Assess Country Risk as Part of Market Entry
There is a risk to every shipment, whether in the U.S. or internationally. When evaluating a strategy for entering a new international market, be aware of potential risks and the resources that can help mitigate that risk. Then you can be as prepared as possible if an adverse event happens.
Country Factors to Research
- Political Stability
- Foreign Exchange Risk
- Economic Stability
- Legal System
- Intellectual Property Protection Laws
- Banking Structure
- Tax Implications
- Dispute Resolution Options
Resources and Assistance
- The U.S. Commercial Service, though trade professionals at U.S. Embassies and Consulates, can provide information about operating in the country.
- Learn in advance whether your product is subject to additional foreign duties as a result of a foreign trade remedy action. The International Trade Administration's Trade Remedies Compliance staff helps U.S. companies affected by foreign antidumping, countervailing duty and safeguard investigations of their exports.
- The World Bank's Ease of Doing Business country ratings.
- Country credit rating from major credit rating firms.
- Financial risk is one of the main areas of concern for many exporters. The Ex-Im Bank and Small Business Administration (SBA) offer several different programs which can help reduce a U.S. company’s financial risk for an international shipment.
- Ex-Im Bank Country Limitation Schedule – check to see if Ex-Im operates in your target market.
- OPIC Political Risk Insurance is specifically for opportunities in emerging markets.
- Get information and assistance about Protecting Intellectual Property.
- Your bank is also an important ally in mitigating financial risk for exports. Work closely and directly with your bank in preparation for an international transaction.