According to Professor Okolo : " This area is affected by the currency exchange rate , government flexibility in allowing the firms to repatriate profits or funds outside the country . The devaluation and inflation will also affect the firm 's ability to operate at an efficient capacity and still be stable . " Furthermore , the taxes that a company has to pay might be advantageous or not . It might be higher or lower in the host countries . Then " the risk that a government will indiscriminately change the laws , regulations , or contracts governing an investment — or will fail to enforce them — in a way that reduces an investor 's financial returns is what we call ' policy risk . ' " Terrorism is a voluntary act of violence towards a group ( s ) of people . In most cases , acts of terrorism is derived from hatred of religious , political and cultural beliefs . An example was the infamous 9/11 attacks , labeled as terrorism due to the massive damages inflicted on American society and the global economy stemming from the animosity towards Western culture by some radical Islamic groups . Terrorism not only affects civilians , but it also damages corporations and other businesses . These effects may include : physical vandalism or destruction of property , sales declining due to frightened consumers and governments issuing public safety restrictions . Firms engaging in international business will find it difficult to operate in a country that has an uncertain assurance of safety from these attacks
9/11 attacks
September 11 attacks
International business