Country Risk Analysis at the Sports Exports Company
Response to the following problem:
The Sports Exports Company produces footballs in the United States and exports them to the United King- dom. It also has an ongoing joint venture with a British ?rm that produces some sporting goods for a fee. The Sports Exports Company is considering the establishment of a small subsidiary in the United Kingdom.
1. Under the current conditions, is the Sports Exports Company subject to country risk?
2. If the ?rm does decide to develop a small subsid- iary in the United Kingdom, will its exposure to country risk change? If so, how?