Sinosure, China's only insurer specializing in export and credit insurance, yesterday launched a risk-analysis report covering 130 countries, a move aimed to help enterprises better hedge risks when doing business overseas.

Although emerging markets, such as those in Asia, Africa and Latin America, are still high risks for Chinese companies, they are major destinations for Chinese enterprises. Afghanistan and Iraq are given grade nine, implying that doing business there has the greatest risks.

"The biggest risks in those countries are political turbulence, potential terrorist attacks and changeable investment regulations," said Tang Ruoxin, general manager of Sinosure.

Luxembourg, Andorra and Liechtenstein are granted the highest rating, grade one, meaning they have the best overall environment for doing business.

"Quite a number of smaller countries in the Europe won very good ratings this year," said Tang, "But around 70 per cent of countries have a grade below five, which means a relatively high country risk. And they are mostly emerging economies."

Sinosure's report assesses country risks based on several indicators, such as the average default risk on corporate payments and to what extent a company's financial commitments are affected by the local business, financial and political situation. And it is the first time for Sinosure's report to cover all countries and regions in the world.

China's major trading partners, including the United States and Japan, were given grade two, the same as last year.

"One of our major concerns when doing overseas business is how to prevent potential risks effectively," said Jin Kening, general manager of China National Chemical Engineering Corporation, "And this report provide us with a perfect risks map."

ZTE, China's largest listed telecoms manufacturer, also has a similar experience. As a company that conducts around 40 per cent of its business overseas, ZTE is particularly alert to country risks.

"Our overseas business is mainly in Asia and Africa, both of which have comparatively higher risks," said Hou Weigui, president of ZTE. "And US$590 million of our exports were achieved with the support of Sinosure."

Export credit insurance is playing an increasingly important role in Chinese exports and helping China's enterprises as they venture into overseas markets. From 2004 to 2006, Sinosure provided insurance worth about US$70 billion to China's export sector.