15-4 Sovereign country risk is largely independent of the credit standing of the foreign borrower.

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Sovereign country risk refers to the risk of changes in a country's political or economic environment affecting the ability of foreign borrowers to repay their debts. This risk is largely independent of the credit standing of the foreign borrower, as it is focused on the overall stability and creditworthiness of the country itself. Even if the borrower has a strong credit rating, they may still face difficulties if the country they are based in experiences political instability, economic downturns, or other negative events.

15-4 Sovereign Country Risk Is Largely Independent of the Credit