Political Risk
Safeguarding Investments and Loans in Emerging Markets
The financial crisis that spread rapidly around the globe beginning in late 2008 had a negative impact on all countries but has also created opportunities, particularly in Asia.
Pursuing business opportunities in emerging markets can be extremely rewarding, but it comes with an added element of risk from the potential for political and economic instability. Most foreign governments seek to attract foreign capital and promote investment, but the political environment in many countries is one of constant change, some of it potentially harmful to business operations. The global financial crisis has also created an environment with a heightened potential for political risk events to take place.
Several events over the last 12 to 18 months - even here in Thailand - have reminded investors and financial institutions that, despite many opportunities across the region, Asia remains a complicated and risky political environment.
Social instability and adverse government actions are among the most common examples of political risks that investors and financial institutions face when trading with or investing in these countries.
