Deals on the Edge: How Political Uncertainty Shapes Cross-Border Transactions

Cross-border Deal-making

When Politics Meets the Bottom Line

In today’s global economy, cross-border deal-making is essential for growth. But political uncertainty—from regulatory swings to electoral shocks—can send investors running and raise the stakes for companies looking to scale across borders.

As CEO of Intermestic Partners, an international advisory firm I founded in 2011, I’ve seen how political volatility can derail billion-dollar investments. My experience—from serving as a border-city mayor in Arizona to leading cross-border policy at U.S. Customs and Border Protection—taught me that political stability isn’t a luxury; it’s a dealmaker’s lifeline.

The Real Costs of Political Uncertainty

Political instability drives risk premiums sky-high. M&A deals stall. Regulatory hurdles multiply. And investors hedge, or walk.

• Higher transaction costs stem from delays, compliance gaps, and legal ambiguities.

• Currency fluctuations inflate deal values, especially when foreign capital flees uncertain markets.

• Borrowing becomes costlier, as lenders raise interest rates to cover exposure.

A 2023 UNCTAD study found political risk now ranks above inflation and supply chains as the #1 reason cross-border deals collapse.

Strategies That Work

• Comprehensive due diligence to forecast political shifts

• Local partnerships to navigate bureaucracy and build trust

• Political risk insurance for major exposures

• AI and big data analytics to predict and adapt to evolving political environments

The Future Is Adaptive

Cross-border deals won’t stop. But how we execute them must evolve. With tailored insights and regional fluency, firms that adapt will thrive—even in turbulent times.

At Intermestic Partners, we specialize in helping global companies de-risk political environments and close confidently. If your business is eyeing cross-border growth, let’s talk. The right strategy can turn uncertainty into opportunity.

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www.intermestic.com

Founded in 2011. Built for bold moves across borders.