political risk


The risk of loss when investing in a given country caused by changes in a country's political structure or policies, such as tax laws, tariffs, expropriation of assets, or restriction in repatriation of profits. For example, a company may suffer from such loss in the case of expropriation or tightened foreign exchange repatriation rules, or from increased credit risk if the government changes policies to make it difficult for the company to pay creditors.

Use political risk in a sentence

You need to make sure that you don't ever do or say anything that may put you at any political risk.

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There's a huge political risk buying Iranian textile products, but the profit trade off tends to be too tempting for many brands to resist.

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With the political turmoil in Nigeria, consisting of shootings and different forms of terrorism, investors see a huge political risk for future investments as they could potentially loose money in that country.

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