Staying the Course. Taking a long view of Foreign Direct Investment

You either don’t do it, or do it. But if you choose to do it, do it right. I am talking here about direct investment into foreign markets. As once you decide to do it, you have to commit and you cannot be scared. There may be military coupes, economic and political crises, disease pandemics, natural disasters, competitive threats, criminal threats and other very unpleasant events. Each one has to be carefully and rapidly assessed, and in some cases any of these events, or a combination of them, may force you to abandon your chosen market. More often than not, however, these events are precursors of bigger and better things and overcoming them may be a highly rewarding experience down the line.
The article below underscores a very important aspect of doing business in Emerging Markets. In-depth understanding of the situation, long-term view and ability to adjust and adapt to most extreme scenarios.

With Mideast Unrest, Foreign Investment Is Again Interrupted

BY SARA HAMDAN, The New York Times

Ahmed Ali/Associated Press
Soldiers at the stock market in Cairo. As the Egyptian revolt unfolded, 13 Arab bourses lost nearly $50 billion in value in a week.
With the global markets on the mend last fall, a private equity consortium moved to sell its 93 percent stake in the Egyptian drug maker Amoun Pharmaceutical.

In January, the consortium of American investors, including a Citigroup fund, seemed hopeful they could sign a deal for $1 billion, more than triple what they paid in 2006.

But as student protests in the country turned to revolutionary upheaval, buyers never materialized. Now, the deal is up in the air, a person with knowledge of the situation told DealBook, speaking on the condition of anonymity.

After two years in a state of paralysis, foreign investors slowly began returning to the Middle East late last year, with deal volume showing a modest uptick. But in the wake of the uprisings in Egypt and Tunisia, deal makers in the region have once again grown cautious, concerned about economic instability and market volatility.
read more at http://nyti.ms/dQXfqk

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About Alexander Gordin
An international merchant banking professional with over twenty years of business operating and advisory experience in the areas of export finance, international project finance, risk mitigation and cross-border business development. Clients include foreign governments, municipalities and state enterprises as well as Fortune 500 and small/medium enterprises. Strong entrepreneurial instincts, combined with leadership and strategic skills. Transactional and negotiations experience in over thirty five countries. Author of the highly acclaimed "Fluent in Foreign Business" book and creator of the "Fluent in OPIC", "Fluent in EXIM","Fluent In Foreign Franchising", "Fluent in FCPA",and "Fluent in USTDA" seminar/webinar series. Currently developing "Fluent In ......" seminars and publications. Co-author of the Fi3 Country Business Appeal Indices. Extensive international business development and project finance transaction experience in healthcare, aerospace, ICT, conventional and alternative energy infrastructure, distribution and hospitality industries. Experience managing international public and private corporations. Co-Founded three companies abroad. Strong Emerging and Frontier Market expertise. Published and featured in numerous publications including: The Wall Street Journal, Knowledge@Wharton, NBC.com, The Chicago Tribune, Industry Week, Industry Today, Business Finance, Wharton Magazine Blog, NY Enterprise Report, Success magazine, Kyiv Post and on a number of radio and television programs including: Voice of America, CNBC, CNNfn, and Bloomberg. Frequent speaker on strategy, cross-border finance and international business development. Executive MBA from the Wharton School at the University of Pennsylvania. B.S. in Management of Information Systems from the Polytechnic Institute of NYU. Specialties Strategic Management Advisory, Export Finance, International Project Finance & Risk Management, Cross-border Negotiations, Structured Finance transactions, Senior Government and Corporate officials liason

2 Responses to Staying the Course. Taking a long view of Foreign Direct Investment

  1. Anton says:

    Thanks, that’s always interesting to get various views on the issue. I personally lost some money on oil price fluctuations… It’s been said those unrests were in part planned and inspired by some interested parties.

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