Country risk September 2009: Methodology
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Country risk September 2009: Methodology

Country risk September 2009: A world in flux

To obtain the overall country risk score, Euromoney assigns a weighting to nine categories. These are political risk (25% weighting), economic performance (25%), debt indicators (10%), debt in default or rescheduled (10%), credit ratings (10%), access to bank finance (5%), access to short-term finance (5%), access to capital markets (5%) and forfaiting (5%).

Political risk (25%): the risk of non-payment or non-servicing of payment for goods or services, loans, trade-related finance and dividends, and the non-repatriation of capital. Risk analysts give each country a score between 10 and zero – the higher, the better.

Economic performance (25%): based on GNI (Atlas Method) figures per capita and on results of Euromoney poll of economic projections.

Access to bank finance (5%): calculated from disbursements of private, long-term, un-guaranteed loans as a percentage of GNP.

Source: World Bank.

Debt indicators (10%): calculated using these ratios from the World Bank’s Global Development Finance figures: total debt stocks to GNP, debt service to exports and current account balance to GNP. Developing countries that do not report complete debt data get a score of zero.

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