Country risk (RISK). A suitable economic and political environment promotes the good functioning of capital markets and helps them reach the aims of their implementation by establishing trust between investors and businessmen. It is expected that countries characterized by minor political and economic risks stand a good chance of having developed capital markets. As Larson and Kenny (1995) pointed out, a country’s political and economic environment is measured by the level of rick attributed to the country (Euromoney Country Risk Rankings) by the organization, Euromoney.