Analyzing the Cause of Political Risk Facing Multinational Corporations in Underdeveloped Nations

Dr. Orok B. Arrey

Analyzing the Cause of Political Risk Facing Multinational Corporations in Underdeveloped Nations

Dr. Orok B. Arrey * §

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§ FEDERAL UNIVERSITY WUKARI

Analyzing the Cause of Political Risk Facing Multinational Corporations in Underdeveloped Nations

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Abstract

The most important consideration for Western firms doing business in underdeveloped nations is political risk. Experts argue that political risk is any threat to the long run profitability of the company’s operations which grows not from the normal economic functioning of a society, but rather from nationalistic discriminatory actions of host countries. The pressure which might cause government to act in a manner adverse to the interest foreign investors in Africa may be viewed as falling into three categories namely; arising from system instability, those arising from resentment of foreign investment, those arising form conflict with perceptions of host country’s national interests. Interference is not necessarily always the result of antagonism to foreign investment. Balance of payment, monetary and fiscal problems can at time bring about restrictive actions that affect foreign and domestic businesses alike. This paper is focused on analyzing the cause of political risks facing multinational corporations in under-developed nations.

References

7 Cites in Article

Reference Format

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Funding

No external funding was declared for this work.

Conflict of Interest

The authors declare no conflict of interest.

Ethical Approval

No ethics committee approval was required for this article type.

Data Availability

Not applicable for this article.

How to Cite This Article

Dr. Arrey. 2013. "Analyzing the Cause of Political Risk Facing Multinational Corporations in Underdeveloped Nations". Global Journal of Management and Business Research, Global Journal of Management and Business Research - A: Administration & Management GJMBR-A Volume 13 (GJMBR Volume 13 Issue A9).

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GJMBR Volume 13 Issue A9

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Journal Specifications

Crossref Journal DOI 10.17406/GJMBR

Print ISSN 0975-5853

e-ISSN 2249-4588

Keywords

political risk underdeveloped nations Western firms

Classification

GJMBR-A Classification JEL Code: D72

O10

Submission ReceivedDecember 10, 2012
Peer Review Double Blind
Handling Editor
Accepted January 5, 2013
Published January 15, 2013

Version of record

v1.2

Issue date

September 29, 2013

Language

English

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Article Matrices

Total Score: 153

Country: Nigeria

Subject: Global Journal of Management and Business Research

Authors: Dr. Orok B. Arrey (PhD/Dr. count: 1)

View Count (all-time): 281

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Publish Date: 2013 01, Tue

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Total Views: 2K

Total Downloads: 118

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