Alliant Ranks Bermuda Top in the World

Just days after Aon elevated Bermuda’s political risk rating, Alliant Political and Economic Risk Ratings says the island is the safest and most stable bet in the world for overseas investors.

The Alliant Political and Economic Risk Ratings series — carried on the Bloomberg on-line business and financial news service — places Bermuda at the very top of its index of some 176 countries.

Based in Chicago and New York City, Alliant Emerging Markets is a leading provider of credit and political risk analysis and insurance solutions.

Alliant Emerging Market’s risk ratings and indices cover eight types of political and economic risks. Its data and forecasts are based on quantitative risk models developed by its team based on access  to insurance and industry loss data as well as a network of official and private sources across G-20 and emerging markets.

Alliant looks at eight risk factors including trade credit, currency, legal and regulatory risk, sovereign defaults, civil unrest, war and terrorism, creating a ranking out of 100.

The highest-ranked country is Bermuda at 90, while the lowest include Iraq, Pakistan, the West Bank and Gaza region, Zimbabwe and Afghanistan, tied at 10.

Tunisia — its bond ratings slashed to near-junk status in the wake of last week’s coup –still ranks ahead of China, Russia and India, and only slightly behind Brazil, on Alliant’s index.

Bermuda was one of 19 countries downgraded in Aon’s 2011 Political Risk Map, its benchmark annual review of political and economic risks.

Aon lowered Bermuda’s rating from a low-risk jurisdiction to medium low-risk based on concerns about sovereign non-payment risk — defined in the “Dictionary of Financial & Investment Terms” as risk a foreign government will default on its loan or fail to honour other business commitments because of a change in national policy.

The move by Aon to downgrade Bermuda was criticised by Premier and Finance Minister Paula Cox as ”being without solid-foundation.” Shadow Finance Minister Bob Richards and the Bermuda Democratic Alliance’s Michael Fahy have both said Aon’s decision reflects badly on Government’s economic policies and could have long-term consequences for the island.

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