Cherry Reynard asks if political risk is always synonymous with emerging markets or if it is more the case that in the present climate of upheaval the economic risks of the developed markets present a greater danger for investors
In recent years there has been a reappraisal of the risk/reward characteristics of emerging markets. The traditional view of emerging markets as high-risk has evaporated as their economic position has looked increasingly strong when compared with many of the debt-ridden, crisis-prone developed markets. But this reappraisal has relied on the benign political backdrop that has characterised emerging markets over the past few years. The Georgia situation has threatened that and forced a re-examination of political risk in these countries. But to what extent has this changed the outlook for eme...
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