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COUNTRY RISK
The notion of country risk has always been familiar to large multinational corporations, but only recently have commercial banks become interested in the subject. Their interest has increased in direct proportion to their lending to non-oil exporting, less developed countries: from less than $15 billion in 1970 to $250 bilion in 1982. This book treats the subject from the bankers' point of view, with an emphasis on the risk of lending. However, some of the approaches described for the assessment and quantification of country risk can also be applied. with appropriate modifications, to direct investment.
Country risk evaluation is a recent discipline and is in process of rapid evolution. All that a book can achieve at this stage is to reflect very approximately the state of the art and to provide ideas and impetus to bankers, economists, students and academics worldwide to develop or improve their own approach. That is the purpose of this book, which is a considerably expanded version of the author's first book on the subject. The expansion is based on comments by readers and by participants in country risk seminars in London, New York and Hong Kong. The book begins with an executive summary, intended mainly for chief executive officers of internationally oriented banks.
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