39 / 80
Risk =
Risk of an
economy
being
harmed by
an external
economic
shocks
Vulnerability
(adds to risk)
EXPOSURE
Inherent features of
an economy rendering
it exposed to external
shocks
Inherent Features
●
Trade openness
●
Export Concentration
●
Dependence on strategic imports
●
Proneness to natural disasters
- Resilience
(reduces risk)
COPING ABILITY
Policy-induced measures
that enable an economy
to withstand external
shocks
Policy Measures
●
Macroeconomic Stability
●
Market flexibility (adjusted
for financial riskiness
●
Good governance
●
Social development
● Environmental management
The V&R Framework
5. The Vulnerability/Resilience Framework