Question

Please explain how Monitoring political developments and planning accordingly can alleviate political risks of doing business abroad.

Answer 1

Doing business overseas is not a easy task, Al lot of risks are involved which needs to be assessed prior to initiate the plans, there are various kinds of political risks associated with the international business such as war and civil unrest,disturbed diplomatic relations, hostility from locals, and volatile foreign governments.instability of exchange rates and associated restriction.if proper research work and planning is not done in relation to politocal risk then a business might get into trouble an heavy losses.A better understanding of how political events could affect your investments, The ability to grab opportunities in markets that could be very profitable, but involve political risks. The ability to make better decisions about how to reduce your political risks.is an essential element.

A proper person must be assigned responsibility to keep an eye on political movements in a country.he must monitor all the changes that might impact the business settlement. first there is a need to identify the risk and the level of hazard it can cause to objectives of the business, After finding out the risks involved one needs to understand the level of impact each risk can cause and rank them accordingly. there is a need to mitigate the risk by taking appropriate steps. further there is need to keep monitoring the risk management process. also taking external help of embassies , government related agencies etc who could tell the risks prevelant in a particular country. Governement also offers political risk insurance to shield the companies.

This is how they can mitigate the risks and hence settle there business peacefully,