Political and economic violence: a scourge that poses risks to businesses

Colombia is experiencing a complex situation where political and social tensions are beginning to escalate their impact on business stability. This is revealed in the latest report from Allianz Commercial, which identifies political violence as the main risk facing companies operating in the country today.

With a total of 1,666 protests recorded in 2024, Colombia leads the number of demonstrations in South America and ranks 16th globally in political violence. Although the figure represents a 19.5% reduction compared to 2023, the country remains a critical point on the regional risk map, the document warns.

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One of the points that stands out is that companies are feeling the direct impact. According to the survey conducted by Allianz, 63% of Colombian companies consider civil unrest, protests, blockades, and riots, to be their greatest political threat, above the global average.

Furthermore, 48% fear acts of terrorism or sabotage, and 47% point to growing social polarization as an operational risk factor.

This climate of uncertainty not only affects business perceptions but is also beginning to translate into real consequences for the daily operations of large and medium-sized companies. Sectors such as energy, manufacturing, agribusiness, retail, and technology have reported disruptions in their supply chains, damage to facilities, prolonged lockdowns, and forced closures of headquarters and production plants.

"What were once peripheral risks are now central threats to business operations and continuity," the report states, in which Allianz also warns that the current environment requires reviewing contingency plans, updating insurance policies, and strengthening physical security and crisis communication protocols.

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It's worth noting that while this phenomenon is not unique to Colombia, the country has a higher level of exposure than the regional average. In Latin America, 59% of companies consider civil violence their greatest political risk, while the global average is 51%. Countries such as Argentina, Brazil, Mexico, and Peru have also experienced spikes in tension, particularly during electoral periods or following unpopular reforms.

“In the Colombian case, however, there are additional factors that worsen the situation. Allianz highlights that the combination of fiscal instability, a lack of clear rules of the game, and growing polarization is creating a climate that could discourage investment in strategic sectors. This is not only an operational risk, but also a reputational one, impacting long-term decisions,” they noted.

The events of 2021, with extended national strikes, port blockades, attacks on infrastructure, and closures in key cities, left a deep mark on corporate risk management areas, and despite this history, many companies have not yet fully adjusted their prevention plans for similar scenarios. "Companies must prepare to operate in environments where social and political volatility is not the exception, but rather part of the usual context," emphasizes Allianz, which put forward several recommendations, starting with evaluating specific vulnerabilities, establishing risk maps by region, reviewing insurance coverage for political violence, and establishing support networks with local authorities and communities.

“The final call is clear: business resilience in Colombia will depend, in large part, on the ability to anticipate and manage these risks with a strategic vision. Political violence, now more than ever, has ceased to be solely a state issue and has become a central challenge for the national economic environment,” they concluded.