Risk Report: Q4 2025 Update

The thirtieth update of the the analyst Country Risk Index (GCRI) Q4 2025 ranked Ireland at the top, followed by Switzerland and Singapore. 43 countries were identified in the low-risk zone, 52 countries under medium risk, 53 countries under high risk, and five countries in the very high-risk zone in GCRI Q4 2025.

Global Risk Report is based on the analyst Country Risk Index (GCRI) which is a unique country risk-rating model that determines the existing and future level of country risk by assessing various qualitative and quantitative factors. The index is formulated to help firms prepare their global business strategies on the basis of historical developments in an economy and also their future expectations.

The Country Risk Index incorporates the latest available macroeconomics, political, social, technological, environmental and legal data from a range of recognized national and international statistical sources, and incorporates proprietary data from the analyst Economics Research. The model also features expert analytical judgment from in-house economists and takes into account their insights and opinions. By applying a robust approach to assessing risk, The analyst analysts ensure that strategists have an effective tool to assess current trends and risks facing the economies across the globe.

Report Scope

• Global risk: In the GCRI Q4 2025 update, the global average risk score fell to 52.1 (out of 100) from 53.2 in Q3, reflecting a short-lived easing as trade-policy signals steadied and firms largely adjusted to updated tariff structures. This improvement looks fragile: early‑2026 has brought renewed uncertainty from stop‑start tariff actions and intensifying geopolitical risks, raising the likelihood of energy and logistics disruptions (notably around the Red Sea and Strait of Hormuz) and spillovers into inflation, financing conditions and business confidence. Even so, late‑2025 trade held up, supported by earlier front‑loading and volume-led growth rather than price effects, pointing to still-resilient underlying demand.
• Asia-Pacific: Asia-Pacific: APAC’s risk score fell to 50.6 in Q4 2025 from 51.5 in Q3 2025, as trade conditions improved, led by the US-China decision in November 2025 to pause new restrictions for one year, easing tariff and supply-chain uncertainty. Progress also reflected ongoing supply-chain diversification and India’s expanding trade links-India-EFTA took effect on October 1, 2025, India-UK talks advanced, and India-Australia ECTA implementation continued, while India-Canada engagement remained uneven.
• Americas: In GCRI Q4 2025, the Americas’ risk score edged down to 54.4 (out of 100) from 54.8 in Q3 as trade conditions stabilised late in the year following earlier tariff hikes and corporate supply‑chain adjustments. However, the outlook has become more fragile: heightened US spending and operational involvement related to the Iran conflict is increasing fiscal and political pressure and could feed into energy-price volatility, inflation risks, and shifting sanctions/enforcement. Policy predictability is also weakening. After the US Supreme Court struck down Trump’s reciprocal tariffs in February 2026, the rapid rollout of temporary duties and other stop‑start announcements has left firms unclear on the direction of trade policy, compliance rules, and future market access, raising the risk of renewed disruption in coming quarters.
• Europe: Europe’s regional risk score fell to 38.6 in Q4 2025 from 39.5 in Q3, reflecting steadier growth, moderating inflation and a resilient labour market, supported by easing monetary policy and improved liquidity. However, the outlook remains highly contingent on geopolitics: the Russia‑Ukraine war continues to pose risks through energy price volatility, sanctions and defence-related fiscal pressures. More recently, rising Iran-related tensions and shipping security risks-especially around the Strait of Hormuz-raise the tail risk of supply disruptions (including LNG flows from Qatar) and higher freight/insurance costs, which could quickly tighten energy markets and weaken confidence across European industry and consumers.
• Middle East and Africa (MEA): MEA’s risk score improved in Q4 2025, easing to 61.9 from 63.5 in Q3, supported by resilient non‑oil activity and ongoing diversification in key Gulf economies. However, the near-term outlook is more challenging as the Gaza war and heightened Iran-related tensions keep escalation risks elevated, increasing the likelihood of disruptions to energy markets and critical shipping routes (notably the Red Sea). These risks could lift freight and insurance costs, delay trade flows, and weigh on tourism and investment, with spillovers to regions reliant on MEA energy supplies and logistics corridors.

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