Country Risk Investment Model

Quantify country risk in financial terms to inform more profitable investment decisions – by sector and project type

Accurate investment and project-specific evaluations of risk, that considers country, sector, and project-type, can unearth investment opportunities that, on first assessment, appear too risky. Our Country Risk Investment Model forecasts and measures the expected financial impact different types of risk will have on cash flows and investment returns. Utilizing our country expertise, sector analysis, and granular risk scores allows you to accurately forecast, quantify, and compare the financial viability of new investments and existing business activities.

Investors, corporate finance & strategy teams, risk management groups, insurers, and project and business development groups use our Country Risk Investment Model to:

Quantify country risks, in financial terms, generating specific Net Present Value (NPV) and Internal Rate of Return (IRR) to test potential investments against changing risk scenarios
Compare and evaluate different potential investments and projects within a country, across a region, or around the world
Assess the value of political risk insurance based on the location and sector of an asset
Identify the risks that are impact future cash flows and target risk mitigation strategies to improve the long-term profitability of investments
Monitor and assess evolving country risks overtime to optimize investment strategies and inform the timing of potential exit strategies.

Our advantage

Current proxies for country risk, like commonly used sovereign risk indicators, reflect a limited view of commercially relevant risks and don’t account for the significant impact different sectoral risk profiles can have on profitability. Our model integrates the full spectrum of commercially relevant political, economic, legal, tax, operational, and security risks and models their impact on future cash flows by sector, and by project phase. This results in a more accurate and actionable forecast of future cash flows allowing you to precisely value and compare potential investments in a single country, across a region, and around the world.

Solutions

Country Risk Investment Model

Get full access to the model configuration with the ability to change model parameters and input client-specific cashflow data by investment. An expert-led workshop is provided to discuss the appropriate parameters for your sector and investment-types, and to calibrate the model to your specifications. Best used for profitability evaluation and optimization, risk mitigation and investment prioritization, and strategic investment decisions.

Country Risk Premiums

Access fast and quantifiable country risk premiums, risk adjusted cashflow forecasts. Results are tailored by sector to evaluate and compare potential new investments. Best used for Investment decision support and new market entry analysis.

Country Risk Investment Scenarios

Building on the Country Risk Premiums, get realistic and relevant scenarios along with the full model output to evaluate the sensitivity of potential and existing investments to changing country risk scenarios. Best used for stress-testing, due-diligence evaluation, and broader portfolio analysis.

Country Risk Premiums for Insurance

Quantify the value of potential political risk insurance to your projects. Project investors require cover for political risks, which otherwise increase the return that the investment must generate. CPR for Insurers assesses the value of political risk insurance and can help mitigate risk costs. Read our white paper to understand our methodology.

Research and Analysis

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Country Risk Investment Model

Quantify country risk in financial terms to inform more profitable investment decisions – by sector and project type

Our advantage

Solutions