World Investment and Political Risk 2009

Political risk is a top concern for corporate foreign investors from industrialized but also developing countries when venturing into emerging markets. At the same time, these investors maintain a positive outlook on economic and business prospects...

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Bibliographic Details
Main Author:	Multilateral Investment Guarantee Agency
Format:	Publication
Language:	English
Published:	World Bank 2012
Subjects:	ACCESS TO FINANCING ACCOUNTING BALANCE OF PAYMENTS BALANCE OF PAYMENTS CRISES BANK DEPOSITS BANKING SECTOR BOND BUSINESS ENVIRONMENT BUSINESS ENVIRONMENTS CAPITAL ACCOUNT CAPITAL ACCOUNT TRANSACTIONS CAPITAL ACCOUNTS CAPITAL FLOWS CAPITAL MARKETS CDS COMMODITIES COMMODITY COMMODITY PRICE COMMODITY PRICES CONSUMER GOODS CONTRACT RENEGOTIATIONS CONTRACTUAL OBLIGATIONS CONVERTIBILITY RESTRICTIONS COPYRIGHT CLEARANCE COPYRIGHT CLEARANCE CENTER CORPORATE INVESTORS CREDIT AGENCIES CREDIT AGENCY CREDIT DEFAULT CREDIT DEFAULT SWAPS CREDIT GUARANTEE CREDIT RATING CREDIT RISK CREDIT RISK PREMIUMS CREDITORS CRITICAL MASS CURRENCY DEBT DEBT CRISIS DEBT FLOWS DECENTRALIZATION DEVELOPING COUNTRIES DEVELOPING ECONOMIES DIRECT INVESTMENTS DIVESTMENT DOMESTIC BANKS DOMESTIC FINANCIAL MARKETS DOMESTIC MARKETS DURABLE ECONOMIC CRISES ECONOMIC CRISIS ECONOMIC DOWNTURN ECONOMIC IMBALANCES EMERGING ECONOMIES EMERGING MARKET EMERGING MARKET ASSETS EMERGING MARKETS EMERGING-MARKET EQUITY FLOWS EQUITY FUNDS EQUITY INVESTMENT EQUITY MARKETS EXCHANGE CONTROLS EXCHANGE RATES EXPENDITURES EXPORT CREDIT EXPOSURE EXPROPRIATION EXPROPRIATION RISK EXPROPRIATION RISKS EXPROPRIATIONS FINANCIAL CONSTRAINTS FINANCIAL CRISES FINANCIAL CRISIS FINANCIAL INSTABILITY FINANCIAL INSTITUTIONS FINANCIAL LIBERALIZATION FINANCIAL MARKET FINANCIAL MARKETS FINANCIAL SERVICES FIXED INVESTMENT FLOATING EXCHANGE RATE FOREIGN ASSETS FOREIGN CURRENCY FOREIGN DIRECT INVESTMENT FOREIGN EXCHANGE FOREIGN FUNDS FOREIGN INVESTMENT FOREIGN INVESTMENT FLOWS FOREIGN INVESTMENTS FOREIGN INVESTORS FOREIGN MARKETS GLOBAL ECONOMY GLOBAL FINANCIAL MARKETS GLOBAL INVESTMENT GLOBAL INVESTORS GLOBAL TRADE GLOBALIZATION GOVERNMENT BUDGETS GOVERNMENT GUARANTEES GOVERNMENT INTERVENTION GOVERNMENT INTERVENTIONS GOVERNMENT REVENUES GROSS DOMESTIC PRODUCT GROWTH RATE GROWTH RATES HOME MARKETS HOST COUNTRIES HOST COUNTRY HOST GOVERNMENT HOST GOVERNMENTS INCOME INFORMATION SHARING INFORMATION TECHNOLOGY INFRASTRUCTURE PROJECTS INSURANCE INSURANCE INDUSTRY INSURANCE MARKET INSURERS INTELLECTUAL PROPERTY INTERNATIONAL BANK INTERNATIONAL COOPERATION INTERNATIONAL DEBT INTERNATIONAL DEBT MARKETS INTERNATIONAL INVESTMENT INTERNATIONAL TRADE INVESTING INVESTMENT CLIMATE INVESTMENT CORPORATION INVESTMENT DECISIONS INVESTMENT FLOWS INVESTMENT HORIZONS INVESTMENT OPPORTUNITIES INVESTMENT PROJECTS INVESTMENT REGIMES INVESTMENT REGULATIONS INVESTOR AWARENESS INVESTOR CONFIDENCE INVESTOR DEMAND INVESTOR PERCEPTIONS JOINT VENTURES LIABILITY LIQUIDITY LIQUIDITY CONSTRAINTS LOCAL CURRENCY LOCAL FINANCIAL MARKETS LOCAL GOVERNMENT LOCAL GOVERNMENTS LOCAL MARKETS LONG-TERM INVESTMENT MACROECONOMIC DATA MACROECONOMIC INSTABILITY MACROECONOMIC STABILITY MARKET CAPITALIZATION MARKET CONDITIONS MARKET INVESTORS MARKET MECHANISMS MONETARY FUND MONETARY POLICIES NATURAL RESOURCE NATURAL RESOURCES NET DEBT NEW MARKETS NEW PRODUCTS OIL PRICES OUTPUT OUTPUT GAP OUTPUT LOSSES POLICY RESPONSES POLITICAL RISK POLITICAL RISK INSURANCE POLITICAL RISKS PORTFOLIO PORTFOLIOS PRIVATE CAPITAL PRIVATE CAPITAL FLOWS PRIVATE CAPITAL INFLOWS PRIVATE CREDITORS PRIVATE DEBT PRIVATE DEBT FLOWS PRIVATE EQUITY PRIVATE INVESTMENT PRIVATE MARKET PROPERTY MARKETS PROPERTY RIGHTS REGULATORY ENVIRONMENTS REGULATORY FRAMEWORK REINSURANCE REINVESTMENT REMITTANCES RESERVE RESERVE BANK RESERVES RETURN RETURNS RISK AVERSION RISK MANAGEMENT RISK OF EXPROPRIATION RISK PREMIUMS SAVINGS SETTLEMENT SOCIAL RELATIONS SOVEREIGN ENTITIES SOVEREIGN GUARANTEES STOCK MARKETS TAX TERRORISM TRANSITION COUNTRIES TREATIES TREATY WEALTH EFFECTS WITHDRAWAL WORLD ECONOMY
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000333038_20091207034115 http://hdl.handle.net/10986/2688

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Summary:	Political risk is a top concern for corporate foreign investors from industrialized but also developing countries when venturing into emerging markets. At the same time, these investors maintain a positive outlook on economic and business prospects in the developing world, which is expected to attract a growing share of global foreign direct investment (FDI) as the world economy slowly, recovers. Positive business sentiment over emerging markets amid concerns over political perils point to a sustained need to mitigate these perils. This, added to the rise of South-based investors, offers opportunities and challenges for the political risk insurance (PRI) industry. In the current context of high uncertainty, understanding how investors perceive and deal with political risks helps to map out the role of PRI in the emerging post-crisis investment landscape. This report focuses on FDI and PRI for long-term investment, and only covers political risk in developing countries. Although political risk also affects other forms of private capital flows, these are beyond the scope of this publication. The main findings of the report are summarized as follows: i) while political risks top foreign investors' concerns, the global economic and financial crisis has not fundamentally altered FDI prospects for emerging markets; ii) concerns over political risks, combined with sustained FDI into emerging markets over the medium term, suggest a growing need for political risk mitigation and opportunities for the PRI industry; and iii) the emergence of South-based investors is increasingly shaping the global FDI environment and presents regional growth opportunities, but also challenges, for the PRI industry.

World Investment and Political Risk 2009

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