Risk managers of multinational corporations would do well to follow closely the escalating protests over Danish cartoons satirizing the Prophet Muhammad in Europe and the Middle East, according to Aon Trade Credit Managing Director Bryan Squibb.
President Bush has called for an end to the escalating violence. On Monday, Afghan troops opened fire on some 2,000 protesters, while Iranian police used tear gas to disperse hundreds of protesters hurling stones and firebombs at the Danish Embassy in Tehran. A teenager in Somalia was killed as police, dispersing protesters, triggered a stampede. In Syria, both the Danish and Norwegian missions were burned.
“The spread of violence emanating from the original publications in Danish press has clearly demonstrated how the ‘domino’ effect can impact trade relations and equity and investment decisions,” Squibb said. “Multinational corporations have to create business risk scenarios, and monitor supply, assembly and distribution channels.”
Squibb points out that while religious fundamentalism in and of itself does not necessarily have any detrimental impact on global trade or equity investments, “extreme reactions to events often impact greatly on trade. The peripheral nature of such events can touch countries worldwide,” he said.
The European Union has reportedly reminded 18 Muslim countries that they are obliged under the Vienna Convention on Diplomatic Relations to protect foreign embassies, Austria has expressed concern for the safety of diplomatic missions to the Organization of the Islamic Conference and the prime ministers of Spain and Turkey have appealed for calm.
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