Abstract
Political risk assessment (PRA) is one of the determinants of foreign direct investment (FDI) and the competitiveness of multinational corporations (MNCs), yet little is known about its use in African markets. This study critically investigates the PRA techniques used by MNCs in Nigeria and their applicability. It uses a multimethod approach to analyze data collected from MNCs and the data set of the International Country Risk Guide (ICRG) PRA annual rating for Nigeria from 2011 to 2015. The findings reveal that most firms use qualitative, rather than quantitative, PRA techniques. Regional variations in the outcome of PRA within Nigeria could also contribute to the low use of quantitative techniques. This article identifies that firms are prepared to invest in Nigeria, in spite of high political risk, due to its economic and financial attractiveness. This article’s findings offer some implications for practice with some suggestions on how it could influence firms’ internationalization and their conduct of PRA.
| Original language | English |
|---|---|
| Pages (from-to) | 133-142 |
| Number of pages | 10 |
| Journal | Thunderbird International Business Review |
| Volume | 61 |
| Issue number | 2 |
| Early online date | 4 Feb 2018 |
| DOIs | |
| Publication status | E-pub ahead of print - 4 Feb 2018 |
Keywords
- Africa
- foreign direct investment
- internationalization
- multinational corporations
- Nigeria
- political risk assessment
Access to Document
Other files and links
Fingerprint
Dive into the research topics of 'Political risk assessment by multinational corporations in African markets: a Nigerian perspective'. Together they form a unique fingerprint.Profiles
-
Dr James Mshelia
- University of Northampton, Strategy and International Business - Senior Lecturer in International Business
- Centre for Global Economic and Social Development
- Centre for Sustainable Business Practices
Person: Academic