Country Risk

Country Risk refers to the economic, political, and social risks tied to doing business in a specific nation. It includes exchange rate fluctuations, economic instability, and changes in government policies. These factors affect a business’s operations and financial obligations.

Examples of economic risks include inflation, recession, and currency devaluation. Political risks include corruption, expropriation, and political unrest. Social risks encompass population demographics, labor relations, and social movements.

Businesses must assess these risks to manage potential impacts effectively on their operations and strategy.