It is always the best course of action to divest a foreign project if the expected cash flows from the project decline substantially.

Question

Quizplus · Accepted Answer

Divesting a foreign project solely based on a substantial decline in expected cash flows might not always be the best course of action. Companies should consider other factors such as the strategic importance of the project, potential for future recovery, tax implications, and the impact on relationships with local stakeholders and governments. A comprehensive analysis might reveal that adjusting the strategy, renegotiating contracts, or waiting for market conditions to improve could be more beneficial in the long term.

It Is Always the Best Course of Action to Divest