Country risk

Short description: Risk of investing or lending in a country

Categories of

Financial risk
Credit risk

* Concentration risk

Market risk

* Interest rate risk
* Currency risk
* Equity risk
* Commodity risk

Liquidity risk

* Refinancing risk

Operational risk

* Country risk
* Legal risk
* Model risk
* Political risk
* Valuation risk
* Moral hazard

Reputational risk
Volatility risk
Settlement risk
Profit risk
Systemic risk
Non-financial risk

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Country risk refers to the risk of investing or lending in a country, arising from possible changes in the business environment that may adversely affect operating profits or the value of assets in the country. For example, financial factors such as currency controls, devaluation or regulatory changes, or stability factors such as mass riots, civil war and other potential events contribute to companies' operational risks. This term is also sometimes referred to as political risk; however, country risk is a more general term that generally refers only to risks influencing all companies operating within or involved with a particular country.

Political risk analysis providers and credit rating agencies use different methodologies to assess and rate countries' comparative risk exposure. Credit rating agencies tend to use quantitative econometric models and focus on financial analysis, whereas political risk providers tend to use qualitative methods, focusing on political analysis. However, there is no consensus on methodology in assessing credit and political risks.

## Contents

* 1 Ratings
* 2 Partial list of credit risk rating agencies
* 3 Partial list of political risk analysis organizations
* 4 See also
* 5 References
* 6 External links
* 6.1 Downloadable country analysis and reports

## Ratings

Higher scores in this table indicate less risky countries.

Country risk rankings Q4 2017  The least-risky countries for investment  Rank | Rank change | Country | Overall score

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1  | — | Singapore | 88.6
2  | — | Norway | 87.66
3  | — | Switzerland | 87.64
4  | — | Denmark | 85.67
5  | ▲2 | Sweden | 85.59
6  | ▼1 | Luxembourg | 83.85
7  | ▼1 | Netherlands | 83.76
8  | ▲4 | Finland | 83.1
9  | — | Canada | 82.98
10  | ▲1 | Australia | 82.18
Score out of 100. Rank change to previous quarter.

Source: Euromoney Country Risk - published January 2018.[1]

Ratings are further broken down into components including political risk and economic risk. Euromoney's quarterly country risk index “Country Risk Survey” monitors the political and economic stability of 185 sovereign countries. Results focus foremost on economics, specifically sovereign default risk and/or payment default risk for exporters (a.k.a. “trade credit” risk).

## Partial list of credit risk rating agencies

* Fitch Ratings (U.S.)
* Moody's (U.S.)
* Standard & Poor's (U.S.)
* CTRISKS (Greater China)

## Partial list of political risk analysis organizations

* Euromoney Country Risk, ECR
* IHS Country Risk
* BMI Research
* Country Risk Solutions
* Economist Intelligence Unit
* Eurasia Group
* Maplecroft
* Oxford Analytica
* The PRS Group, Inc.

## See also

* Credit rating agency
* National average salary
* Offshoring
* Workforce productivity
* EMBI+
* List of countries by natural disaster risk

## References

1. ↑ [1] : Survey which monitors the political and economic stability of 185 sovereign countries, according to ratings agencies and market experts. The information is compiled from Risk analysts; poll of economic projections; on GNI; World Bank’s Global Development Finance data; Moody’s Investors Service, Standard & Poor’s and Fitch IBCA; OECD consensus groups (source: ECGD); the US Exim Bank and Atradius UK; heads of debt syndicate and loan syndications; Atradius, London Forfaiting, Mezra Forfaiting and WestLB.

## External links

### Downloadable country analysis and reports

* Coface Economic Studies
* Credendo Country Risk Ratings
* The Benche Analysis & Reports[Usurped!]
* Euler Hermes Country Reports
* Maplecroft
* The PRS Group, Inc.

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Lists of countries by political rankings

Freedom|

* Political
* Freedom in the World
* Democracy Ranking
* Press
* Freedom House
* Reporters Without Borders
* Economic
* Fraser Institute
* The Heritage Foundation/The Wall Street Journal
* Trade

Corruption|

* Bribes
* Corruption barometer
* Corruption perceptions

Competitiveness|

* Composite Index of National Capability

History|

* Empire size
* Flag adoption date
* Formation date
* Geopolitical changes

Rights|

* Rule of Law Index
* Privacy
* Property rights
* Democracy Index
* Democracy-Dictatorship Index
* Gender Gap Index
* LGBT rights

Other|

* Discrimination and violence against minorities
* Government transparency
* Ease of Doing Business Index
* Environmental Performance Index
* Fragile States Index
* Good Country Index
* Globalization Index
* Global Innovation Index
* Global Peace Index
* Global Terrorism Index
* Global Liveability Ranking
* Prosperity Index
* Incarceration rate
* Political terror scale
* Global Slavery Index
* OECD Better Life Index
* Satisfaction with Life Index

* List of international rankings
* List of top international rankings by country
* Lists by country

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