Macro Country Risk

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Macro Country Risk

The risk that a foreign government will significantly alter its policies or other regulations so that it significantly affects all investment in that country. More broadly, it can apply to the risk that a nation will refuse to comply with an agreement to which it is a party, or that political violence will hurt an investment or business. For example, if one exports goods to a foreign nation, and that nation elects a new government that enacts protectionist tariffs, this will negatively impact all exports, rather than simply one export business.