FDI Risks

Foreign Direct Investment (FDI) risks refer to the potential challenges and uncertainties a company faces when investing in another country. These include political instability, which can lead to sudden changes in laws or government actions; currency fluctuations that affect the investment's value; economic instability causing unpredictable market conditions; legal and regulatory differences that may complicate operations; and cultural or language barriers. Additionally, conflicts like wars or sanctions, and the risk of expropriation or nationalization, can threaten the safety of an investment. Understanding these risks helps investors make informed decisions and develop strategies to mitigate potential losses.