Political Risks Inherent in Foreign Investment Regarding Tariffs: A Recent Example From Cambodia

2 Pages Posted: 6 Jun 2019

See all articles by Alan Franklin

Alan Franklin

Global Business Risk Management

Date Written: May 17, 2019

Abstract

This article looks at the risks inherent in foreign investment using Cambodia as an example. Companies are either investing in Cambodia to establish factories for export of garments, or are using Cambodian based suppliers for supply of garments. This development was based upon the availability of cheap labour in Cambodia, as well as duty free entry of these goods to the European Union and other developed stated.

The EU is now in the process of imposing hefty tariffs on imports from Cambodia, both for economic as well as human rights reasons.

The article therefore suggests various methods that are available to investors to anticipate such risk factors and mitigate them to the extent possible.

Keywords: foreign investment, risks, tariffs, EU, political risk insurance

JEL Classification: M16, M21, M48, F21, F23, F53, K33

Suggested Citation

Franklin, Alan, Political Risks Inherent in Foreign Investment Regarding Tariffs: A Recent Example From Cambodia (May 17, 2019). Available at SSRN: https://ssrn.com/abstract=3390021 or http://dx.doi.org/10.2139/ssrn.3390021

Alan Franklin (Contact Author)

Global Business Risk Management ( email )

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