Most industrial parks don’t include SCUBA divers in their recovery plans. But car companies and a shoe maker in Thailand – but nowhere near the ocean – had to hire divers to retrieve hard-to-replace moulds from submerged factories in November. “No one thought about such a worst-case scenario”, said one company president. “In future we will need to reconsider the flood risk.”

They sure will. Three (3) major rivers – the Chao Phraya, Lopburi and Pa Sak – converge around the industrial estates in Ayutthaya. But companies obviously decided that tax incentives and the proximity of suppliers outweighed the risks of catastrophic flooding. Or maybe they just skipped a risk assessment entirely.

Supply chain resilience strategy: don’t build a shoe-, car- or disk drive factory in a floodplain. Some companies may even avoid Thailand. Impact: if one Japanese multinational were to choose, say, Vietnam or Myanmar for its next factory, others would follow, beginning a chain of falling dominoes for Thailand – eventually. Prime Minister Shinawatra’s crisis management effort is just beginning.

• In addition to flooding and storms, risks in Asia include volcanoes, earthquakes and volcanoes with earthquakes – not generally worries in Europe or North America.

By Nathaniel Forbes, Forbes Calamity Prevention Pte Ltd, Singapore. Posted: 27 December 2011 at 4:53 pm (UTC +8 hours)