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The Financial Crisis and Political Risk
The financial and economic turmoil being felt globally has placed a strain on both developed and emerging economies. The global pressure on liquidity may result in potential payment defaults by sovereigns and increased risk of transfer restrictions. In this feature, Business Monitor International looks at the sovereign risk ratings in Latin America and assesses the situation in Ecuador. Control Risks foresees that investors will reassess their perceptions of political risk and will consider ways to manage risks upfront - whether through assessment and monitoring or by using mitigation tools.

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Political Risk Insurance and the Environment
PRI providers can help in the fight against climate change by being environmentally responsible in the way they conduct business, support 'green' projects, and innovate to meet the needs of this growing market. Carbon finance is one area where investors are supported and can find new mechanisms to reduce risk as can be seen by the launch of Zurich's new carbon credit product. Support is growing for cleaner energy projects as groups such as the Asian Development Bank are collaborate on financing and risk management options for these projects.

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‘South-South’ FDI and Political Risk Insurance: Challenges and Opportunities
Political risk perceptions and mitigation tools used by South-based MNEs differ from those of firms in industrialized countries, but this is changing, says the latest issue of MIGA Perspectives. This feature highlights the changing risk perceptions of South-based investors and experiences of individual political risk insurance providers, drawing on contributions for India, China, ATI and ICIEC.

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Political Risk in Africa's Changing Environment
Sub-Saharan Africa is changing, as countries reform their business environments. New opportunities abound in infrastructure and other sectors. BMI looks at opportunities and risks with a ranking exclusively developed for telecoms. MIGA Perspectives looks at the region's challenges, such as the perceived high political risk. While businesses use a variety of instruments to mitigate risk, Collective Action: Business Responses to Political Risk in Africa discusses how the private sector can improve Africa's investment climate through collective action.

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Political Risk Insurance Claims: The Changing Picture
Despite the proliferation of international investment agreements, investor-state disputes are on the rise, according to a recent article by UNCTAD, posing challenges in formulating agreements that provide a secure environment. Investor-state disputes often lead to actual claims by holders of political risk insurance. OPIC reports in 'Claims–The Picture To-date' that while outright expropriations had become virtually extinct, there are signs raising alarms that we may see a return to the overt nationalizations of the 1970s.

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Addressing Political Risk in the Extractive Sector
With resource nationalism on the rise, lenders are turning to political risk insurance to mitigate risks in the extractive sector, says a recent article, by Export Development Canada. These risks are becoming more significant according to a Client Alert by Latham & Watkins. A new issue of MIGA Perspectives presents voluntary tools that companies may use to ease such risks, but proposes that ultimately risk mitigation is achieved through political risk insurance.

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Political Risk Insurance and Terrorism
In the face of ongoing terrorist attacks in hotspots around the world, perceptions of terrorist threat continue unabated. This is despite the partial success of counterterrorism efforts since 2001, finds a recent report by ControlRisks, a specialist risk consultancy firm. These concerns have led to the unprecedented growth of the standalone terrorism insurance market, which filled the void created when general insurers bailed out of terrorism liability after 9/11.

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