Abstract

Private sector companies engaging in cross border trade and/or investments in emerging market economies are faced with risks that are different from risks in domestic markets. Emerging markets often offer opportunities for high returns, but at the same time the risks, including both commercial and non-commercial/political risks, can be high. Risk mitigation can thus be beneficial. The article discusses the opportunities and the challenges that private companies may face when engaging in trade and/or investment in emerging markets. It will then discuss options for using risk mitigation instruments offered by export credit agencies (ECAs). The article also discusses recent examples of cross border trade and projects in emerging markets to illustrate how those instruments have been applied in real world situations. KEY WORDS: Cross border trade and investment, emerging markets, export credit agencies (ECAs), commercial and non-commercial risks, and risk mitigation instruments.

Full Text
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