Man-made threats including market crashes, cybercrime and interstate conflicts are a bigger threat to economic output than natural disasters, according to a new survey from insurer Lloyd's.
These risks have an estimated annual impact of $320 billion of global gross domestic product (GDP) for the 279 cities in the survey. The insurance giant said they are a much bigger economic threat than hurricanes, floods, earthquakes and volcanoes.
The Lloyd's "City Risk Index," published Wednesday and created in collaboration with Cambridge University, measured the impact of 22 threats (both man-made and natural). The index showed that 279 major cities across the world — with a combined gross domestic product (GDP) of $35.4 trillion — risk losing on average $546.5 billion in economic output annually from all 22 threats. This comprises $320.1 billion to man-made risks and $226.4 billion to natural catastrophes.
The top threat is a market crash, which puts $103.33 billion of total GDP at risk, while the second biggest risk is interstate conflict (putting $80 billion of total GDP at risk) followed by tropical windstorms which are a $62.59 billion threat to total GDP. The rest of the risks in the top 10 included human pandemic, civil conflict, sovereign default, flood, earthquakes and commodity price shocks.