PROVIDER: BANK OF AMERICA WORLD INFORMATION SERVICES
a. Products
Country Outlooks: Summary of business, financial and economic environment. Includes key economic historical and projected indicators.
Country Data Forecast: Country-specific forecasts of commonly used economic, financial and demographic variables.
Country Risk Monitor: Business risk ranking based upon economic and financial ratios.
b. Risk measurement components
I. Financial/Economic
Information Type: Quantitative
Data Source: Published Sources
Components:
Debt Service/Exports
External Debt/Exports
External Debt/GDP
External Debt/Reserves
Reserves/Imports
Import Coverage
Exports/GDP
Current Account/GDP
Budget Deficit/GDP
GDP per Capita/G-7 Average
ii. Summary Format
Risk Index Briefing (Country Outlook) Economic/Financial Indicators
iii. Risk Index
Type: Ordinal
Components: Above Financial/Economic indicators, rank ordered, averaged.
PROVIDER: BUSINESS ENVIRONMENT RISK INTELLIGENCE (BERI) S.A.
a. Products
FORCE Country Reports: Qualitative analysis of socio-political, economic and financial forecasts. Scenario basis.
Political, operations and remittance/repatriation risk indices. Profit opportunity recommendation (POR) is a composite of the individual risk indices.
b. Risk measurement components
I. Political
Information Type: Qualitative
Data Source: Expert Panel
Components:
Political Factionalization
Linguistic/Ethnic/Religious Tension
Coercive Measures to maintain Regime
Mentality: Nationalism, Corruption, nepotism
Social Conditions: population, income distribution
Radical Left Strength
Dependence on outside major power
Regional Political Forces
Social Conflict
History of Regime Instability
ii. Operations
Information Type: Quantitative Qualitative
Data Source: Expert Panel
Components:
Policy Continuity
Attitudes towards foreign investors
Nationalization
Monetary Inflation
Balance of Payments
Bureaucratic Delays
Economic Growth
Currency Convertibility
Enforceability of Contracts
Labor Cost/Productivity
Professional Services and Contractors
Communications and Transport
Local Management and Partners
Short-term Credit
Long-Term Loans
iii. Remittances and repatriation of capital
Information Type: Quantitative Qualitative
Data Source: Expert Panel, Published Data
Components:
Legal Framework
Foreign Exchange
International Reserves
Foreign Debt
iv. Quantitative Index
Components:
Foreign Exchange
Foreign Debt
International Reserves
Budget Performance
v. Qualitative Index
Components:
Resolve towards honoring international obligations
Foreign loan structure and terms
Technocratic competence
Corruption
Concessionary loans and grants
vi. Summary Format
Briefing Risk Index
vii. Risk Index
Type: Ordinal Scalar
Components:
Weighted average of above components
PROVIDER: CONTROL RISKS INFORMATION SERVICES (CRIS)
a. Products
On-line country information services
Travel security guide
Security Risk ratings and security forecasts
b. Risk Index
Type: Ordinal (1-4)
Components:
Staff analysis (Methodology is not explained)
Government Survival
Likely Policy Continuity
Political Pressure on Economic Decisions
Criminal or terrorist threat
PROVIDER: Economist Intelligence Unit (EIU)
a. Products
Repayment risk measure
Regional and Country Reports
b. Risk measurement components
I. Political and Policy Risk
Information Type: Qualitative
Data Source: Staff Analysis
Components:
Economic Policy Factors:
Fiscal, Monetary and Export Policy
Attitude towards foreign investment
Ease of Structural and Policy Change
Size/Performance of public sector
Policy Consistency
Political and Strategic Factors:
Ability to implement economic policy
Operation of political system
New Regime policy continuity
Enfranchisement
Regional Context
ii. Medium-Term Lending Risk
Information Type: Qualitative
Data Source: Published Sources
Components:
External Debt
Debt Service
Current Account
Savings Rate
Export Concentration
iii. Short-Term Trade Risk
Information Type: Quantitative
Data Source: Published Sources
Components:
Foreign Exchange variables:
Import Cover Ratio
History of Foreign Exchange Transfers
iv. Summary Format
Briefing Risk Index Economic, payment, debt and trade indicators
v. Risk Index
Type: Ordinal Scalar
Components:
Weighted average of above components
PROVIDER: EUROMONEY
a. Products
Risk Assessment Index
b. Risk measurement components
I. Political
Information Type: Qualitative
Data Source: Survey of Experts
Components:
ii. Economic
Information Type: Quantitative
Data Source: Euromoney global economic projections
iii. Financial
Information Type: Primarily Quantitative
Data Source: Published Sources
Debt indicators
Debt in default or rescheduled
Credit Ratings (Moody's and Standard and Poor's)
Access to bank finance
Access to short-term finance
Access to international bond and syndicated loan markets
Access to and discount on forfeiting
iv. Summary Format
Risk Index (No briefing mentioned)
v. Risk Index
Type: Ordinal Scalar
Components:
Weighted average of above components
PROVIDER: INSTITUTIONAL INVESTOR
a. Products
Country Credit Rating Index
b. Risk measurement components
I. Political, Economic and Financial Variables
Information Type: Qualitative
Data Source: Weighted Survey of International Bankers
Components:
Economic Outlook
Debt Service
Financial Reserves/Current Account
Fiscal Policy
Political Outlook
Access to Capital Markets
Trade Balance
Inflow of Portfolio Investment
Foreign Direct Investment
ii. Summary Format
Credit Rating (No briefing indicated)
iii. Risk Index
Type: Ordinal Scalar
Components:
Weighted average of above components
PROVIDER: STANDARD AND POOR'S RATINGS GROUP
a. Products
Sovereign Credit Ratings
Local and foreign currency obligation ratings
Regional and local government obligation ratings
Sovereign-supported obligation ratings
Multilateral lending institution obligation ratings
International structured financing ratings
b. Risk measurement components (Only Sovereign Credit Ratings reviewed)
I. Political
Information Type: Quantitative Qualitative
Data Source: Published Data, Staff Analysis
Components:
Political System:
Stability
Orderliness of succession
System flexibility
Public participation
Characteristics of major political parties
Social Environment:
Living standards
Wealth and income distribution
Labor market conditions
Union politicization
Cultural/demographic characteristics
Literacy levels
Urbanization trends
Regional, racial, religious and other cultural differences
International Relations:
Integration with multilateral trade and international financial systems
Relations with neighboring countries
National security
ii. Economic
Information Type: Quantitative, Qualitative
Data Source: Published Data, Staff Analysis
Components:
External Financial Position:
Balance of Payments
International reserves
External debt
GDP
Exports
Economic structure and growth
Economic development
Natural resources
Rate and composition of growth
Economic Management
Budgetary performance
Social security system
Local government
Fiscal flexibility
Tax structure
Current and capital accounts
Wage behavior incentives
Exchange rate policy
Long-term economic efficiency
Economic Prospects
iii. Summary Format
Risk Index (No Briefing mentioned)
iv. Risk Index
Type: Ordinal
Components:
Composite of above factors.
PROVIDER: POLITICAL RISK SERVICES: ICRG
a. Products
Country Risk Ratings
b. Risk measurement components
I. Political
Information Type: Qualitative
Data Source: Staff Analysis
Components:
Economic Expectations
Economic Planning Failures
Political Leadership
External Conflict
Corruption
Military in Politics
Organized Religion in Politics
Law and Order Tradition
Racial and Nationality Tensions
Political Terrorism
Civil War
Political Party Development
Quality of the Bureaucracy
ii. Financial
Information Type: Quantitative, Qualitative
Data Source: Published Data, Staff Analysis
Components:
Loan Default/Unfavorable Restructuring
Delayed Payment of Suppliers Credits
Repudiation of Contracts by Governments
Losses from Exchange Controls
Expropriation of Private Investments
iii. Economic
Information Typel: Quantitative
Data Source: Published Data
Components:
Inflation
Debt Service
International Liquidity Ratios
Foreign Trade Collection Experience
Current Account Balance
Parallel Foreign Exchange indicators
iv. Summary Format
Briefing Risk Index
v. Risk Index
Type: Ordinal Scalar
Components:
Weighted Average of above components
PROVIDER: POLITICAL RISK SERVICES-COPLIN-O'LEARY RATING SYSTEM
a. Products
Country Risk Ratings: International Business Climate Index (IBC)
Various other indices are calculated from sub-components of the IBC index:
Financial Transfer Risk
Direct Investment Risk
Export Market Risk
b. Risk measurement components
I. Export Market
Information Type: Quantitative Qualitative
Data Source: Staff Analysis Expert Panel
ii. Financial Transfer
Information Type: Quantitative Qualitative
Data Source: Staff Analysis Expert Panel
iii. Direct Investment
Information Type: Quantitative Qualitative
Data Source: Staff Analysis Expert Panel
iv. Components: (The three above indices use an overlapping mixture of the following)
Turmoil
Restrictions on Equity
Restrictions on local operations
Taxation Discrimination
Repatriation Restrictions
Exchange Controls
Tariff Barriers
Nontarrif Barriers
Payment Delays
Expansionary Economic Policies
Labor Costs
Foreign Debt
Investment Restrictions
Restrictions on Foreign Trade
Domestic economic Problems
International Economic Problems
v. Summary Format: Briefing Risk Index
vi. Risk Index: Ordinal Scalar
PROVIDER: MOODY'S INVESTOR SERVICES
a. Products
Sovereign Foreign-Currency Debt Ratings
Credit Opinions for Governmental Bodies
b. Risk measurement components
I. Political Dynamics and Social Interaction
Information Type: Qualitative
Data Source: Staff Analysis
Components:
Potential for radical shift in leadership
Legal framework
Effective political structure
Income distribution
Religious, ethnic and linguistic differences
Single issue political movements
Social welfare policies
Organized protest/armed resistance
Political intrusiveness on cultivation of wealth
Depth and experience of government bureaucrats
Political intrusiveness on economic management
Political links with foreign partners
Past behavior under stress
Regime legitimacy
ii. Financial
Information Type: Quantitative
Components: Published Sources
Illiquidity
Debt burden
Balance of payments
Subnational governments
iii. Economic
Information Type: Quantitative Qualitative
Components: Published Sources, Staff Analysis
Policy environment
Infrastructure
Structure of production
Independent monetary authority
Labor market mobility
Interest rates
Foreign exchange
Quality of economic management
Dependency on export/import sectors
International capital flows
Ability to implement austerity programs
iv. Summary Format
Credit Opinion Summaries Debt Ratings
v. Risk Index
Type: Ordinal