Political Risk and Foreign Direct Investment

John N. Kallianiotis

Chapter Chapter 5 in International Financial Transactions and Exchange Rates, 2013, pp 181-214 from Palgrave Macmillan

Abstract: Abstract Political risk is any foreign/host-country government’s intervention in multinational corporations’ (MNCs) operations with different regulations that are considered from the MNC’s perspective to be discriminatory, unfair, wealth-depriving, and costly for the corporations. Political risk takes various forms, ranging from changes in tax regulations, exchange controls, stipulations of local production, expropriation, discrimination against foreign businesses, restrictions on assets, forcing local investment for their profits, restrictions on borrowing, restrictions on deposits (lately, we have experienced levy of taxes on deposits, too), to restrictions on their general operations.

Keywords: Exchange Rate; Foreign Direct Investment; Host Country; Foreign Investment; Joint Venture (search for similar items in EconPapers)
Date: 2013
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DOI: 10.1057/9781137356932_5

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