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Global Supply Chain Conditions Continue to Deteriorate

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Global Supply Chain Conditions Continue to Deteriorate

Operational risks increasing, according to new survey.

Global supply chain risk increased in the fourth quarter of 2015, resuming the worsening trend in global operational risk according to the latest Chartered Institute of Procurement & Supply (CIPS) Risk Index. The index's high score reflects the general unease about the state of the global economy with its increase in operational risk and the Chinese slowdown highlighting emerging market vulnerabilities.

Key highlights from the index include:
•    Supply chain risk in Asia Pacific continued to rise due to worsening economic conditions in New Zealand, Australia and China.
•    Sub-Saharan Africa's supply chain risks fell slightly, though underlying risk trend continues to deteriorate.
•    Though Iran's re-entry into global supply chains encourages optimism, supply chain risk in the Middle East and North Africa (MENA) remains in the high risk category.

The business uncertainty – a feature of the global economy since the end of the recession – continues to stifle consumer confidence, which is necessary for a robust global recovery."The index score worsened slightly in the last quarter of 2015 to 79.3 from 79.1 in the third quarter of 2015. While some regions, including the EU, have improved since mid-2015, emerging markets now demonstrate more vulnerability.

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