Support for scientific research and technological development, especially in developing countries, requires interstate and cross-border participation. Such development and technology transfer issues are subject not only to ethical evaluations but also to political risk assessments. The degree to which international investment projects, public and private, are attracted to or successful in many parts of the world is increasingly dependent not simply on technical but on social and political factors.

It has been argued that any engineering project worth $100 million or more is no longer a technical project, but a political enterprise. All political enterprises embody risks. Political risk—also known as country risk or sovereign risk—is most often defined as those conditions that a country can create at home that might undermine investment climate and cause investors to incur losses. Political risk also involves exposing a business to conditions abroad created by extra-...