The major risks facing ROMDATA include:

Risk factor #1:   Currency conversion delays and exchange rate fluctuations.

The Carpassian currency is unstable.  To avoid currency fluctuation exposure, ROMDATA will invoice Convergence International in U.S. dollars.  Conversion will be CI’s responsibility, but ROMDATA will still face currency risk because it will be difficult for Convergence to easily convert the Carpassian currency to dollars.

Risk factor #2:   Political Instability/Nationalism.

The newly elected Carpassian government is also unstable.  There are nationalist factions throughout the country trying to wrestle power from the government.  In addition, Communism still has widespread support since the transition to a market economy has been tumultuous.  Poverty has increased and inflation is skyrocketing.  There is also a lack of available consumer goods.  The new government must act quickly to build grassroots support and avoid a reactionary backlash.  

Risk factor #3:   Reduced sales due to depressed demand, price slides, or	economic downturn.

All three of these scenarios are risks faced by any business, but they are more pronounced in Carpassia as well as in any other newly formed Eastern European democracy.  The economic cycles will be more severe in the Carpassian economy because of its infancy.  This will affect the level of demand and pricing which will directly affect ROMDATA’s sales.