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Libya 'little risk' for businesses

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LONDON, England -- While the terrorist threat in Iraq has increased, Libya is among the safest places to do business, according to a new global risk assessment.

Moammar Gadhafi's North African state, which recently pledged to give up its weapons of mass destruction, ranks with Scandinavia and much of Eastern Europe as being relatively safe from terrorism, organized crime and political violence.

In contrast, Iraq has moved from virtually nowhere to fifth place, behind Kashmir, the Palestinian territories, Colombia and India, according to the assessment by international insurance brokerage Aon.

In Aon's 2004 league table of terrorism hot spots -- part of its annual global terrorism risk map -- Chechnya, Afghanistan, France, Northern Ireland and Pakistan round out the top 10.

Risk management experts say increased terrorist activity worldwide is damaging business confidence.

"The threat is increased, and we've seen terrorist activity take on more of a global stance," Paul Bassett, Aon's executive director of counterterrorism and political risk, told CNN.

"We are urging businesses to be more cautious. ... What may happen in Singapore in terms of a modus operandi of a terrorist group could happen in London, Paris or indeed New York," he said.

"So businesses now need to consider the effect terrorist groups are having all around the world, not just in the countries where their main locations are."

Aon based its map -- which gives each country a ranking of "low," "guarded," "elevated," "high" or "severe" -- on the number of terrorist attacks around the world.

"The definition of terrorism is now very broad," says Basset. "It includes groups that are motivated for political means, but religious and ideological motivation also counts as factors."

With the increase in terrorist activity and kidnappings in Iraq, Aon says it expects the country to overtake Kashmir as the world terrorist threat hotspot this year.

Meanwhile, Martin Stone, Aon's director of counterterrorism and political risk, said Libya deserved its low rating.

"It's an exceptional situation where there are no indigenous terror groups and a highly controlled population, just as Iraq was until Saddam was kicked out," Stone told The Times newspaper.

"Western interests in Libya are almost exclusively in the energy sector, which the Libyan government has a strong interest in protecting. That means there are few attractive targets for terrorists and easier countries for them to operate in."

In March, Tony Blair became the first British prime minister to visit Tripoli since Winston Churchill during World War II.

Blair praised Gadhafi's work in dismantling his chemical, nuclear and biological programs, under plans he announced in December, and said his cooperation with Britain and the U.S. sent a strong signal to the Arab world. (Full story)

Aon, the company that published the survey, had offices on three floors of the World Trade Center and lost 175 employees in the September 11 attacks.

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