Global Insight is the world's leading provider of economic, industry and trade forecasts, historical data, and consulting services. Global Insight, Inc. (GII) was formed in March 2001 to be the leading organization that provides business leaders, investors and government officials with economic information, analysis and solutions. In May 2001, GII integrated two highly respected economic information companies, DRI (formerly Data Resources, Inc.) and WEFA (formerly Wharton Econometric Forecasting Associates). The inclusion of Decision Economics, Primark Poland, and DAFSA rounds out the capabilities of GII. Global Insight's professional expertise spans over 400 industries, 180 countries, and 318 U.S. metropolitan statistical areas.

Past, present and future
Global Insight’s three main product lines include analytical subscription services, data, and consulting services. They provide valued insight on the global business environment to strategic planners, business analysts, risk managers, purchasing managers, corporate economists and policy makers worldwide. Some 2,000 private and public sector organisations rely on Global Insight to help them understand the past, clarify the present, and anticipate the future in ways that allow them to make better decisions.

Global Insight also provides a broad range of consulting capabilities covering market analysis, business planning, investment strategy, risk assessment, infrastructure analysis, policy evaluation, and economic development and impact. The combination of expertise, modelling assets, data repository and analytical software tools deliver actionable solutions that address specific client needs.

Over 500 employees and 30 offices covering North and South America, Europe, Africa, the Middle East and Asia support Global Insight’s clients, in industry, finance and government around the world. GII’s Global Insight also possesses one of the largest collections of historical economic information available, covering over 180 countries and all major industries, and has the analytical software to manipulate, analyse, display and report this information.

Analyses and forecasts are based on a unique set of internally consistent econometric models, coordinating and drawing upon the country and industry expertise of 220 on-staff economists, analysts and researchers. Millions of time-series of international economic data are updated continuously.

Understanding risk
To help companies investing in new areas of the world, Global Insight launched the Global Risk Service (GRS) in 1995. The GRS allows our clients to assess the extent to which the benefits of faster growing markets and lower cost resources, compared to traditional areas of operation, are outweighed by increased uncertainties.

The Global Risk Service is also highly business relevant. The sources of risk facing companies vary considerably according to the type of business they are engaged in and also how their projects and operations are structured. To reflect this no less than 33 different sources of risk that have a potentially direct effect on business results are evaluated.

Companies receive an evaluation of risk that is both quantitative and forward-looking, which can be employed directly in the evaluation of future plans.

The 33 Immediate Risk Events cover:

The same 33 risk events are analyzed in each of the countries covered, which currently number 117 and make up around 98% of world GDP. The percentage probabilities for each event do not come out of a "black box" but emerge from a lengthy iterative process of analysis and discussion that combines analysis of historical trends and future prospects in individual countries with extensive "cross-country" comparison and ranking. All results are subject to a system of "peer review" before publication.

The Global Insight team anticipated all the following developments well in advance: Thai devaluation and the crisis in Asia's tigers, Japan's long-term stagnation, devaluation in Brazil in 1999 and the latest Argentine crisis, currency crises in South Africa, Russia and Turkey, coups in Indonesia and Ecuador, etc.

Country Risk Premium
Global Insight has on many occasions helped clients to carry out detailed financial evaluation of potential capital projects. By identifying which risk events are relevant to a particular project and how they would affect cash flow if they occurred, the event probabilities provided by GRS can be used to estimate potential losses in the country where the project would be located. From these parameters such as "cash flow at risk" and "capital at risk" can be estimated and from them forecasts can be derived for the project's rate of return and value that are adjusted for country risk. Since the same risk events are analyzed in all 117 countries covered by GRS, it is possible to make comparisons of the risk levels for different locations, either for new capital projects or for ongoing business operations, special contracts and also acquisitions.

Rob Marshall
Global Risk Service Product Management
www.globalinsight.com
Tel: +44 20 8544 7931

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