Risky Business: What the industry can expect in 2018
That the corporate jet sector faces risks in 2018 goes without question – disparate global risks that, however, can be anticipated and managed. Nick Allan, CEO of Control Risks, took delegates of Corporate Jet Investor’s London 2018 conference through the risks the industry can expect to be impacted by in 2018.
Allan starts the list with North Korea and its imminent ability to deploy nuclear-tipped ICBMs capable of reaching the whole of Europe, including the UK, as well as the US. Is Kim Jong Un crazy enough to press the button he claims to have on his desk? Almost certainly not, for that would lead to a retaliatory attack that would destroy his regime — an unthinkable outcome from a man determined to preserve his dynasty but one who needs to show off Korea’s rocketry and nuclear capacities to his people.
Second in line, is the likelihood of an increase in the frequency of large-scale and specifically targeted cyberattacks on infrastructure. Around the world some 20 countries have sophisticated cyberattack capabilities but with defence capacity.
Number three, and arguably the one needing the most careful management is US protectionism, driven by a President Trump who consistently declares that Trade agreements now in place do not act in his country’s best interests. However, if the Democrats hope to win back support from voters in Middle America in 2020, they would almost certainly adopt more protectionist policies.
Less certain is conflict in the Middle East; already engaged in a proxy war between Iran and Saudi Arabia in Yemen. Where that might go is anyone’s guess, but if there’s one sure bet, Allan suggests it’s that conflict will escalate in 2018.
World leaders? A risk we face is the further emergence of personalised leadership – the sort chosen by Kim, Putin, Xi and Trump. The greater the extent of personality cults, the less likely we are to see of sensible policies.
If there is one challenge that particularly threatens the aviation sector, it’s terrorism, domestic and international. Terror attacks on airports or passenger aircraft give the terrorists all the publicity they crave. Ironically, this might lead to greater use of private corporate jets by individuals or companies concerned about their safety. Apple’s CEO Tim Cook is required to use a private jet for all travel due to safety concerns.
Underlying these specifics are generalised political perceptions and their possible consequences.
Allan argues that 9/11 was not the defining crisis of this century but instead the global financial crisis. Who won from the crisis? Asia. Who lost? The middle classes and workers in developed economies, and developing economies. Popular views of capitalism have changed, democracy is under attack in the world’s democracies and we have yet to feel the public’s response to robotics, artificial intelligence and other technologies that will remove conventional job opportunities.
The risks and challenges we face were clearly enunciated by Allan. Nevertheless conference delegates were overwhelmingly optimistic – 76% feeling optimistic for the future, more than three times as many as the undecideds and the pessimists at the conference.
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