Country Risk
Country Risk refers to the potential for financial loss or negative impact on investments due to political, economic, or social instability in a specific country. It encompasses various factors, including government policies, political events (such as elections or unrest), economic conditions (like inflation or recession), and currency fluctuations. Country risk can affect foreign investments, lending, and trade, making it crucial for investors and businesses to assess the risk associated with operating in or investing in a particular country. Effective management includes conducting thorough country risk assessments, diversifying investments, and monitoring geopolitical developments.
Basel scope:
- Pillar 2
Capital requirements:
Mitigated by Capital
