Political Risks Of A Country And Micro Analysis

1283 Words Feb 14th, 2016 6 Pages
One of the first steps in managing political risks is to analyze the political environment for risks to the business. According to Luthans, the analysis of risk can be done with two types of political risk analysis, Macro and Micro Analysis. Macro Analysis is an analysis of political ideas and decisions that will impact all businesses in a country and Micro Analysis is an analysis of governmental regulations and policies that affect a specific sector of on economy or market such as the auto industry (Luthans, 2015). However, there are other risks that can be more difficult to analyze such as terrorism especially in today’s political unrest. Some major corporations have spent thousands of dollars on macro and micro analyses just to have a world event disrupt or completely destroy operations. Tata motors dealt with political battles as well as a terrorist event. In a USA Today article titled “India 's Nano goes on sale” Sharon Silke reported that the Launch of was Six weeks late after political battle over the land where the car was to be built. She also reported that terrorist attacks in November of the year prior to the Nano’s launch would affect its future success. When the Nano was first unveiled the economy was in a good state where gas prices were rising and the world economy was becoming more stable. This would improve the future for many lower income families in India allowing them to improve their socioeconomic standing which in turn would have enable more…
Open Document