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PA Resources conducts business activities in countries where a certain level of risk exists in respect of political instability. The concept, political instability, comprises financial vulnerability and vulnerability to unrest. Business activities are also, to a certain extent, conducted in countries where corruption can occur. Bribes and other forms of corruption lead to significant problems for those companies that become involved.
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In so far as it is possible, the Group endeavours to avoid unstable countries with unrest. When re-quired, the Group utilises the OEC D’s tools for corporate risk manage-ment in countries with weak governments. Read more at www.sweden.gov.se. The Group has deter-mined to support the Extractive Industry Transparency Initiative (EITI) that aims to increase the transpa-rency of payment flows and thus counter corrup-tion. The Republic of Congo is a candidate country to the initiative and Equatorial Guinea has announced its intent to become a candidate.
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According to the Economist Intelligence Unit’s Index 2009/2010* of political instability, none of the countries in which PA Resources operates are included among the 70 highest risk countries in the world. However, it is extremely difficult to predict where unrest will appear. At the end of 2010, the Jasmine revolution commenced in Tunisia. The Group has therefore raised assessments of the likelihood of the risk imp acting the Group in 2011.
*Source: Economist Intelligence Unit, www.viewswire.eiu.com
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