Five key rising risks

The Allianz Risk Barometer 2024 has identified the top five risks facing the government and public services sector – including healthcare – emphasising the critical challenges that require urgent attention in Africa and the Middle East.

The top risks are cyber incidents, shortage of skilled workforce, changes in legislation and regulation, macroeconomic developments, and natural catastrophes. The report, based on insights from over 3,000 risk management professionals and business leaders, highlights the growing importance of addressing these risks to ensure business continuity and safeguard against potential disruptions.

Cyber incidents (37% of responses)

Cyber incidents have surged to the top of risks for government and public services, up from the second position in 2023. The increasing digitalisation of public services and healthcare systems makes them prime targets for cyber-attacks. To mitigate this risk, governments must invest in robust cybersecurity frameworks, including advanced threat detection, regular security audits, and comprehensive incident response plans. Training public sector employees on cybersecurity awareness and best practices is also crucial to enhancing organisational resilience against cyberthreats.

Shortage of skilled workforce (29% of responses)

The shortage of a skilled workforce poses a significant challenge for the public sector. The growing demand for qualified professionals in healthcare, education, and public administration is outstripping supply. To address this issue, governments should implement strategies to attract and retain talent, such as offering competitive compensation, investing in education and training programmes, and promoting career development opportunities. Partnerships with educational institutions to align curricula with industry needs can also help bridge the skills gap.

Changes in legislation and regulation (23% of responses)

Changes in legislation and regulation remain a prominent concern for the public sector. The dynamic regulatory environment requires continuous adaptation and compliance.

Governments and public service providers should establish dedicated compliance teams to monitor and respond to legislative changes. Engaging with policymakers and stakeholders to influence regulatory developments and ensure alignment with organisational goals is also essential. Implementing robust compliance management systems can help navigate regulatory complexities in a timely and effective manner.

Macroeconomic developments (23% of responses)

Macroeconomic developments, such as economic volatility and fiscal constraints, pose significant risks to public services. These developments can impact budgets, resource allocation, and service delivery. Governments should adopt prudent fiscal policies, diversify revenue streams, and enhance financial planning to mitigate the effects of economic fluctuations. Engaging in public-private partnerships and leveraging international financial support can also provide additional stability and resources for public services.

Natural catastrophes (20% of responses)

Natural catastrophes, including floods, droughts, and extreme weather events, present substantial risks to the public sector. These events can disrupt essential services, damage infrastructure, and strain emergency response systems. To mitigate the impact of natural catastrophes, governments should invest in resilient infrastructure, develop comprehensive disaster preparedness plans, and utilise early warning systems. Collaboration with international agencies and neighbouring countries can also improve disaster response and recovery efforts.

By proactively addressing these risks, the government and public services sector in Africa and the Middle East can improve the provision of essential services and enhance the overall resilience and effectiveness of public administration.

You can view the Allianz Risk Barometer methodology and full global and country risk rankings here.