As a regional pacific island natiion, Fiji has a relative small-scale economies and domestic markets. Fiji’s economy is highly dependent on a narrow range of limited resources and products, such as sugar, gold and tourism. Additionally, Fiji has a very instable political environment, because it already had taken four coups out from 1987 to 2006. Obviously, froeign investment is facing serious political risks. As Bernstein defined risk as “nothing more than uncertainty about the decisions that other human beings are going to make and how we can best respond to those decisions”(bernstein, 2001: p. 9), it makes sense to identify political risk as the likelihood that a host country may make political decisions that will prove to have adverse influences on the profits of investors or corporations. In this essay, there are three main issues will being discussed and analysed in the following paragraphs. In the first part, the importance of political risk management and sources of risks will be discussed in this part. In addition, some specific evident variables in Fiji that may lead to political risks will be analyzed as well. In the second part, an analysis of the level of exposure to political risk for different business will be provided, and an assessment system of political risk will be given, what is more, some specific examples drawn from Fiji case study will be presented in this part. In the final part, the meaning of relative bargaining power in view of the topic question will be described, and the essay will rate the relative competitive advantages of Fijian military government and vatuloula gold mine site with respect to the nature and extent of the government’s future intervention in VGU’s gold mining operation. After that, a discussion conclusion and points summary would be concluded in this essay. 论文范文http://www.chuibin.com/

　　The importance of risk management and political risk variables in Fiji

　　In today’s business world, in order to explore more international markets and generate new profits, it is very common for international corporations to take foreign investments in different countries, so international investment is becoming a commercial trend now. However, different country has a different political environment, such as different political system, it means there are also some political risks behind investment opportunities. For many international companys, this kind of political risks are closely related with the success of foreign investment activities, because there are some political events which will cause a potential harm to a business operating in overseas markets. The increasing amount of resource assigned to foreign investment by more and more MNCs has produced specific interest in evaluating the relationship between the foreign investment and factors affecting the investment decision. In these factors, political environments have been realized to be one of leading factors in examing a direct foreign investment in a foreign contry (Erol, 1985, Kobrin, 1979).

　　So how to manage and assess a country’s risk, how to minimise risk and cost, it has been becoming a very important issue for many foreign investors. In order to carry out an excellent risk management for foreign investments, first of all, for MNCs, it is very crucial and useful to analyse a range of variables that causing the political risks. There are three broad sources of political risks: political instability, weak governance and conflict.(McKellar, 2010, p.64). Economists indicate that political instability will be serious harmful to economic performance, political instablility is likely to lead to more frequent policy switch, it is negatively affecting the microeconomic environment for foreign and domestic investors, at the same time, it will lead to lack of security for foreigners’property. For example, In Fiji’s case, Fiji has a extremely instable political environment, in 2006, Fiji’s military commander bainimarama took a coup to depose the democratically

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