ABSTRACT
WHY INVEST ABROAD? Every firm that considers investing abroad must weigh the potential advantages against the potential risks. To do that, in-house analysis must identify and evaluate key factors. There are several reasons to consider initially why firms should invest abroad, and a few general factors can be linked to the overall level of risk a particular host country holds for an MNC making a foreign direct investment. These factors include the attitude of the host country’s government, the political system in place, the level of public discon-
tent or satisfaction, the unification or fragmentation of the local society on cultural and religious lines, the kind of internal and external pressures faced by the government, and the history of the country in the past few decades. In the pages that follow, we address each of these concerns in turn.
