The political stability of a foreign country into which a company is exporting is of the utmost importance. Exporters must be constantly aware of the policies of foreign governments in order that they can change their marketing tactics accordingly and take the necessary steps to prevent loss of business and investment.

Instability in the target market could lead to losses resulting from war, civil strife and political instability. It is essential to warn exporters to be aware of government intervention in the target market. Most countries world-wide operate under a capitalist system within which the volumes and values of goods and services whether provided locally or by way of imports, are set by the forces of supply and demand.

There are, however, still a number of countries in which the government plays an interventionist role. Examples of such economies include North Korea, Cuba and Vietnam. In certain other countries, partial liberalisation of trade has been achieved but the extent of this liberalisation still has to be investigated by any exporter wishing to enter these markets.

Furthermore, while there are certain countries that appear to have advanced towards a more open market, there may be constraints upon their foreign currency reserves. In such countries the Reserve or Central bank of that country may not have enough foreign exchange to allow payments to progress thereby again resulting in the risk of non-payment for the exporter.