Political risk

Since the latter half of the 20th century the need has grown significantly for investors of money (and other resources), in regions/countries that are new to them and/or are subject to instability, to understand the political risk associated with such investment/involvement and how this can be mitigated. This need has had various drivers, including the desire to build new markets, often in areas subject to political uncertainty and instability.

However, it is not only businesses who want to understand and reduce political risk but also governments and NGOs as they seek to work with and in countries around the world. Specific concerns can be, government instability, nationalisation, currency inconvertibility, expropriation of profits and property, changes in the taxation regime, terrorism, levels of crime and threats to the security of personnel and increasingly the ethical concerns associated with corporate social responsibility objectives and reputations.

Careers

Political risk analysts may work within government, global businesses, international organisations, insurance companies, consultancies, banks, rating agencies, security consultancies or for a growing number of online sites that specialise in the sale of political and economic risk information. The businesses and organisations listed below include risk management consultancies and information and analysis providers and advisers.

The Multilateral Investments Guarantee Agency (MIGA), part of the World Bank Group, website contains useful information on Political Risk Insurance (PRI) and this includes lists of PRI providers, intermediaries, advisors and consultants.

Internships

Internships and similar are an important route into employment in political risk analysis as some evidence of relevant experience/interest is usually required.

Qualifications

There is no one ideal degree subject but history, politics, economics, law, international relations, development studies and related degrees are likely to be regarded as particularly relevant . Although not always essential, a postgraduate degree can be an asset especially if it brings expertise in a country or region and experience of conducting research. It is also possible to move into political analysis from other career areas, e.g. journalism, law, insurance, consultancy, banking and NGOs.

Skills

Relevant skills and competencies include, research and analysis, written and oral communication, time management, decision making, working with others and one or more languages in addition to English, e.g. Russian, Arabic, Farsi and Chinese can also be an asset.

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