Risks Associated With International Business

[raciohurg]

This post discuss
RISKS ASSOCIATED WITH INTERNATIONAL BUSINESS


Country risk is a broad measure that captures the risks of conducting business activities in a foreign country. Country risk is closely tied to strategic risk. Countries are vulnerable to three general types of crises: Sovereign default, exchange rate, and banking system. Currency devaluations, foreign exchange controls, and other political actions such as nationalisation or asset expropriation can affect domestic and foreign banks. Currency devaluations increase a bank's exposure to credit, price, and liquidity risks. On occasion, country risk concerns in one country may spread to other countries with similar characteristics or where risks can be transmitted through trade linkages or the financial markets.





A currency crisis in one country that extends to neighbouring countries and trading partners could increase a bank's exposures to price risk through an unexpected increase in market volatility across asset classes. This situation is commonly referred to as contagion risk. Using banks as a case study, risks associated with an international business include credit risk, interest rate risk, liquidity risk, price risk, operational risk, compliance risk, strategic risk, reputational risk, information and technology (IT) risk, cybersecurity risk, and emerging risks.





Now, let us discuss risks associated with an international business using banks as a case study.


es risks associated with international business.

 

[StevenMorrison]

I can totally relate.

 

[JaneBower]

Hi there! Your post on the risks was informative. As someone interested in finance, I found your breakdown of the different risks banks face when engaging in international business activities very helpful. I like reading articles on business and financial topics like successionresource.com, so this one was also helpful. Understanding these risks is crucial for anyone interested in international finance, and your post is a great resource. Thanks for sharing!

 

[Roshuang]

Very interesting discussion

 

[TimFerris]

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