Country Risk -- How to Create Scores
  • Country Risk Scores
    • SA Country Risk Scores (December 2016)
    • Risk Scores by Sector (December 2016)
    • "Heat Maps" of G-20+ Countries
    • Case Study: Brazil 2016
  • Traditional Country Risk
    • Economic Structure & Trends
    • Political Risk and Payment Performance
    • Global Environment
    • Capital Flows and Funding Risk
  • Build Your Own System
    • Selecting Variables
    • Countries and Data
    • Weighting Risks & Creating Scores
  • About US
    • Client Services
    • Contact Us

Assessing Country Risk
​How do analysts rank 50-100 countries?

SA Country Risk Scores:  December 2016

​Countries can be ranked across a vast array of Economic, Political, Social and Financial Variables.  To make sense of the myriad of possible indicators, Sovereign Analytics has developed multi-sector Risk Scores. These incorporate the leading scholarly research and market knowledge of Country Risk.  The Scores can be used as Early Warning Signals or forecasts of rising and falling risk.  SA Country Risk Scores and the associated Sector Risk Scores -- covering over 75 countries -- can be found in the Tabs below. 
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COUNTRY Risk Scores 2016
STRUCTURAL RISKs  2016
Sector Risks  2016

How Country Risk is Measured

Sovereign Analystics explains how Credit Rating Agencies (CRAs), international organizations (IFIs) and analysts at global banks assign country ratings or risk scores.  The essence of this process is to compare key ratios to rank a large number of countries, banking systems and borrowers. SA provides a careful description and critique of the conceptual framework behind this process.  This critique highlights a number of the deep flaws in the standard risk framework. This sets the basis for the Liquidity and Capital Flows approaches, which are at the heart of the SA risk assessments.
traditional risk measures
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Capital Flows and Funding Risk

Each sector of the economy has a financing requirement - the need to roll-over existing loans, to raise new capital or to fund new projects.  These inflows and outflows are at the heart of finance.  This section shows how the size of country's sectoral ​​​Financing Needs and Sources of Financing are the new pivot point in country risk. 
The role of capital flows

Global Inter-connectedness and Cross-Border Risks
The global financial crisis highlighted the deep interconnections between governments and banks, and between different types of financial institutions. The complex array of instruments and depth of global markets has underscored the need for a broader understanding of systemic risks and for enhanced regulatory oversight across borders.  This is the new realm of Country Risk.
Advanced Approaches
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  • Country Risk Scores
    • SA Country Risk Scores (December 2016)
    • Risk Scores by Sector (December 2016)
    • "Heat Maps" of G-20+ Countries
    • Case Study: Brazil 2016
  • Traditional Country Risk
    • Economic Structure & Trends
    • Political Risk and Payment Performance
    • Global Environment
    • Capital Flows and Funding Risk
  • Build Your Own System
    • Selecting Variables
    • Countries and Data
    • Weighting Risks & Creating Scores
  • About US
    • Client Services
    • Contact Us