International Political Economy: Flags of Convenience and Political Risk

These flashcards cover key vocabulary terms and concepts related to international political economy, specifically focusing on flags of convenience, political risks, and the implications of sanctions.

Flags of Convenience

A practice where ships fly a flag of a different country than their home country to take advantage of less stringent regulations.

Political Risk

The risk of financial loss due to political changes or instability in a country where investments are made.

OFAC

The Office of Foreign Assets Control, a U.S. government agency that administers and enforces economic and trade sanctions based on US foreign policy and national security goals.

Sanctions

Economic and political penalties imposed by one or more countries against a targeted country, group, or individual.

Special Designated Nationals (SDN)

Individuals and entities designated by OFAC as being involved in terrorism, narcotics trafficking, or other activities contrary to the national security, foreign policy, or economy of the United States.

Foreign Direct Investment (FDI)

Investment made by a company or individual in one country in business interests in another country, in the form of establishing business operations or acquiring assets.

Race to the Bottom

A situation where companies or countries lower standards, often labor or environmental, to attract business or investment.

Economic Statecraft

The use of economic means to achieve foreign policy goals, often involving tools such as sanctions or trade agreements.

Multinational Corporation (MNC)

A corporation that has facilities and other assets in at least one country other than its home country.

Non-binding Standards

Guidelines or frameworks set by organizations that do not have legal standing but are intended to influence behavior and expectations.