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Corporate planners rarely incorporate political analysis into the planning process in the same systematic way that they include traditional business factors. Nevertheless, top management knows that politics can affect the bottom line. Reaching a delicate compromise solution within the corporation between labor and management, for example, can mean the difference between growth or decay. Influencing a trade association to adopt a helpful policy or to provide a valuable service to an individual corporation can create new business opportunities. Securing tax breaks from local or state governments or more liberal environmental regulations from the Federal Government can have a profound impact on business costs.

Led by authors Coplin and O'Leary, 85 teams of analysts chart the ebb and flow of political risk on the basis of these critical judgments about the year to come.

Firms with extractive businesses abroad dread political instability and sudden government switches in business agreements in the countries in which they operate. The take‐over of copper firms in Chile during the Allende administration in 1971 and the recent decision by Venezuela to reduce Reynolds Metals' equity share in a smelting operation from 50 percent to 28 percent are two examples of hundreds of such events that have determined the profitability of extractive operations over the past decade. Both the risks and opportunities for international firms seeking to produce and market raw materials or firms dependent on raw materials are heavily affected by political conditions.

Recent events have rewritten the political risk map, for the immediate future and perhaps for the 21st century. Regional issues are charted and key risk factors are scored for 86 countries.

Our Political and Economic Forecast Chart (an annual feature in Planning Review), highlights the risks and opportunities to international business as we see them from our perspective as editors of Political Risk Services (PRS) publications, and as the organizers of PRS semiannual conferences on political risk.

Corporate and strategic planners for international businesses have always been aware of the importance of domestic and foreign political conditions in defining both risks and opportunities for their businesses. Unfortunately, the complexity and subjectivity of political analysis, along with the lack of valid, relevant, and up‐to‐date information makes it very difficult to integrate political analysis into the planning process. Yet in recent years, the U.S. business environment has been radically altered time and again by international events such as changes in government, outbreaks of political turmoil, increasing or decreasing restrictions on the operations of international business, changes in protectionism, or basic shifts in fiscal and monetary policy. At the very least, planners need a warning system to alert them to possible serious reversals of the business climate.

Several times a year Planning Review publishes political risk analyses of major U.S. trading partners (see “Balancing Risk and Return in South Africa,” July 1983). Readers with businesses or clients in these countries will value the reports for the predictions they offer. However, the articles are even more useful as case studies of ongoing experimental analysis in which the working mechanism of a country—its key actors and decision structure—are dissected and evaluated. Planners can track current events on decision‐structure charts (see “Systematic Political Analysis for Planners,” November 1983) to update the predictions of the case study. Ultimately, history will tell us how successful this experimental method and analysis has been.

In the November 1983 issue of Planning Review, the authors suggested that corporate planners could benefit from systematic political analysis. Two of our readers accepted the challenge and applied the authors' model to a question of direct concern to them: Would the state of Florida repeal the unitary tax legislation it passed in June 1983?

China is second only to the Soviet Union and Canada in land area, but its mountains, steep hills, cold plateaus, and deserts greatly limit the amount of arable land. Most of China's natural resources either lie in the interior where no modern transportation is available, or are unexploited because of the lack of capital and technical capability. In recent years the official estimate of oil reserves, both inland and offshore, has been optimistic. Some believe that China's oil reserves almost equal Saudi Arabia's. However, recent explorations involving a number of Western companies in the South China Sea have fallen short of expectations.

President Mikhail S. Gorbachev's rise to power in the U.S.S.R. represents a transition from the old guard to the younger party leaders. However, his regime is based on a collective leadership that will undertake only modest reforms. There is little likelihood that either a more reformist or a more hard‐line regime will come to power in the next five years. No major opening to international business is likely, but some liberalization of imports may occur if domestic economic conditions improve.