Political risk is a type of risk faced by investors, corporations, and governments that political decisions, events, or conditions will significantly affect the profitability of a business actor or the expected value of a given economic action.

1. Political Risk
Aseel Ali 17/11/2021

2. Political risk is a type of risk faced
by investors, corporations, and
governments that political
decisions, events, or conditions
will significantly affect the
profitability of a business actor or
the expected value of a given
economic action.
What
is
Political
Risk
What is Political Risk

3. Businesses are affected by the decisions governments make that can affect individual
businesses, industries, and the economy. These include taxes, spending, regulation,
currency valuation, trade tariffs, labor laws and environmental regulations.
Types
of
Political
Risk
Types of Political Risk
Also, there are both macro- and micro-
level political risks.

4. Macro-level
macro-
and
micro-level
political
risks.
Micro-level
Macro-level political risks have similar impacts across all foreign actors in a given location.
Micro-level risks focus on sector, rm, or project speci c risk.
•
•
•
•
•
•
Change to tax and labor laws
Regulatory restrictions on business
Currency and exchange controls
Terrorist Activity
Expropriation or government seizure of property
War
•
•
•
•
•
Specific regulations
Contract equipment
Tax discrimination
Profit restrictions
Violence

5. •
•
•
Monitor
Reduce
Insure
Managing
Political
Risk
Managing Political Risks

6. Thank you