Country risk analysis is an assessment of economic and political instability for the purposes of business. Global business is a complex issue. Country risk analysis involves a variety of factors to determine climate, revealing risk factors through research and generating a qualitative situational judgment. Common factors considered for examination are political, legal, and regulatory risks; exchanges and repatriation of funds risks; competitive risk assessment; taxation and double taxation risks; market risks, distribution and supply chain risks; social and cultural risks; cyber and technological risks; and the physical environment. Strategic planning and risk management initiatives leverage analysis results to crystallize well-formulated efforts and successfully achieve business goals.
Country Risk AnalysisThe United States is inarguably one of the wealthiest and most powerful nations in the world today. Despite the high-ranking status, not even the United States is free from the risk factors pertaining to country risk analysis. Dun & Bradstreet (dnb.com) provide country risk analysis among their extensive list of business information and consulting services.
The organization defines political risk as pertaining to indicators including "internal and external security situation, policy competency and consistency, and other such factors that determine whether a country fosters an enabling business environment" (http://www.coface-usa.com). The political stability of The United States is a positive indicator in this factor, but certain weaknesses reduce the overall viability of corporate expansion and investment within the country. From Coface, a leader in trade-risk management:Ã¢ÂÂ¢The country's sizeable current account deficit will ultimately necessitate economic and financial adjustments.
Ã¢ÂÂ¢Defective electric power networks and antiquated road, rail, and port infrastructure will necessitate major investments.
Ã¢ÂÂ¢An economy that is still not very fossil fuel efficient will have to make investments to meet environmental constraints.
Ã¢ÂÂ¢The combined effect of those weaknesses has burdened public finances and undermined American company competitiveness.
These issues will eventually require political,