In Summary
In 2025, the Allianz Social Resilience Index (SRI) records a third consecutive – albeit modest – improvement, but underlying divergence remains pronounced. The global average rose from 47.4 in 2024 to 47.9 (on a 0-100 scale) across 171 economies, driven by lower imported inflation pressures and greater currency stability in Emerging Asia and several advanced economies. Firmer governance was another driving force, including institutional stabilization in parts of Emerging Asia and Central Europe. At the same time, weaker social cohesion in the Middle East, Emerging Europe and high-income countries continued to weigh on social resilience. Northern European economies lead the ranking, with Finland (1st, 84.3), Denmark (2nd, 83.8) and Iceland (3rd, 81.4) at the top of our index. Germany (8th, 78.5), France (13th, 74.7), and the UK (18th, 72.9) remain strong, while Italy (28th, 66.8) and the US (32nd, 65.3) ranked lower but stayed in the top third. China (59th, 52.5), India (81st, 46.8), Mexico (105th, 41.3) and Brazil (112th, 40.0) ranked significantly lower, with conflict-affected states like Lebanon (169th, 17.7) and South Sudan (171st, 11.8) at the bottom.
The conflict in the Middle East and the resulting energy inflation will test the strength of social fabrics, particularly in countries such as Vietnam, Thailand, Morocco, Tunisia and Malaysia. The SRI helps measure vulnerabilities to such exogenous shocks: countries with weaker resilience and limited fiscal buffers could be particularly affected by higher-for-longer energy prices. Indeed, sustained energy-price increases raise inflation (including food inflation), weaken growth and heighten political tensions, particularly where societies have limited capacity to respond. Coping mechanisms will be pivotal, including crisis-response mechanisms, economic stabilizers and optionality. Two clusters stand out: Low-to-mid resilience economies with high exposure – including Vietnam, Thailand, Morocco, Tunisia and Malaysia – could see price spikes more easily translate into social pressures. Meanwhile moderate-resilience countries with medium exposure to the energy price shock – including Chile, Egypt, Serbia and South Korea – should be in a better position to cushion the impact of a temporary energy shock on social resilience. Europe is likely to be more affected than the US given its greater reliance on imported energy, though social spending may cushion the impact.
Taking the long view, four trajectories of global progress in social resilience emerge: low-resilience countries catching up (e.g., Romania and Saudi Arabia); countries weakening further (e.g., Nigeria and Brazil); high-resilience countries consolidating strength (e.g., Germany and Finland) and countries experiencing slippage (e.g., Canada and Sweden). Some countries seem stuck in a middle-social-resilience trap among these diverging paths. Rankings show limited change since 2024, though Sri Lanka (+12.7pts; +39 ranks) and India (+7.8pts; +27 ranks) improved notably, while Brazil (-8.7pts; -41 ranks) and the Czech Republic (-6.9pts; -15 ranks) saw steep declines. A cluster of advanced economies persistently scoring 65-70 – including Czechia, Hungary, Italy, the US and Japan – appears caught in a middle-SRI trap (in reference to the middle-income trap phenomenon coined by Indermit Gill and Homi Kharas in 2007). Material prosperity increasingly coexists with political polarization and policy volatility. Prolonged stagnation in this range risks greater instability, weaker reform capacity and declining policy predictability, with implications for long-term growth and sovereign risk. These tensions are increasingly visible: between 2020 and 2025, mid-resilience countries – including India, Indonesia, South Korea, the UK and the US – accounted for up to 70% of global strikes, riots and civil commotion (SRCC) events.
Social resilience matters for macroeconomic performance, capital-market development and sovereign risk. For investors and policymakers alike, the SRI functions as both an early-warning system and reform compass. Higher resilience is associated with stronger real GDP per capita growth. In high-income economies, higher SRI levels also correlate with deeper capital markets, suggesting stronger market stability and investor confidence. Sovereign exposure, contract frustration and operational disruption are distinct in their mechanics but interconnected in their root cause: low and deteriorating social resilience. Sharp deteriorations in the SRI have preceded episodes of sovereign stress by 12-24 months. Recoveries tend to be asymmetric, with resilience gains often preceding spread compression as markets reprice structural repair with a lag. Social resilience is not a one-way street: declines can be reversed where institutional credibility is strengthened, polarization reduced and opportunity broadened, whereas reliance on short-term fixes risks gradual erosion. For investors, tracking both the level and momentum of the SRI sharpens sovereign risk assessment and helps anticipate structural turning points; for policymakers, sustained reform rather than reactive crisis management remains central to rebuilding long-term resilience.