Assessing Global Political Risks

Types of Political risk Companies have to evaluate all the possible risks that could happen in the potential foreign market. Companies have to evaluate all the possible risks that could happen in the potential foreign market. There are four types, and they must all be considered. There are four types, and they must all be considered.

Risk of General Political Instability Stability = good for business. Stability = good for business. What does “political stability” mean to you? What does “political stability” mean to you? This is a consideration of businesses who are thinking of moving into a new market AND companies who are already in foreign markets. This is a consideration of businesses who are thinking of moving into a new market AND companies who are already in foreign markets. Business in those countries might be affected which would also hurt profits. Business in those countries might be affected which would also hurt profits.

Ownership Risk Protectionism and nationalism could lead governments into takeovers and nationalization of certain industries. Protectionism and nationalism could lead governments into takeovers and nationalization of certain industries. If a country wanted to take over it’s transportation or resource infrastructure, companies in these industries would be affected. If a country wanted to take over it’s transportation or resource infrastructure, companies in these industries would be affected.

Operations Risk There is always a chance that laws change, and new regulations are passed or removed. There is always a chance that laws change, and new regulations are passed or removed. This would effect how companies run in foreign countries. This would effect how companies run in foreign countries. Taxes, import restrictions, new employee rights laws, etc. Taxes, import restrictions, new employee rights laws, etc.

Transfer Risk Sometimes governments change their currency policies. Sometimes governments change their currency policies. This could mean that companies are not allowed to send money out of the country. This could mean that companies are not allowed to send money out of the country. Governments could make their currency “inconvertible.” Governments could make their currency “inconvertible.” Being made to give foreign earnings back to the foreign government is called Repatriation of Earnings. Being made to give foreign earnings back to the foreign government is called Repatriation of Earnings.

What are some questions that businesses should ask? Is terrorism a possibility? More than a possibility, but should it be expected? Is terrorism a possibility? More than a possibility, but should it be expected? Could extremist groups endanger society’s stability? Could extremist groups endanger society’s stability? Have there been any freedoms taken away from the people? Have there been any freedoms taken away from the people?

What are some questions that businesses should ask? How involved in government is the military? How involved in government is the military? Is corruption part of daily business here? Is corruption part of daily business here? Could religious or ethnic pressures threaten your employees/property? Could religious or ethnic pressures threaten your employees/property?

Consequences of Terrorism A terrorist attack, or even the THREAT of an attack can have a large impact on international business. A terrorist attack, or even the THREAT of an attack can have a large impact on international business. What kinds of things can happen? Think of all the things that international businesses require to run properly. What kinds of things can happen? Think of all the things that international businesses require to run properly.

Laws and Legal Concerns International businesses have to be aware of all the laws in all the countries that the business operates in. International businesses have to be aware of all the laws in all the countries that the business operates in. Employment Employment Export/Import Export/Import Human Rights Human Rights Taxes Taxes Intellectual property Intellectual property Defence (Canada/US) Defence (Canada/US)