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Risk Management

International trade adds to or increases some risks compared to domestic trade.

These are some of the additional risks you need to know of and to manage:

  • Customer risk or commercial risk is not only the risk that the supplier is not financially able to deliver as agreed but can also include his will to deliver as agreed.
  • Country risk or political risk includes for instance the risk of war, civil riots, acts of God and changes in trade regulations etc.
  • Foreign exchange risk arises when you are invoiced in a currency in which you do not have an income and consequently are forced to buy the needed currency at the time of payment.
  • Other risks could be for instance the transportation of the goods and/or interest rate fluctuations.

See also