GDP. The central bank’s bail out of three large private banks in 2017 points to fragility in the Russian banking system. Russia is rich in mineral and forest resources including iron ore, coal, copper, aluminium, manganese, salt and precious metals. 

Top export partners: China 10.9%, Netherlands 10%, Germany 7.1%, Belarus 5.1%, Turkey 4.9% 

Top import partners: China 21.2%, Germany 10.7%, US 5.6%, Belarus 5%, Italy 4.5%, France 4.2%

Financial Regulators

CBR – Central Bank of Russia

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South Africa

Geography

South Africa shares borders with Namibia in the northwest, Botswana and Zimbabwe in the north and Mozambique in the northeast. Lesotho and Swaziland exist as sovereign enclaves within South Africa.

Society

South Africa has a population of 56,463,617  with a current growth rate of +1.2% per year.

Ethnic division: black African 80.9%, coloured 8.8%, white 7.8%, Indian/Asian 2.5%

All spoken languages in South Africa are official languages: isiZulu 24.7%, isiXhosa 15.6%, Afrikaans 12.1%, Sepedi 9.8%, Setswana 8.9%, English 8.4%, Sesotho 8% and others

Religious division: 86% Christian, 1.9% Muslim, other.

Government

South Africa’s Head of State and Head of Government is Cyril Ramaphosa (since 2018). The National Assembly has 400 seats, appointed for a 5-year term by proportional representation. The National Council has 90 seats, appointed for a 5-year term by the provincial parliaments. The executive President is elected by members of the National Assembly for a five-year term of office.

Political & Business Risks

Tackling corruption and strengthening governance,  promoting competition in product markets, including the restructure of weak state-owned enterprises; advancing labour market reforms and enhancing the quality of education to foster job creation; and leveraging digitalisation are among areas for development for South Africa.

The country has a comprehensive anti-corruption legislative framework, most notably the Prevention and Combating of Corrupt Activities Act, which holds liable public officials participating in corruption. Hospitality expenses are not limited by law but need to be disclosed when exceeding the notion of ‘modest hospitality’. For legal entities, South African law does not recognise the absence of a compliance program as a crime.. 

Economy

South Africa has large resources of diamonds, iron ore, copper, manganese, platinum, limestone and chrome. The country has the world’s largest gold deposits and about 80% of world’s platinum reserves.

The services sector accounts for 72% of the GDP, industry 24% of GDP and agriculture 3%.

Top export partners: China 9.5%, US 7.7%, Germany 7.1%, Japan 4.7%, India 4.6%, Botswana 4.3%, Namibia 4.1%

Top import partners: China 18.3%, Germany 11.9%, US 6.6%, Saudi Arabia 4.7%, India 4.7%

Financial Regulators

FSCA – Financial Sector Conduct Authority

SARB – South African Reserve Bank

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British Virgin Islands

Geography

The British Virgin Islands are located in between the Caribbean sea and the North Atlantic Ocean, east of Puerto Rico.

Society

The British Virgin Islands has a population of approximately 37,381 with a current growth rate of +1.7% per year. Ethnic division: 76% of African descent, Latin American 5%, white 5% and others. Official language is English. Religious division: 70% Protestant, Roman Catholic 8.9%, Jehovah’s Witness, 2.5%.

Government

The British Virgin Islands are a self-governing UK overseas territory with a parliamentary democracy as a form of government and capital Road Town. The Head of Government is Andrew Fahie (since 2019). The House of Assembly consists of a Speaker elected by the House, 13 popularly elected members, and an Attorney General.

Political & Business Risks

The large offshore sector is vulnerable to money laundering and lacks transparency due to substantial beneficial ownership secrecy. The British Virgin Islands was partially compliant or non-compliant with 1 of the core FATF recommendations in 2019. The BVI, along with the UK’s other Overseas Territories, will be forced to create a public registry of company ownership by 2023 under Britain’s Sanctions and Anti-Money Laundering Act. The Criminal Code covers various offences in relation to bribery of government officials. The UK Bribery Act enacts strict liability on corporate inability to prevent bribery where the only defence is showing adequate compliance procedures. 

Economy

Approximately 30% of the GDP is accounted by the tourist sector. Business and financial sector account for almost 50% of the GDP. The islands are a major offshore business centre whose registrants are mainly originating from Latin America and Hong Kong. Growing competition in the offshore incorporation market has led BVI officials to look to other areas such as private wealth management. The government has a zero income tax regime. Other incentives include no capital gains tax, no estate duty, no dividend, no withholding tax, no capital transfer tax and no death duties.

Financial Regulators

BVIFSC – British Virgin Islands Financial Services Commission

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Cayman Islands

Geography

Located in the Caribbean sea, the Cayman Islands is a three-island group: Grand Cayman, Cayman Brac, Little Cayman, south of Cuba and northwest of Jamaica.

Society

The Cayman society is marked by a +1.3% population growth, totalling 61,944. Ethnic composition: mixed 40%, white 20%, African-American descent 20%, other 20%. Religious division: Protestant 68%, Roman Catholic 14%, Jehovah’s Witness 1.1%. Official language is English with 90% of population speaking it.

Government

The Cayman Islands are an overseas UK territory with capital George Town, located on Grand Cayman. Head of State is Queen Elizabeth (since 1952), represented by Governor Martyn Roper (since 2018). Head of Government is Aiden McLaughlin (since 2013). The Cabinet is appointed by a unicameral Legislative Assembly with 21 seats.

Political & Business Risks

The government has been under international pressure to improve the transparency and reporting standards of its financial sector due to tax evasion, corruption, money laundering and lack of collective investment vehicles measures. The Cayman Islands share tax information with the United Kingdom, France, Spain, Italy and Germany.

The Cayman Islands have an Anti-Corruption Commission working under the Anti-Corruption Law, which enables members of the public to file a report on suspicion of corruption or bribery. These adhere primarily to offences conducted by public officials and foreign public officials. The UK Bribery Act enacts strict liability on corporate inability to prevent bribery where the only defence is showing adequate compliance procedures. 

Economy

Tourism is the main source of income in the Cayman Islands employing 30% of the labour workforce.  Financial and insurance services accounts for over 50% of the GDP. The Cayman Islands has the largest offshore banking centre in the world with more registered businesses than people. The Caymans is also the second largest captive insurance base after Bermuda.

Financial Regulators

CIMA – Cayman Islands Monetary Authority

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Guernsey

Geography

Islands located in the English Channel, northwest of France. Major seaports include Braye Bay and Saint Peter Port.

Society

Guernsey has a population of approximately 67,052 with a current growth rate of  0.28% per year. The ethnic division is: Guernsey 52%, UK and Ireland 24%, Portugal 2%, Latvia 1.5%, other 6.7%. The languages spoken: English, French, Norman-French dialect. Religious division: Protestant and Roman Catholic (no data available on the percentiles).

Government

Guernsey is a parliamentary democracy under British crown dependency with capital Saint Peter Port. The Head of Government is Chief Minister Gavin ST Pier, subject to a unicameral States of Deliberation with 40 seats.

Political & Business Risks

There is domestic illicit drug related crimes and reports of money-laundering through the official public sector. As a major financial centre, Guernsey is vulnerable to financial related crimes. Under the Prevention of Corruption Law, bribery is a serious criminal offence which is punishable with up to 7 years imprisonment and an unlimited fine.

Both legal and natural persons are liable under this law. The UK Bribery Act enacts strict liability on corporate inability to prevent bribery where the only defence is showing adequate compliance procedures. 

Economy

Financial services, professional services, tourism, retail and the public sector in Guernsey are growing. Services make up 87% of the GDP and employ biggest portion of the labour force. Industry accounts for 10% of GDP, followed by a small agricultural sector 3%.

Financial Regulators

GFSC – Guernsey Financial Services Commission

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Isle of Man

Geography

The Isle of Man is located in the Irish Sea, between Great Britain and Ireland. Major ports include Douglas and Ramsey.

Society

The Manx society has a population of 90,499 with a current growth rate of +0.7% per year. Ethnic division: 96.5% white, Asian/Asian British 1.9%, other 1.5%. Languages spoken: English, Manx Gaelic (2%). Religious division: Protestant, Roman Catholic.

Government

The Isle of Man is a parliamentary democracy under British crown dependency with capital Douglas. Queen Elizabeth’s representative is Lieutenant Governor Sir Richard Gozney and the Head of Government is Chief Minister Howard Quayle. Legislative power is bicameral with a Legislative council of 11 seats and House of Keys with 24 seats.

Political & Business Risks

Isle of Man has a large financial centre potentially vulnerable to money laundering. Most of the illicit funds are from fraud schemes and drug trafficking from abroad, including the UK. AML regulations should be strengthened. Tax and cyber-crimes are growing. The Isle of Man’s Bribery Act of 2013 covers bribery offering, accepting a bribe, bribing a foreign public official and failing to prevent a bribe as criminal offences. The UK Bribery Act enacts strict liability on corporate inability to prevent bribery where the only defence is showing adequate compliance procedures. 

Economy

The services sector accounts for 86% of GDP, followed by industry 13% – mainly tourism and light manufacturing. Financial services’ growth is marked by low taxes and incentives to hi-tech companies and financial institutions. Agriculture, as a result, accounts for 1% of GDP.

Financial Regulators

IOMFSA – Isle of Man Financial Services Authority

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St. Kitts & Nevis

Geography

St Kitts and Nevis comprises the islands of St Christopher and Nevis, situated in the northern Leeward Islands, in the Eastern Caribbean. The two islands are separated by a 3km maritime strait.

Society

Kittitian-Nevisian society is marked by a +1% growth, totalling 53,821. Ethnic division: 93% African descent, others. Religious division: Protestant 75%, Roman Catholic 15%, others

The official language is English.

Government

St. Kitts and Nevis is a federal parliamentary democracy with Head of the Government Timothy Harris (since 2015) and capital Basseterre. There is a unicameral assembly with 14-15 seats, depending on Attorney General inclusion.

Political & Business Risks

St Kitts and Nevis is a transshipment point for South American illicit drug trafficking for the US and Europe. Banking reform allowed St Kitts to be removed from the OECD’s list of non-cooperative states in 2002. The island also successfully exited from an IMF-related monitoring framework in 2015. There are still areas for improvement with some money-laundering activity reported. The high level of non-performing loans in the banking sector is a concern. Government agencies involved in enforcement of anti-corruption laws include the Royal St. Kitts and Nevis Police Force, the Director of Public Prosecutions, and the Financial Intelligence Unit. Even though multiple laws are enacted to serve as a tool against official corruption, law enforcement remains weak. 

Economy

Agriculture contributes only a small portion of GDP (approximately 1%) and is spread around the coastal areas. The banking system is stable, though a few specific banks are still vulnerable. Nevis’ economy is based on tourism and offshore financial services, while St Kitts’ economy is larger and more diversified. Most commercial enterprises are privately owned, but a state corporation owns most of the arable land. The services sector accounts for 68.9% of GDP and industry for 30%.

Top export partners: US 49.6%, Poland 15.2%, Turkey 11.6%

Top import partners: US 56.8%, Trinidad and Tobago 6.8%, Cyprus 6.2%, Japan 4%.

Financial Regulators

FSRC – Financial Services Regulatory Commission

NEVISFSRC – Nevis Financial Services Regulatory Commission

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Jersey

Geography

Jersey is an island located in the English Channel, northwest of France. Major ports include: Gorey, Saint Aubin, Saint Helier.

Society

Jersey has a population of 101,073 with a current growth rate of +0.7% per year. Ethnic groups include Jersey 46%, British 32%, Portuguese/Madeiran 8%, Polish 3% and others. Official languages: English 95%, 0.9% French; Portuguese is spoken by 5% of society. Religious division: Protestant and Roman Catholic (no data available on the percentiles).

Government

Jersey is a parliamentary democracy under British crown dependency with capital Saint Helier. Queen Elizabeth is represented by Lieutenant Governor Sir Stephen Dalton (since 2017) and the Head of Government is Chief Minister John Le Fondre (since June 2018), subject to a unicameral Assembly of the States of Jersey with 49 seats.

Political & Business Risks

Know Your Client (KYC) regulations are in place for Jersey, as most business relationships are with non-residents, in order to combat illicit money laundering from criminal activity. Drug-related crimes are an issue in Jersey. Suspicious activity reports are related to tax activity. Jersey’s government requires beneficial ownership information be held in the corporate registry and by financial regulators, which accounts for transparency and efforts in preventing corruption.

The Corruption (Jersey) Law of 2006 provides a comprehensive framework covering corruption involving a public body, public official, and corruption transactions with agents. The UK Bribery Act enacts strict liability on corporate inability to prevent bribery where the only defence is showing adequate compliance procedures.. 

Economy

Financial services account for 96% of Jersey’s GDP. Tourism plays an important role in the industries. Incentives such as light taxes and death duties attract international financial businesses to the offshore sector of Jersey.

Financial Regulators

JFSC – Jersey Financial Services Commission

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United Arab Emirates

Geography

The UAE is a country in the Middle East, located between Oman and Saudi Arabia and borders the Gulf of Oman and the Persian Gulf.

Society

The Emirati society is marked by a +1.4% population growth, totalling 9,992,083. Ethnic division: Emirati 11.6%, South Asian 59.4% (includes Indian 38.2%, Bangladeshi 9.5%, Pakistani 9.4%, other 2.3%), Egyptian 10.2%, Filipino 6.1%, other 12.8%. Religious division: Muslim (official) 76%, Christian 9%, 15% other.

Government

The UAE is a federation of monarchies with the capital Abu Dhabi. There are 7 administratively divided emirates: Abu Dhabi, Ajman, Fujairah, Sharjah, Dubai, Ras al-Khaimah and Umm al-Quwain.

The chief executive head of UAE and ruler of Abu Dhabi is President Khalifa bin Zayid Al-Nuhayyan. The Prime Minister and Vice President of UAE is Muhammad Bin Rashid Al-Maktum. The UAE has a mixed legal system of Islamic (sharia) law and civil law.

Political & Business Risks

The UAE enjoys ease of doing business due to its political and social stability, strategic location and favourable business regulations. The real estate market is a hub for money laundering with properties being directly owned by sanctioned individuals. The country is also a major drug illicit transshipment point to and from Southwest Asia. There are 45 free zones in the UAE favouring no income, import or export taxes.

The key anti-corruption legislation in the UAE is the Federal Penal Code of the UAE, but anti-corruption prohibitions are part of the Dubai Penal Code, the Armed Forces Law, and Armed Forces Tenders Regulations Law. The legislative framework covers private sector bribery, officials of international organisations and officials of foreign governments held liable for corruption offences. The penalties for bribery offences under the Federal Penal Code include fines and imprisonment.  

Economy

Agriculture accounts for only 0.9% of GDP, the majority comes from the services – 49.2% and industry – 49.8%. Oil exports account for about 30% of total UAE gross domestic product. The UAE is an important energy supplier. Attempts to diversify the economy has seen investments in petrochemicals, tourism, heavy industries, telecommunications, information technologies.

Financial Regulators

DFSA – Dubai Financial Services Authority

CBUAE – Central Bank of the UAE

SCA – Securities and Commodities Authority

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Anguilla

Geography

Anguilla is a chain of islands between the Caribbean Sea and North Atlantic Ocean, east of Puerto Rico. Major ports include Blowing Point and Road Bay.

Society

Anguilla has a population of approximately 18,090 with a current growth rate of +1.82% per year. Ethnic division: African descent 85%, Hispanic 5%, mixed 3.8%, others. Religious division: Protestant 73%, Roman Catholic 6.8%, Other Christian 10.9%. Official language is English.

Government

Anguilla is a UK overseas territory with a self-governing parliamentary democracy and capital The Valley. The Queen is represented by Governor Tim Roy and Head of Government is Chief Minister Victor Banks.

Political & Business Risks

Anguilla is a major transshipment point for illicit drug trafficking from South America to the US and Europe. The offshore sector is growing steadily, alongside favourable tax regimes threatens money laundering in Anguilla. The UK Bribery Act enacts strict liability on corporate inability to prevent bribery where the only defence is showing adequate compliance procedures. Anguilla needs to amend its legislation to ensure legal persons and corporations are held liable for anti-money laundering activities.  

Economy

Agriculture accounts for 3% of GDP, services – 86.4%, and industry – 10.5%. Anguilla’s economy is characterised by luxury tourism, its offshore banking sector and remittances from the British government. The construction sector is closely tied to the tourist sector. Hurricane Irma has caused severe damages to the infrastructure of Anguilla in 2017. Economic prospects depend on climate and tourism.

Financial Regulators

AFSC – Anguilla Financial Services Commission

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Israel

Geography

Israel is based in the Middle East, bordering Egypt on the south and Lebanon on the north.

Society

Israeli society has a population of around 8,675,475 with a current growth rate of +1.9% per year. Ethnic division: Jewish 74.4%, Arab 20.9%, other 4.7%. Religious division: Jewish 74.3%, Muslim 17.8%, Christian 1.9%, Druze 1.6%, other 4.4%.

Government

Israel is a parliamentary democracy with the capital officially recognised by the US as Jerusalem. There have been disputes around the capital with many countries seeing this as a political question and adhering to Tel Aviv as capital. Chief of state is President Reuben Rivlin and Prime Minister is Benjamin Netanyahu.

Political & Business Risks

Israel has a diverse society marked with cultural and political differences between secular and ultra-Orthodox Jews. Another split between the Jewish majority and a fast growing Arab Palestinian minority causes major tensions in the country. The US decision to move the US embassy there from Tel Aviv to Jerusalem has greatly heightened tensions between Israel and Palestine and throughout the Middle East. Tensions between Israel and Iran account for security risks, as well as occasional Palestinian revolts. Economic-wise, numerous high compliance costs for business cause impediment for competition and investment.

Israel sees illicit drug import from Lebanon and Jordan. The main anti-bribery and corruption legislation enacted in Israel is the Penal Law and the Prohibition on Money Laundering Law. Criminal liability can be imposed directly on public officials, natural and legal persons corporations. The penalties for bribery include fines and imprisonment.  

Economy

Agriculture accounts for 2.4% of GDP, services – 69.5%, industry – 26.5%. Major industries in Israel involve diamonds, pharmaceuticals, machinery and software. The economy is dependant on oil imports. Investments in infrastructure and the Leviathan gas field account for projections of future economic diversification. Israel’s start-up sector is a major drive for the economy in the security and IT spheres.

Financial Regulators

ISA – Israel Securities Authority

BOI – Bank of Israel

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Turkey

Geography

Turkey is a country spreading in Southeastern Europe (west of the Bosphorus) and Southeastern Asia. The country is bordering the Black Sea, between Bulgaria and Georgia, the Aegean Sea and the Mediterranean Sea, between Greece and Syria. Other bordering countries include Georgia, Iraq, Iran, Armenia and Azerbaijan.

Society

Turkish society has a population of 82,017,514 with a current growth rate of +1.7% per year. Ethnic division: Turkish 70-75%, Kurdish 19%, other 7-12%. Religious division: Muslim 99.8% (mostly Sunni), other 0.2% (Christian and Jewish).

Government

Turkey is a presidential republic with capital Ankara. Chief of state is President Recep Tayyip Erdogan. Turkey has 81 administratively divided provinces. The state’s council of ministers is appointed by the president.

Political & Business Risks

The spillovers of the Syrian war have significantly affected Turkey with over 2 million Syrian refugees  living in Istanbul, in the southeast of the country or in camps close to the border. Jihadists and Kurdish militants are occasionally waging campaigns against the government with Turkey being the target of several attacks by the Islamic State. A failed military coup occurred in July 2016 which saw about 50,000 people arrested and more than 100,000 were removed from their jobs including 4,000 judges and prosecutors causing internal security and social instabilities. Turkey is a key transshipment point for illicit drugs from Southeast Asia.

Foreign investments are impeded by the lack of rights protection from the legal system and low savings rate. The key anti-bribery and corruption legislation in Turkish legislation is the Turkish Criminal Code, Law on Declaration of Property, Anti-Bribery and Anti-Corruption, Law on Public Officers, Regulation on the Ethics Board for Public Officials and the Civil Servants Ethical Principles and Application Procedures and Principle. According to the Criminal Code, legal entities are not liable for sanctions except for being subject to cancellation of an operating license granted by a public authority and confiscation.  

Economy

Agriculture accounts for 6.8% of the GDP, services – 60.7%, industry – 32.3%. The economy entered a lower phase in 2016 due to weaker business confidence, a failed coup attempt and a series of terrorist attacks which weakened the tourist industry and curbed investment. Government incentives to regulate the economy have left around 40% unregistered workforce. Exports of textiles employ 30% of the workforce. Turkey is an automobile production hub with major investments by leading companies. Future projects for gas exports to the Caspian countries are envisioned by the Trans-Anatolian pipeline.

Financial Regulators

CMBT – Capital Markets Board of Turkey

BRSA – Banking Regulation and Supervision Agency

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China

Geography

China is a country based in Eastern Asia, bordering the East China Sea, Korea Bay, Yellow Sea, and South China Sea. China is bordering  Afghanistan, Bhutan, Burma, India, Kazakhstan, North Korea, Kyrgyzstan, Laos, Mongolia, Nepal, Pakistan, Russia, Tajikistan, and Vietnam.

Society

Chinese society has a population of around 1,394,015,977 with a current growth rate of +0.7% per year. The Chinese government officially recognises 56 ethnic groups. Ethnic division: Han Chinese 91.6%, Zhuang 1.3%, other 7.1% (includes Hui, Manchu, Uighur, Miao, Yi, Tujia, Tibetan, Mongol, Dong, Buyei, Yao, Bai, Korean, Hani, Li, Kazakh, Dai, and other nationalities). China is officially an atheist state. Religious division: Buddhist 18.2%, Christian 5.1%, Muslim 1.8%, folk religion 21.9%, unaffiliated 52.2%.

Government

China is a communist party-led state with capital Beijing. The chief of state is President Xi Jinping. The country has 23 provinces and 5 autonomous regions – Guangxi, Inner Mongolia, Ningxia, Xinjiang Uygur, (Tibet).

Political & Business Risks

China is a source, transit and destination for sex trafficking and forced labour. The country is a major transshipment point for drugs. The country is part of many transnational disputes with India, Taiwan, Vietnam, Japan, Hong Kong and the autonomous territories. The government has implemented a sweeping crackdown of Uighurs suspected of involvement in terrorist plots. Discontent among Han residents of Xingjian is also a concern. Beijing’s investigation into official corruption has broadened over time. The state has introduced cuts for corporate investment in an attempt to draw more foreign businesses and has offered financial support for small and micro enterprises.

In China, current key anti-bribery and corruption legislation are PRC Criminal Law (刑法), the PRC Anti-unfair Competition Law (“AUCL”,反不正当竞争法). The Criminal law extends to accepting bribes by a close relative of a State Functionary or any other person who has a close relationship with the said State Functionary. Corporate entities could be subject to criminal liabilities of fixed-term imprisonment, criminal detention, and confiscation of properties for offering a bribe. However, the Criminal does not elaborate on criminal liability for corporate entities for acceptance of bribe payment.  

Economy

Agriculture accounts for 7.9% of GDP, services – 51.6%, industry – 40.5%. China is the world leader of agricultural and industrial output. China is leading in online retail market services. Chinese major industries include mining and ore processing, metals, machinery, consumer products, transportation equipment, food processing and telecommunications equipment. Around 66% of state investments flow into production in a desire to move the economy to a consumption-based one. China’s Belt and Road Initiative will boost trade and investment ties with participating countries.

Financial Regulators

CBRC – China Banking Regulatory Commission

CSRC – China Security Regulatory Commission

CIRC– China Banking and Insurance Regulatory Commission

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Switzerland

Geography

Switzerland is a country in Central Europe, bordering France, Italy, Germany and Austria.

Society

Switzerland has a population of 8,403,994 with  current growth rate of +1.1% per year.  Ethnic division: Swiss 69.5%, German 4.2%, Italian 3.2%, Portuguese 2.6%, French 2%, Kosovar 1.1%, other 17.3%. Religious division: Roman Catholic 35.9%, Protestant 23.8%, other Christian 5.9%, Muslim 5.4%, none 26%.

Government

Switzerland is a federal republic with capital Bern. The chief of state is President Simonetta Sommaruga and Vice President Guy Parmelin. The Federal Council, comprised of 7 federal councillors, rotate on a 1-year term of federal presidency. The country is divided in 26 administrative cantons.

Political & Business Risks

There is growing pressure for liberalisation of the over-regulated and partly cartelised domestic economy. At the same time, Switzerland is a major international financial centre vulnerable to money laundering due to remaining secrecy rules and nonresidents permissions for use of offshore entities and intermediaries. Anti-corruption and bribery offences are part of the Swiss Criminal Code for both public officials and legal persons and corporations. Active and passive bribery are penalised by up to 3 years imprisonment and monetary penalty. Private sector bribery is considered a public offence, i.e. it will be prosecuted regardless of whether a complaint has been filed.  

Economy

Agriculture accounts for 0.7% of GDP, services – 73.7%, industry – 25.6%. Swiss economy is traditionally specialises in machinery, chemicals, watches, textiles, precision engineering, tourism, banking, insurance and pharmaceuticals. Switzerland’s GDP per capita is one of the highest in the western world. The financial sector typically accounts for almost half of all growth.

Financial Regulators

FINMA – Swiss Financial Market Supervisory Authority;

SNB – Swiss National Bank

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France

Geography

France is a country in Western Europe, located between the Bay of Biscay and English Channel, bordering Andorra, Belgium, Germany, Italy, Luxembourg, Monaco, Spain and Switzerland.

Society

France has a population of 67,848,156 with a current growth rate of +0.7% per year. There is no official ethnic division census. Religious division: Christian  Roman Catholic 63-66%, Muslim 7-9%, Buddhist 0.5-0.75%, Jewish 0.5-0.75%, other 0.5-1.0%, none 23-28%.

Government

France is a semi-presidential republic with Paris being the capital city. The chief of state is President Emmanuel Macron. France is divided in 13 mainland regions and 5 overseas territories – French Guiana, Guadeloupe, Martinique, Mayotte, and Reunion. Dependent areas include Clipperton Island, French Polynesia, French Southern and Antarctic Lands, New Caledonia, Saint Barthelemy, Saint Martin, Saint Pierre and Miquelon, Wallis and Futuna.

Political & Business Risks

Payroll taxes are among the highest in the world are being scaled back if companies agree to hiring and investment. Corporate tax rates will also be cut to 25% in the coming 2 years. France has recently seen a significant flow of immigrants due to the Syrian war, causing surge to right-wing populist parties. Terrorist attacks and large-scale yellow vest protests in recent years have seen a drop in tourism.

The key anti-corruption legislation is the French Penal Code, French Criminal Code, covering provisions relating to the prohibition of bribery of French public officials, foreign public officials, and provisions relating to the prohibition of bribery of any person exercising a social or professional activity. The French Anti-corruption Agency oversees the detection and prevention of corruption and trade in influence. Corporate entities are generally liable for offences committed by people acting on their behalf.  

Economy

Agriculture accounts for 1.7% of GDP, services – 78.8% , industry – 19.5%. Main industries employing the labour force include machinery, chemicals, automobile, aircraft, metallurgy, electronics, textiles, food processing, tourism.

Financial Regulators

AMF – Autorité des Marchés Financiers

BDF – Banque de France

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Germany

Geography

Germany is located in Central Europe, bordering the Baltic Sea, the North Sea, Austria, Belgium, Czech Republic, Denmark, France, Luxembourg, Netherlands, Poland, and Switzerland.

Society

Germany has a population of 80,159,662 people with a current growth rate of +0.4% per year. Ethnic division: German 87.2%, Turkish 1.8%, Polish 1%, Syrian 1%, other 9%. Religious division: Roman Catholic 27.7%, Protestant 25.5%, Muslim 5.1%, Orthodox 1.9%, other Christian 1.1%, none 37.8%.

Government

Germany is a federal parliamentary republic with capital Berlin. The chief of state is President Frank-Walter Steinmeier. Head of Government is Chancellor Angela Merkel. Germany is administratively divided into 16 states – Baden-Wuerttemberg, Bavaria, Berlin, Brandenburg, Bremen, Hamburg, Hessen, Mecklenburg-Vorpommern, Lower Saxony, North Rhine-Westphalia, Rhineland-Palatinat, Saarland, Saxony, Saxony-Anhalt, Schleswig-Holstein, Thueringen.

Political & Business Risks

Germany has recently seen the biggest flow of immigrants from the Syrian war compared to any EU country, causing surge to right-wing populist parties. Entry barriers in a variety of service activities hold back growth of productivity. An overhaul of the income tax system has reduced the overall tax burden but the complexity of corporate taxes hinders private investment.

The German Criminal Code contains provisions on both active and passive bribery for public officials, legal persons and members of the legislative assembly. Recently, a set of provisions were enacted forbidding the offer, promise or granting of a benefit to a healthcare professional for the prescription of drugs or medical devices, their purchase for immediate application, or referrals for treatment or examination. Criminal liability of corporations is enacted through the legal persons acting on their behalf.  

Economy

Agriculture accounts for 0.7%, services – 68.6%, industry – 30.7%. Germany is the biggest European economy and a major exporter of machinery, vehicles, chemicals and household equipment. Manufacturing is dominated by large companies producing motor vehicles, precision engineering, brewing, chemicals, pharmaceuticals and heavy metals.

Financial Regulators

BaFin – Federal Financial Supervisory Authority

Deutsche Bundesbank – Bank of the Federation of Germany

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Colombia

Geography

Colombia is located in Northern South America, bordering the Caribbean Sea, Panama, Ecuador, Peru, Brazil and Venezuela.

Society

Colombia has a population of around 49,084,841 with a growth rate of +0.8% per year. Ethnic division: mestizo and white 87.6%, Afro-Colombian (includes mulatto, Raizal, and Palenquero) 6.8%, Amerindian 4.3%, unspecified 1.4%. Religious division: Roman Catholic 79%, Protestant 14% (includes Pentecostal 6%, mainline Protestant 2%, other 6%), other 2%, unspecified 5%..

Government

Colombia is a presidential republic with capital Bogota. Chief of state and head of government is President Ivan Duque Marquez. Colombia is divided by 32 departments and 1 capital district.

Political & Business Risks

International political tensions include the National Liberation Army, a Marxist-Leninist group which seeks to remove the Colombian government from power. The Revolutionary Armed Forces of Colombia (FARC) have signed a peace agreement with the government and have entered the political scene. Colombia is home to over half a million Venezuelan refugees. Colombia is the world’s largest cultivator of coca. A partial privatisation of the state oil company is being implemented in order to revive the upstream oil industry.

Corruption remains a problem in many sectors. Estimates suggest that only about 5% of the population pay taxes. Payroll tax cuts help to reduce the degree of informality in the labour market. The Colombian Criminal Act, the Anti-Corruption Act, the Unified Disciplinary Code, Anti-bribery Act and a few other regulations cover different aspects of corruption. Active and passive bribery is an offence for public officials, natural and legal persons representing corporations. A compliance program could be a defence to a legal entity in bribery charges, providing exemption from liability for the actions of employees. Penalties include imprisonment up to 15 years and monetary fines.  

Economy

Agriculture accounts for 7.2% of GDP, services – 62.1%, industry – 30.8%. Colombia is the world’s fifth largest exporter of coal. With oil exports representing nearly half of GDP, Colombia’s economic prospects have been closely tied to conditions in the energy sector. The degree of inequality is still relatively high, despite the overall poverty decline.

Financial Regulators

SFC – Superintendencia Financiera de Colombia

DIAN – National Directorate of Taxes and Customs

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Venezuela

Geography

Venezuela is located in Northern South America, bordering the Caribbean Sea and the North Atlantic Ocean, bordering Brazil, Colombia and Guyana.

Society

Venezuela has a population of 28,644,603 people with a current growth rate of +1.3%.  Ethnic division (no statistics): Spanish, Italian, Portuguese, Arab, German, African, indigenous. Religious division: nominally Roman Catholic 96%, Protestant 2%, other 2%.

Government

Venezuela is a federal presidential republic with capital Caracas. The chief of state is President Nicolas Maduro Moros. Venezuela is divided by 23 states, 1 capital district and 1 federal dependency – Amazonas, Anzoategui, Apure, Aragua, Barinas, Bolivar, Carabobo, Cojedes, Delta Amacuro, Dependencias Federales, Distrito Capital, Falcon, Guarico, Lara, Merida, Miranda, Monagas, Nueva Esparta, Portuguesa, Sucre, Tachira, Trujillo, Vargas, Yaracuy and Zulia.

Political & Business Risks

The National Liberation Army operates in Venezuela maintaining drug traffic production and distribution. Sex trafficking and forced labour are prevalent issues in Venezuela. Drug-related money laundering has been the main reason for international sanctions.

Key anti-corruption legislation includes The Anti-Corruption Law amd The Antitrust Law of 2014, The Organic Law Against Organised Crime and Terrorism Financing enacted in 2012, The Public Function Statute Law and The Code of Ethics of the Public Servant. Subject to liability of active and passive corruption are public officials, natural and legal persons and corporations. If a company representative conducts an act of bribery, the company is subject to liquidation and prohibition of participation in specific activities, a fine, confiscation of assets, and potential license revoking.  

Economy

Venezuela is heavily dependent on oil revenues, accounting for almost all export earnings and around half of public revenue. Continuous sanctions, limited access to foreign currencies and a strict government regime have seen mass poverty and import of basic goods – food and consumer.

Financial Regulators

SNV – Superintendencia Nacional de Valores

BCV – Banco Central de Venezuela

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