Professional Documents
Culture Documents
Risk is a fact of business life, more so of international business. The Management of International business is the management of risk. No manager can make a strategic business decision or enter into important business transaction without a full evaluation of the risks involved. Many of the best business plans have been ruined by a miscalculation or a mistake, or an error in judgment that could have been avoided with proper planning.
If the risk cannot be reduced through advance planning and careful execution, perhaps it can be shifted to some other party to the transaction. If the risk cannot be shifted to another party to the transaction, it might be shifted to an insurance company. Many types of risks can be insured against, including the risk of damage to the goods at sea, the risk of loosing an investment in a developing country and many others.
Political Risk is generally defined as the risk to a firms business interests arising form political instability or political change in a country in which the firm is doing business. Political Risk includes risk derived from potentially adverse actions of Governments of the foreign countries in which one is doing business or whose laws and regulations one is subject to. It also includes laws and Government policies instituted by the firms home country which adversely affect the firms that do business in a foreign country.
Suggested Readings
(1) International Marketing Management-an Indian perspective by R.L Varshney and B.Bhattacharya, Sixth Edition, 2006 published by Sultan Chand and Sons, New Delhi. (2) International Business Law and its Environment by Richard Schaffer, Beverley and Filiberto Augsti, Sixth Edition, 2005 published by Thomson South-Western United States. (3) Manual on Export Documentation published by Commercial Law Publishers (India) Private Limited, NREW Delhi, 2006. (4) International Business Law, Text, Cases and Readings, Fourth Edition, 2004. Published by Prentice Hall, U.S.A (5) International Marketing by Philips R.Cateora and John L. Graham published by Tata McGraw Hill (6) International Business by Charles W.L Hill and Arun K.Jain published by Tata McGraw-Hill Publishing Company Limited, New Delhi. (7) Export and import Management by Aseem Kumar published by Excel Books, 2007