1.5% - 3.0% p.a.** Sovereign Credit Risk Pricing Range RWANDA. Page 7

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1 RISK OUTLOOK CREDIT, POLITICAL AND SECURITY RISKS JUNE % - 0.7% p.a. Sovereign Credit Risk Pricing Range CHILE *** Sovereign Credit Risk Pricing Range VENEZUELA GHANA 1.5% - 3.0% p.a.** Sovereign Credit Risk Pricing Range RWANDA 2.0% - 2.5% p.a. Sovereign Credit Risk Pricing Range BANGLADESH 1.75% % p.a.* Sovereign Credit Risk Pricing Range VENEZUELA Intensifying anti-government protests and economic crisis increase pressure on Maduro, elevating the likelihood of regime change in Page 3 BANGLADESH Strategic importance of port infrastructure to the Bangladeshi economy will ensure opportunities for foreign investors. Page 5 RWANDA Incumbent President Paul Kagame is expected to secure his re-election in August 2017, ensuring policy continuity on the economy and for business. Page 7 ALSO IN THIS ISSUE Rating Roundup 2 Chile 8 Ghana 10 Pricing Outlook 11 Claims Data 12 Our Expertise 12 Introduction A number of the countries covered in this issue of Risk Outlook present substantial opportunities for foreign investors. Rwanda s construction sector, Bangladesh s port development projects and Ghana s infrastructure development plans are all expected to perform well in However, investors must also navigate a range of country-specific risks in order to take advantage of these opportunities. These include political violence, project delays, contract alterations and non-payment risks. Companies must respond to these risks and implement adequate risk management and insurance strategies. In this edition of Risk Outlook we also consider the deepening economic and political crisis in Venezuela, including the likelihood of a regime change. We also provide a detailed forward-looking assessment of developments within the security, trading and investment environments for Bangladesh, Rwanda, Chile and Ghana, all of which have been the subject of recent enquiries from JLT s client base. We also provide a rating roundup, summarising a selection of World Risk Review (WRR) ratings changes in additional countries. The relationship driven, consultative approach within the Credit, Political and Security (CPS) Risks division helps us to quantify, prioritise and minimise our clients political risk, security and trade credit exposures. N.B In addition to the sovereign credit risk pricing ranges shown above, this Risk Outlook contains pricing information on confiscation, expropriation, nationalisation and deprivation (CEND), full political violence and terrorism and sabotage political violence insurance. The various costs for contractors, investors and lenders are available for a three to five year tenor, for the countries covered in this month's Risk Outlook. * Capacity is limited in the market ** There are notable constraints in the market, and it can be challenging to obtain underwriter support for Ghana non-payment risks *** Underwriters are not currently accepting Venezuelan risk.

2 RATING ROUNDUP THIS MONTH S WORLD RISK REVIEW RATINGS CHANGES Suriname é Strikes, Riots and Civil Commotion (4) In April 2017, anti-government protests intensified in the capital, Paramaribo. Unions, business groups and political opposition joined protests, which attracted around 10,000 people on 7 April Protests stem from perceived government mismanagement of the economy which has been negatively affected by the low commodity price environment. Oil, gold and alumina account for 90% of goods exports. GDP is estimated to have contracted by 9.0% in 2016, whilst the fiscal deficit reached 7.0% of GDP, from 4.7% in Without concerted economic reform, protests are likely to continue in Slovakia ê Sovereign Credit Risk (3) Slovakia s fiscal deficit is forecasted to fall to 0.1% of GDP by 2019, down from 1.9% of GDP in Since 2009, when the deficit peaked at 7.8% of GDP, the government has successfully pursued a policy of fiscal consolidation. Similarly, the public debt-to- GDP ratio is falling, having peaked at 54.7% in 2013, before reaching 51.9% in Real GDP growth of 3.3% in 2017 will be driven by investment in the automotive industry by Jaguar Land Rover, Volkswagen and Peugeot Citroen. Taken together, these trends ease the risk that Slovakia will be unable to meet its debt obligations. Central African Republic é Terrorism (7) The withdrawal of US Special Forces from Central African Republic (CAR) in April 2017, has weakened security in the southeast of the country. Violent attacks by anti-balaka and Séléka militia, on the rise in other parts of CAR, are now spreading into the southeast. In May 2017, 115 people were killed during violence in Bangassou, a mining town in southeast CAR. Thousands of civilians fled into Democratic Republic of Congo. In May, five United Nations peacekeepers were also killed in an attack by anti-balaka fighters. 1 = Low Risk 10 = High Risk = Under Review (monitoring for increased risk) = Under Review (monitoring for decreased risk) é = Increased Risk ê = Decreased Risk 2 CREDIT, POLITICAL AND SECURITY RISKS Risk Outlook June 2017 JLT World Risk Review Ratings June 2017 War & Civil War VENEZUELA BANGLADESH RWANDA CHILE GHANA Country Economic Risk Terrorism Strikes, Riots & Civil Commotion The monthly Risk Outlook is supported by JLT s proprietary country risk rating tool, World Risk Review (WRR), which provides risk ratings across 9 insurable perils for 197 countries. The country risk ratings are generated by a proprietary, algorithmbased modelling system incorporating over 200 international indices. VENEZUELA Rating Outlook: Strikes, Riots & Civil Commotion; Country Economic Risk; Sovereign Credit Risk; Expropriation Venezuela faces around USD 9 billion in debt repayments in 2017, over half of which are interest and principal obligations relating to state oil company PdVSA. BANGLADESH Rating Outlook: Terrorism; Contractual Agreement Repudiation Given that exported apparel accounts for 15% of GDP, improvements to port infrastructure will be critical if Bangladesh is to remain a competitive trading partner VENEZUELA Currency Inconvertibility & Transfer Risk Low Risk High Risk Legal & Regulatory Risk Sovereign Credit Risk Expropriation Contractual Agreement Repudiation Under Review (Monitoring for increased risk) Under Review (Monitoring for decreased risk) RWANDA Rating Outlook: Strikes, Riots and Civil Commotion; Sovereign Credit Risk With President Paul Kagame likely to remain in office until at least 2024, policy continuity is expected in the economic sphere, ensuring that real GDP growth remains robust at 6.2% in CHILE Rating Outlook: Strikes, Riots & Civil Commotion; Legal & Regulatory Risk In February and March 2017, a 43-day strike over contracts by 2,500 workers forced Anglo-Australian mining firm BHP Billiton to suspend operations at its Escondida site. GHANA Rating Outlook: War & Civil War; Sovereign Credit Risk; Contractual Agreement Repudiation In January 2017, the newly elected New Patriotic Party announced a USD 1.6 billion gap in the 2016 budget, administered by the previous government. 1 10

3 Risk Outlook 3 sebastorg / Shutterstock.com Venezuela Risk Outlook A wave of anti-government protests is likely to continue through 2017, elevating death and injury risks for foreign nationals. As Venezuela s economic crisis deepens and substantial debt repayments loom, a sovereign default is becoming increasingly likely in The business environment will remain extremely challenging for foreign investors, even if Maduro is removed from power, with expropriation an elevated risk. Security Environment Throughout April and May 2017 Venezuela has experienced continuous protests and civil unrest, which are likely to further intensify in the remainder of In the context of economic crisis, the opposition Democratic Unity Roundtable (MUD) has called for national protests, demanding early presidential elections and the release of political prisoners. Protests were further motivated in May 2017 by President Nicolas Maduro s announcement that a National Constituent Assembly would be created to rewrite the constitution, sidelining the opposition-controlled National Assembly. Protests have become increasingly violent, and security forces have responded with live ammunition. At the time of writing, 48 people had been killed in protests. Foreign nationals in Venezuela face an elevated risk of death or injury throughout the country. Businesses, particularly those in the retail sector, will also face a heightened risk of looting, given shortages of food, medicine, water and gas. 100 businesses are reported to have been looted since April Protests are increasing pressure on Maduro, making it unlikely that he will remain in office until the end of his term in However, the ending of the recall referendum process in October 2016 makes it difficult to remove Maduro through the legal system. This makes Maduro s ouster through coup or military intervention increasingly likely. Currently, the military remains loyal to Maduro and this is critical to his survival. However, in the case of a sovereign default, Maduro would be unable to meet military salary payments, elevating the risk of military intervention in politics and regime change. Trading Environment Venezuela is in a state of economic crisis, and will continue to be so throughout Real GDP reportedly contracted by 18.6% in 2016, whilst inflation is expected to reach 3,000% in Foreign investors will also face elevated currency inconvertibility and transfer risks. Capital controls have been in place since 2003, alongside a complex multiple exchange rate system. Businesses must navigate complicated regulations in order to qualify for access to foreign currency. This process is likely to become more stringent as foreign reserves are strained in the current crisis. Continued on page 4

4 4 CREDIT, POLITICAL AND SECURITY RISKS Risk Outlook June 2017 The risk of a sovereign default is also significantly elevated in Venezuela faces around USD 9 billion in debt repayments in 2017, over half of which are interest and principal obligations relating to state oil company PdVSA. Foreign currency reserves stood at USD 10.2 billion in April 2017, the lowest level since 2002, further reducing state capacity to meet payment obligations. If PdVSA defaults this year, the government would lose its only significant income stream, almost certainly causing a government default. However, the government will try to meet its payment obligations. Gas shortages in April 2017 were reportedly caused by reduced fuel imports, as the government tried to maintain hard currency reserves ahead of a USD 3 billion debt repayment. Investment Environment Venezuela will continue to present an extremely challenging business environment for foreign investors in Government policy is likely to remain highly interventionist as long as the ruling Partido Socialista Unido de Venezuela (PSUV) remains in power, even if Maduro no longer holds the presidency. Venezuela will continue to present an extremely challenging business environment for foreign investors in Expropriation risks are elevated. On 20 April 2017 the Venezuelan government seized a vehicle assembly plant in Valencia belonging to the US largest car manufacturer, General Motors. The company was forced to cease operations in the country and lay off around 2,700 workers. The incident is the latest in a string of expropriations in Venezuela. In July 2016, an industrial plant belonging to US consumer care company Kimberly Clark was seized, while in 2013 Superior Energy Services had two oil rigs seized by Venezuelan state oil company PdVSA. Arbitration awards from the International Centre for Settlement of Investment Disputes (ICSID) Tribunal are difficult to enforce in Venezuela, as the government is keen to avoid exacerbating its strained debt position further by paying out large sums. However, the government is also wary of having its assets abroad seized, and so is willing to enter into joint ventures with foreign firms, instead of paying awards. In 2016, Gold Reserve, agreed to enter into a joint venture to develop the Brisas and Las Cristinas mining projects, after being awarded USD 770 million by ICSID. See full pricing outlook for Venezuela on page 11. RATING OUTLOOK Strikes, Riots & Civil Commotion; Country Economic Risk; Sovereign Credit Risk; Expropriation sebastorg / Shutterstock.com

5 Risk Outlook 5 Bangladesh Hafiz Johari / Shutterstock.com Risk Outlook A number of opportunities will exist for foreign investors in Bangladesh s infrastructure sector, in particular in port development projects. Improving port capacity is critical if Bangladesh is to maintain its status as a competitive trading partner. However, institutional weaknesses will elevate the risk of contract cancellations or project delays. A weakened security environment will elevate the risk of property damage, death and injury for companies operating in Dhaka. Security Environment Islamist terrorist attacks against groups including religious minorities, secular bloggers, security forces and foreign nationals will remain a risk in the medium term, particularly in Dhaka. The risk will be exacerbated by the Awami League-led government s suppression of opposition parties, such as Jamaate-Islami, which will make militancy increasingly attractive. Islamic State (IS) has also developed a presence in Bangladesh. In July 2016, the group claimed an attack on a café popular with foreigners in the capital Dhaka, in which 20 people were killed. Whilst counterterrorism efforts have prevented any other major incidents since then, IS will continue to see Bangladesh as an attractive target. In March 2017, an IS-affiliated militant detonated a suicide bomb inside a military compound in Dhaka, wounding two security personnel. Attacks are most likely to involve small arms and improvised explosive devices, and will elevate death, injury and property damage risks for businesses operating in Bangladesh. Trading Environment Bangladesh will sustain robust economic growth in 2016/17, achieving a 7.1% expansion in real GDP. This will occur despite reduced export earnings from the ready-made garment industry, which accounts for 80% of total exports. Headwinds to the sector are largely a result of weak demand from key markets, such as the United States and the European Union. The government is anticipated to increase public spending in 2017 to support short term economic growth in the face of a weak external sector. The FY2016/2017 budget projects expenditure growth of around 31%. Additional spending will primarily target non-developmental expenditure, such as pay, subsidies and transfers. A projected 36% expansion in revenues will mitigate any significant expansion in the budget deficit in FY2016/17.

6 6 CREDIT, POLITICAL AND SECURITY RISKS Risk Outlook June 2017 Sovereign credit risks are moderated by a favourable debt structure. Multilateral and bilateral funding constitutes 46% of general government debt and Bangladesh s membership of the International Development Association means that most of this funding is held on concessional terms. As a result, whilst Bangladesh has posted consistent fiscal deficits over the last decade, it has not accumulated unsustainable debt levels. General government debt stood at 27.2% of GDP in Improved tax collection, a result of a Value-Added Tax (VAT) rise and changes to tax administration, will provide an upside to sovereign credit risk in 2017, enhancing the government s capacity to withstand economic shocks and invest in infrastructure. Investment Environment The Bangladeshi government will take an accommodative stance towards investment in port infrastructure, Bangladesh will sustain robust economic growth in 2016/17, achieving a 7.1% expansion in real GDP. given their strategic importance to the economy. Existing ports at Chittagong and Mongla are shallow-water facilities, which require large ships to transfer cargo to smaller vessels before bringing it to shore, causing delays which reportedly cost as much as USD 15,000 a day. Given that exported apparel accounts for 15% of GDP, improvements to port infrastructure will be critical if Bangladesh is to remain a competitive trading partner. The sector has received investor interest from major regional players, such as China, Japan and India. Japan International Cooperation Agency approved a USD 3.6 billion loan for the construction of a new deep-water port at Matabari Island. Project delays may arise from the government s poor implementation of its infrastructure spending plans. Bureaucratic rules around public procurement and inefficient cooperation between government departments mean that the government frequently fails to meet its spending targets. For example, in February 2016, Dhaka cancelled the Sonadia port project. Chinese companies had already completed a feasibility study and promised funding for the project. In FY2015/16, only 69% of the development budget was utilised. Similarly, whilst the FY2016/17 budget marked an increase of 17.9% to the development budget, actual spending in Q1FY2016/17 declined by 7.0% yearon-year. See full pricing outlook for Bangladesh on page 11. RATING OUTLOOK Terrorism; Contractual Agreement Repudiation

7 Risk Outlook 7 Rwanda Risk Outlook President Paul Kagame is expected to be re-elected in the August 2017 presidential election, given the lack of credible opposition and his popularity among Rwandans. Despite some criticism of Kagame s authoritarian tendencies, his victory will be risk positive for Rwanda in the medium term. Policy continuity on the economy and business will ensure robust growth and investor interest in a range of sectors, including infrastructure and ICT. Security Environment The risk of civil unrest in the run-up to Rwanda s August 2017 presidential election is limited. Incumbent President Paul Kagame is expected to win a third term. Despite criticism that Kagame has presided over increased repression of political opposition, he remains popular with the electorate. Having restored political stability in Rwanda following the 1994 genocide and delivered annual average real GDP growth of 8.0%, Kagame was re-elected in 2010 with 93% of the vote. Kagame s popularity, alongside the weakness of the political opposition, tight control of civil society and an effective security service, means that the election is expected to pass without protests or riots. The most significant election related security threat stems from isolated lowcapability grenade attacks in Kigali. In the run-up to the 2010 presidential election, The risk of civil unrest in the run-up to Rwanda s August 2017 presidential election is limited. 10 grenades exploded in Kigali, resulting in five deaths and 73 injuries. A repeat of such incidents in 2017 would have a minimal impact on business operations in Rwanda, as they are not likely to occur in central business districts of Kigali. However, there remains a low risk that personnel may be injured or killed in such explosions. Trading Environment With Kagame likely to remain in office until at least 2024, policy continuity is expected in the economic sphere. Whilst this will ensure that real GDP growth remains robust at 6.2% in 2017, rates will be below historic averages. Between 2011 and 2015, real GDP growth averaged 7.6%. Decelerating growth will be a result of reduced household consumption, in the wake of droughtrelated inflationary pressures. Moreover, a number of major infrastructure projects were completed in 2016, leaving a weaker project pipeline in Looking further ahead, however, these investments should begin to deliver returns. The USD 1 billion Kigali Conference Centre will facilitate Rwanda s goal of being a regional leader in business tourism. As a result, growth will recover to 7.0% in Rwanda s government debt has risen over recent years, rising from 20.5% of GDP in 2010 to a forecasted 51.7% of GDP. Despite this, sovereign credit risks remain moderate. Increased debt levels have been the result of carefully managed investment in growth-positive infrastructure projects, which will yield long term economic benefits.

8 8 CREDIT, POLITICAL AND SECURITY RISKS Risk Outlook June 2017 As a result, debt should peak in 2021, at around 61.5% of GDP, and thereafter fall as economic growth strengthens. Despite allegations of political repression, Rwanda maintains robust relationships with Western aid donors, and Kagame s re-election will not materially change this. A USD 204 million International Monetary Fund Standby Credit Facility, agreed in June 2016, will ease debt repayment stresses. Chile Risk Outlook Chile s mining sector will face a number of headwinds in 2017, as contract renewals lead to protracted, and potentially violent, strike activity. Despite a generally supportive business environment, more stringent environmental regulations will weigh on the cost competitiveness of the mining sector. Investment Environment Policy continuity during a third Kagame term will ensure on-going investor interest in Rwanda. The government worked to improve the business environment in recent years, introducing a new investment code in The code removed minimum investment thresholds in key sectors, opening up opportunities in industries such as business process outsourcing. In addition, investing over USD 50 million in energy, health, ICT, tourism or manufacturing can secure a seven year tax holiday. Rwanda s non-residential construction sector will offer a substantial number of investment opportunities. The government is keen to transform Rwanda into a knowledge-based economy, partly by establishing itself as a regional hub for ICT and business tourism. Central to these plans is the construction of the USD 1.9 billion Kigali Innovation Centre (KIC), which will enable Rwanda to develop human capital and house technology companies. In a mark of Rwanda s attractiveness to foreign investors, the KIC will also host Swedish telecommunications firm Ericsson. Projects such as this, alongside investment in transport and power, will support construction sector growth of 10.1% in See full pricing outlook for Rwanda on page 11. RATING OUTLOOK Rating Outlook: Strikes, Riots and Civil Commotion; Sovereign Credit Risk Security Environment There is an elevated risk of strikes and protests in Chile s mining sector in 2017, as a number of mines face contract renewal negotiations with workers. In February and March 2017, a 43-day strike over contracts by 2,500 workers forced Anglo-Australian mining firm BHP Billiton to suspend operations at its majorityowned Escondida site. It is estimated that the halt in production cost BHP Billiton and its partners almost USD 1 billion. The strike ended without resolution, as workers invoked the right to extend their previous contracts by 18 months. Further to this, contract renewal talks are due in at least 15 other mines in 2017, including at mines owned by state-firm Codelco and Anglo-Swiss company Glencore. Violent protests in relation to labour disputes can cause property damage for private companies. An estimated 300 protesters attacked installations and cut power supplies at the Escondida mine during strike action in February There is an elevated risk of strikes and protests in Chile s mining sector in 2017, as a number of mines face contract renewal negotiations with workers. A similar incident occurred in November 2016 when protesters stormed the Los Bronces copper mine, setting fire to barricades and causing mining company Anglo American to suspend operations for three days.

9 Risk Outlook 9 Trading Environment Chile s economic performance will be weak in 2017, with real GDP growth forecasted at 2.0%. There are a number of headwinds to the economy. In Q1 2017, disruptive strikes at the Escondida mine and a destructive wildfire weighed on economic activity. Mining strikes have strained the economically important mining sector, which has already been under pressure as a result of low mineral prices and falling ore grades. The mining sector lost 8.4% of its workforce in Economic activity will be driven by private consumption in the medium term, which is forecasted to grow by 2.2% year-on-year in Chile has strong sovereign credit credentials. The budget deficit is expected to remain stable at 2.8% of GDP in 2017, as the government complies with a fiscal rule requiring a cyclically adjusted balance. As a result, the 2017 budget cut spending on capital expenditure. However, it may become increasingly difficult for the government to rein in spending. 70% of the budget is spent on wages, social security and subsidies, areas in which it is politically difficult to implement cut backs, particularly ahead of the November 2017 general election. Chile s economic performance will be weak in 2017, with real GDP growth forecasted at 2.0%. Investment Environment Chile is the world s biggest producer of copper, and a supportive business environment has facilitated its position as a top investment destination for global mining firms. Confiscation or expropriation of assets is unlikely in Chile. The country has the highest number of free-trade agreements in the world, many of which provide protection of assets from expropriation. However, the mining sector s value is expected to contract by 1.5% in 2017, partly as a result of stringent environmental regulations weighing on cost competitiveness. The country s environmental regulator, the Superintendencia del Medio Ambiente, has been pursuing mining companies who fail to adequately manage scarce water resources. In October 2016, the body brought nine charges against the Los Pelambres copper mine, operated by Antofagasta Minerals, for mismanaging water. In August 2016, Kinross Gold halted operations at the Maricunga mine after the government shut down the mine s water system, citing environmental damage. Environmental scrutiny may also tighten in 2017, as a result of a pending glacier protection law. The act still requires congressional approval, but if enacted could result in planned projects that affect Chilean glaciers being cancelled or subject to contract revisions. See full pricing outlook for Chile on page 11. RATING OUTLOOK Strikes, Riots & Civil Commotion; Legal & Regulatory Risk

10 10 CREDIT, POLITICAL AND SECURITY RISKS Risk Outlook June 2017 Ghana Risk Outlook Sovereign credit risks are elevated in Ghana in 2017, following the announcement of a larger than previously disclosed budget deficit. However, the country has good relations with external creditors, allowing continued access to financial inflows. The recently elected New Patriotic Party (NPP) is expected to pursue fiscal consolidation, although strategically important port development projects are unlikely to be affected by budget cuts. Security Environment A maritime territorial dispute with Côte D Ivoire moderately elevates the risk of interstate war, which could impact Ghana s oil and gas sector. The dispute stems from an undefined maritime border between the two states, with the affected area also holding significant crude oil and natural gas reserves. This includes the Jubilee Field and the Tweneboa-Enyenra-Ntomme (TEN) fields. The situation is unlikely to escalate into an active conflict, as both countries are keen to protect their image as stable Sub-Saharan African states. Moreover, Ghana and Côte D Ivoire are pursuing international arbitration through the International Tribunal for the Law of the Sea, with a final ruling due in September An interim ruling in 2015 allowed Ghana to develop an offshore project in the affected area, but banned any new drilling. The tribunal will likely rule in favour of Ghana, but both countries are expected to abide by the final decision. Trading Environment Sovereign credit risks in Ghana are weighted to the downside, given a growth slowdown in 2016, elevated debt burden and a recent announcement of a larger than previously disclosed budget deficit. In January 2017, the newly elected NPP announced a USD 1.6 billion gap in the 2016 budget, administered by the previous National Democratic Congress (NDC) government. The government debt ratio has increased by nearly 30% in the last 5 years, with total debt standing at over 74% of GDP in February In March 2017, the government released its 2017 budget statement, which aims to reduce the deficit from 8.7% of GDP in 2016 to 6.5%. The government is seeking to achieve this through a 1.1% reduction in capital expenditures. On the whole, economic growth is forecasted to rebound in 2017, reaching 6.3% from 3.8% in 2016.

11 Risk Outlook 11 Ghana s stable political environment has allowed it to maintain positive relationships with external creditors. This enabled robust financial inflows in 2016, even as macroeconomic performance worsened. These relationships will continue to support short-term liquidity in In 2016, Ghana was able to attract hard-currency flows including a USD 750 million Eurobond, a USD 1.8 billion cocoa pre-export loan and a USD million domestic bond. In 2017, Ghana will be able to access around half of its USD 918 million International Monetary Fund financial package. Investment Environment Despite weakened debt fundamentals, the Ghanaian government will continue to prioritise investment in infrastructure development, supporting construction sector growth of 4.2% in Investment in infrastructure is central to Ghana s future growth prospects, and is therefore likely to be shielded from major budget cuts. Investment in ports will be of particular importance, as Ghana looks to establish itself as a transport and logistics hub in West Africa, offering maritime access to landlocked neighbours including Burkina Faso and Mali. A USD 334 million expansion of Takoradi port is currently underway, and expected to be completed in 2019, whilst Ghana Oil Company is also financing a new oil and gas tank terminal at Takoradi. Contracts signed by the previous administration may face an elevated risk of review, amendment or cancellation in The NPP have signalled their intention to review contracts on a case-by-case basis to ensure Ghana s stable political environment has allowed it to maintain positive relationships with external creditors. cost-effectiveness under its fiscal consolidation programme. Contracts in the telecommunications sector will be at particular risk. The introduction of the Electronic Communications (Amendment) Bill in March 2016 allows the government to alter contracts with a view to reducing fraud and ensuring value-for-money in the sector. See the full pricing outlook for Ghana below. RATING OUTLOOK War & Civil War; Sovereign Credit Risk; Contractual Agreement Repudiation Pricing Outlook CEND RISK PRICING RANGE SOVEREIGN CREDIT RISK PRICING RANGE FULL POLITICAL VIOLENCE (PV) PRICING TERRORISM & SABOTAGE ONLY PRICING Venezuela Underwriters are not currently accepting Venezuelan risks. Underwriters are not currently accepting Venezuelan risks % p.a % p.a. Bangladesh 1.0% - 2.0% p.a. 1.75% % p.a. * % p.a % p.a. Rwanda 1.0% - 2.0% p.a. 2.0% - 2.5% p.a % p.a % p.a. Chile 0.4% - 0.5% p.a. 0.5% - 0.7% p.a % p.a % p.a. Ghana 0.4% - 1.0% p.a. 1.5% - 3.0% p.a.** % p.a % p.a * Capacity is limited in the market. ** There are notable capacity constraints in the market, and it can be challenging to obtain underwriter support for Ghana non-payment risks.

12 JLT Specialty Limited provides insurance broking, risk management and claims consulting services to large and international companies. Our success comes from focusing on sectors where we know we know we can we can make make the the greatest greatest difference difference using insight, using intelligence insight, intelligence and imagination and to imagination provide expert to provide advice expert and robust advice and often unique robust often solutions. unique We build solutions. partner teams to We work build side-by-side partner teams with to you, work our sideby-side the market with you, to our deliver network responses and the which network and are market carefully to deliver considered responses from which all angles. are carefully considered from all angles. [Insert division text] As one of the world s strongest credit, political and security risks teams we help banks, commodity traders and corporations to understand, mitigate and transfer the effects of political and country economic risk, counterparty (credit) risk, political violence and kidnap & ransom. Through a relationship driven, consultative approach we use a systematic methodology to quantify, prioritise and minimise your company s political risk, security and trade credit exposures. 12 CREDIT, POLITICAL AND SECURITY RISKS Risk Outlook June 2017 CLAIMS DATA Claims management is central to the value that we seek to add at JLT, and foremost in our minds when we work for any client. Claims are not an afterthought; they drive our placing process. JLT has a diversified client base by sector and geography and JLT has had all Political Risk Insurance claims either paid in full, settled in agreement with the client or withdrawn by the client. Please see below for historic claims data for the countries covered by this report: LOCATION YEAR INDUSTRY SECTOR SUMMARY OF CIRCUMSTANCES Venezuela 2013 Oil & Gas CEN Expropriation: Potential Political Risk Claim - Business Interruption Venezuela 2010 Commodity Trading Contract Frustration Non-Payment Venezuela 2006 Commodity Trading Contract Frustration: Inconvertibility Loss Ghana 2016 Commodities Non-Payment of Sums Due Ghana 2011 Banking Contract Frustration Non-Payment Chile 2015 N/A Malicious Damage to Public Property Chile 2013 N/A Malicious Damage to Public Property CONTACTS JLT CREDIT, POLITICAL & SECURITY RISK EXPERTISE Ruth Lux Senior Consultant, JLT Specialty +44 (0) ruth_lux@jltgroup.com Eleanor Smith Political Risk Analyst, JLT Specialty eleanor_smith@jltgroup.com This newsletter is published for the benefit of clients and prospective clients of JLT Specialty Limited. It is intended only to highlight general issues relating to the subject matter which may be of interest and does not necessarily deal with every important topic nor cover every aspect of the topics with which it deals. If you intend to take any action or make any decision on the basis of the content of this newsletter, you should first seek specific professional advice. JLT Specialty Limited The St Botolph Building 138 Houndsditch London EC3A 7AW Lloyd s Broker. Authorised and regulated by the Financial Conduct Authority. A member of the Jardine Lloyd Thompson Group. Registered Office: The St Botolph Building, 138 Houndsditch, London EC3A 7AW. Registered in England No VAT No June Organisations with international operations are exposed to counterparty and country risks in the course of their daily trade and investment. The diversity of JLT s client base reflects the fact that all balance sheets can benefit from the leverage and protection given by structured use of credit and political risk insurance. JLT has been a leader in political risk insurance since the advent of the market in the early 1980s and enjoys strong relationships with all insurers in this sector. At any one time we manage upwards of USD 60 billion of insurance capacity and we have had extensive success in collecting claims on our clients' behalf. The insurance contracts we arrange relate to a wide variety of transactions brought about by our diverse client base and we also offer a range of risk consulting services.