24 February 2024


North's First

A cyber event cited ‘top business risk for 2024 in Uganda’

Cyber event is the top peril in 17 countries, including Uganda, Kenya, Mauritius, Germany, India, Japan, the UK, and the USA.
cyber event

Last Updated on: 9th February 2024, 03:54 pm


Key things to know:

  • Data breaches, attacks on critical infrastructure or physical assets and increased ransomware attacks drive cyber concerns (36% of responses).
  • Business interruption remains #2 with 31%. Natural catastrophes are the biggest riser compared to 2023 with 26% in #3
  • The top three risks in Uganda are Cyber incidents, Market developments as well as Theft, fraud and corruption
  • Risk perception differs regionally for climate change, political risks and violence, and shortage of skilled workforce

Munich I Cyber incidents such as ransomware attacks, data breaches, and IT disruptions are the biggest worry for companies globally in 2024, according to the Allianz Risk Barometer. The closely interlinked peril of Business interruption ranks second. 

Natural catastrophes (up from #6 to #3 year-on-year), Fire, explosion (up from #9 to #6), and Political risks and violence (up from #10 to #8) are the biggest risers in the latest compilation of the top global business risks, based on the insights of more than 3,000 risk management professionals.

A cyber event is the top business risk for 2024 in Uganda

Cyber incidents have emerged as the top risk in Uganda, with a staggering 48% of respondents expressing concern.

Market developments and Theft, fraud, and corruption were identified as joint second risks, with 35% of respondents highlighting their significance.

Paul Kavuma, CEO of Jubilee Allianz General Insurance Uganda, emphasized the gravity of the situation, stating, “Cyber incidents have become a pressing concern for businesses in Uganda. The increasing reliance on digital technologies and the interconnectedness of our world have made organizations vulnerable to cyber threats. It is crucial for businesses to prioritize cybersecurity measures to safeguard their operations and protect sensitive information.”

Allianz Commercial CEO Petros Papanikolaou comments on the findings: “The top risks and major risers in this year’s Allianz Risk Barometer reflect the big issues facing companies around the world right now – digitalization, climate change and an uncertain geopolitical environment.

Many of these risks are already hitting home, with extreme weather, ransomware attacks and regional conflicts expected to test the resilience of supply chains and business models further in 2024. Brokers and customers of insurance companies should be aware and adjust their insurance covers accordingly.”

Large corporates, mid-size, and smaller businesses are united by the same risk concerns – they are all mostly worried about cyber, business interruption and natural catastrophes. However, the resilience gap between large and smaller companies is widening, as risk awareness among larger organizations has grown since the pandemic with a notable drive to upgrade resilience, the report notes. Conversely, smaller businesses often lack the time and resources to identify and effectively prepare for a wider range of risk scenarios and, as a result, take longer to get the business back up and running after an unexpected incident.

Trends driving cyber activity in 2024

Cyber incidents (36% of overall responses) rank as the most important risk globally for the third year in a row – for the first time by a clear margin (5% points). It is the top peril in 17 countries, including Uganda, Kenya, Mauritius, Germany, India, Japan, the UK, and the USA.cyber event

A data breach is seen as the most concerning cyber threat for Allianz Risk Barometer respondents (59%) followed by attacks on critical infrastructure and physical assets (53%). The recent increase in ransomware attacks – 2023 saw a worrying resurgence in activity, with insurance claims activity up by more than 50% compared with 2022 – ranks third (53%).

“Cyber criminals are exploring ways to use new technologies such as generative artificial intelligence (AI) to automate and accelerate attacks, creating more effective malware and phishing. The growing number of incidents caused by poor cyber security, in mobile devices in particular, a shortage of millions of cyber security professionals, and the threat facing smaller companies because of their reliance on IT outsourcing are also expected to drive cyber activity in 2024, “explains Scott Sayce, Global Head of Cyber, Allianz Commercial.

Business interruption and natural catastrophes

Despite an easing of post-pandemic supply chain disruption in 2023, business interruption (31%) retains its position as the second biggest threat in the 2024 survey. Business interruption ranks #5 in Uganda.

This result reflects the interconnectedness in an increasingly volatile global business environment, as well as a strong reliance on supply chains for critical products or services. Improving business continuity management, identifying supply chain bottlenecks, and developing alternative suppliers continue to be key risk management priorities for companies in 2024.

Natural catastrophes (26%) are one of the biggest movers at #3, up three positions globally and features as new risk in Africa and the Middle East at #6. 2023 was a record-breaking year on several fronts. It was the hottest year since records began, while insured losses exceeded US$100bn for the fourth consecutive year, driven by the highest-ever damage bill of US$60bn from severe thunderstorms.

Notably, Morocco witnessed a significant rise in this risk, climbing from seventh to first place. Cameroon and South Africa also experienced a surge in natural catastrophe risks, ranking among the top five risks in these countries.

Regional differences and risk risers and fallers

Climate change (18%) may be a non-mover year-on-year at #7 but is among the top three business risks in countries such as Brazil, Greece, Italy, Turkey, and Mexico. The risk ranks #9 in Uganda. Physical damage to corporate assets from more frequent and severe extreme weather events is a key threat.

The utility, energy and industrial sectors are among the most exposed. In addition, net zero transition risks and liability risks are expected to increase in future as companies invest in new, largely untested low-carbon technologies to transform their business models.

Unsurprisingly, given ongoing conflicts in the Middle East and Ukraine, and tensions between China and the US, Political risks and violence (14%) are up to #8 from #10. Interestingly, this risk has moved down one place to seventh in Africa and the Middle East, while ranking as one of the top five risks in Cameroon and Ivory Coast.

2024 is also a super-election year, where as much as 50% of the world’s population could go to the polls, including in Ghana, Mauritius, Senegal, South Africa, India, Russia, the US, and the UK.

Dissatisfaction with the potential outcomes, coupled with general economic uncertainty, the high cost of living, and growing disinformation fueled by social media, means societal polarization is expected to increase, triggering more social unrest in many countries.

However, there is some hope among Allianz Risk Barometer respondents that 2024 could see the wild economic ups and downs experienced since the Covid-19 shock settle down, resulting in Macroeconomic developments (19%), falling to #5 from #3 globally and at a similar position in Uganda. Yet economic growth outlooks remain weak – just over 2% globally in 2024, according to Allianz Research.

By Lesiba Sethoga


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