In the summer I did an environmental scanning blog on the Nepal earthquake and El Nino. I now want to look at two other events that could affect businesses in the UK. The first of these is the immigration crisis and the second is the forest fires of Indonesia.
The immigration crisis across Europe
As an island on the edge of Europe, not in the Schengen agreement, we may feel we are least affected by the current immigration crisis. However all that is doing is holding off the inevitable consequences caused by mass migration. Whatever our political feelings on the subject, most of these people are in a desperate situation and are keen to try and get a better life for themselves. They are naturally attracted to the more prosperous and vibrant countries of Northern Europe.
As a business you need to remove yourselves from the political and emotional aspects of this crisis and examine it with a strategic overview, looking at how it will affect you, your customers and your suppliers. This could be something as simple as disruption to your road imports via the channel. Alternatively you may be in a business that requires the extra labour that the immigrants’ will bring. Do you trade with other European countries, has this been affected because they are having to focus on their own problems. Having just come back from visiting family in Austria I have seen a very distinctive shift in their political outlook were the far right influence is growing rapidly. This is causing a drawbridge syndrome where they are closing into smaller geographical units in order to keep others out. This in itself will affect the way they trade with us.
In the longer term Europe may well bring in more border controls which will affect the cost of our trade across the European continent. This all goes to evidence why we should pay careful attention to the political and economic stories on our doorstep
The Indonesian Forest fires
In the summer, when I talked about El Nino, I stated that this would produce all sorts of variations in world weather. As an example Indonesia has had a particularly dry summer. On an annual basis this country has been burning forest and agricultural land in order to clear the way for palm oil production. This usually produces a haze problem but this year it is far worse than the normal. This problem began in June and is still causing tremendous difficulties in Malaysia, Borneo and Singapore. Schools have had to be shut, there have been fatalities, populations evacuated and a general adverse effect on those countries economic output. In November Indonesia’s president, Joko Widodo, cancelled a visit to the United Nations in order to stay in the area where the problem was at its worst.
This problem has not been hugely reported in the UK Media, some say because we have economic interests and don’t want to rock the boat. However it is a good example of where UK businesses should be scanning the world events to see if it will have an effect on their trading. Do you have any imports from this area or is your business geared towards tourism in Asia? Are you tied up in the palm oil industry or do you trade with Singapore? In Indonesia, and the countries that border them, this is a major event that has been going on for six months and has caused a great deal of disruption in this area.
Remember to keep an eye on the news and always think what will that do to my business.