Increased internationalisation in the commercial sector and geopolitical tensions throughout the world are leading to more geostrategic risks. Based on the many years of experience in analysing and highlighting geopolitical developments for the Dutch government, the Clingendael Institute is now making the same capacity available to companies and investors. The institute currently works with a number of companies in the financial, maritime and logistical sectors, as well as for consulting firms.
Marcel Baartman, Senior Economist at the Clingendael Institute, says, “There is substantial demand for an independent picture of potential geostrategic risks. There are lots of questions relating to China at the moment, for instance, such as queries about the geopolitical situation in the world’s most important maritime trading route, the South China Sea. Or closer to home, what will the consequences of a hard or soft Brexit be for your company? Or what will the consequences be of TTIP going through (or not)? Many companies focus their risk management on the controllable, internal risks. External risks receive less attention, structurally - often because they are something that is outside the company’s sphere of influence. But even if you are not able to exert any influence over the risk of new protectionist measures being introduced in America, you can genuinely limit the impact they will have on your company.”
Interactions between geopolitics and macroeconomics
The Institute’s analyses link geopolitical and macroeconomic developments together. Clingendael’s experts look at more than just the direct effects of geostrategic factors. It is precisely the interaction between the geopolitical and macroeconomic factors that matters. Baartman says, “We identify relevant and concrete risks at the macro level that companies and investors can use for more effective risk management and strategy formulation. The emphasis is on trend analyses, specific scenarios and stress tests for macro exposures. We offer presentations, research reports and workshops for this. For instance, we organise workshops about geopolitics for investors and we offer workshops for companies about how to deal with geopolitical risks.”