Five high-risk countries for global operations
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Rapidly evolving labor laws
Escalating compliance costs
Operational disruptions
Significant financial penalties
The five riskiest countries
Risk level: Very high
Why companies operate here: World's second-largest economy with massive market opportunities, established manufacturing infrastructure, and strategic access to Asia-Pacific markets
Key compliance challenges:
- Foreign investment compliance deadlines: New requirements went into effect in December 2024 for organizational structure adjustments; noncompliance may result in suspension of all business operations.
- Escalating labor costs: Retirement age changes are increasing HR costs.
- Data transfer restrictions: Personal Information Protection Law (PIPL) requirements are in place for expensive local storage infrastructure.
- Geopolitical complexity: US-China tensions are creating ongoing sanctions compliance challenges.
Reality check: New stricter contract renewal requirements and termination procedures exist, with significantly higher penalties for noncompliance. Companies face fines for foreign employer noncompliance.
Risk level: Extreme
Why companies operate here: Large consumer markets, natural resource access, and skilled technical workforce in strategic locations
Key compliance challenges:
- International sanctions complexity: 17th EU sanctions package was adopted in May 2025, largely in response to the ongoing conflict Russia initiated with Ukraine.
- "Foreign Agent" requirements: Organizations face fines.
- Banking and payment restrictions: Risk of complete exclusion from USD-based financial systems exists.
- Legal system unpredictability: Arbitrary enforcement can affect standard business operations.
Reality check: Complete financial system exclusion is possible for sanctions noncompliance.
Risk level: Very high
Why companies operate here: Ultra-competitive labor costs, established textile supply chains, and large available workforce
Key compliance challenges:
- Workers' rights concerns: Bangladesh is listed among the top 10 worst countries for workers globally (ITUC 2025), indicating systematic violations of fundamental labor rights affecting all business operations.
- Massive compliance gaps expose international companies to risk.
- Enforcement inconsistencies: Systematic violations are common, with minimal government oversight.
- International scrutiny: New EU due diligence requirements in 2025 create additional pressure on companies with Bangladesh operations or supply chains to meet higher international standards for worker treatment.
Reality check: Reputational damage and supply chain audit failures are increasingly common.
Risk level: Very high
Why companies operate here: English proficiency, established Business Process Outsourcing (BPO) sector capabilities, competitive costs, and cultural alignment with Western business practices
Key compliance challenges:
- Workers' rights issues: The Philippines is ranked among the top 10 worst countries for workers globally (ITUC 2025).
- New foreign worker regulations: DOLE Order No. 248 (2025) introduces stricter compliance measures.
- Gig economy uncertainty: Pending legislation affects freelance and contractor relationships.
- Labor dispute exposure: Systematic issues create elevated penalty risks.
Reality check: Complex minimum wage requirements
Risk level: Very high
Why companies operate here: Strategic Europe-Asia bridge location, large domestic market, and skilled manufacturing workforce
Key compliance challenges:
- Turkish Labor Law No. 4857: A standard 45-hour work week with strict overtime regulations exists, and there are new revaluation rate adjustments for 2025. Termination procedures require significant notice periods and severance.
- Economic instability: High inflation and currency volatility affecting employment contracts, wage calculations, compensation planning, and operational cost predictability exists for international companies.
- Political risks and increasing authoritarianism: The proposed criminalization of protests and strikes affecting civil liberties can impact business operations.
- New safety requirements: Mandatory employment of safety specialists was required by January 2025, creating significant compliance costs and liability exposure for all employers.
Reality check: New workplace safety compliance requirements are creating significant cost obligations.
Comprehensive support for established operations
If you're already established in these markets with significant operations, you don't have to go it alone. Many organizations have the business case to stay, but lack the specialized expertise to navigate complex local requirements effectively.
Our comprehensive approach leverages our 400+ in-country experts to handle the regulatory complexities you shouldn't have to manage internally. You gain access to local specialists who understand both statutory requirements and cultural expectations; from navigating foreign investment compliance and evolving labor laws to managing benefits administration and employment contracts that meet local standards. Our experts handle the operational details that directly address the risks in these challenging markets — staying current with local tax and finance regulations, managing escalating labor costs, and ensuring HR policies comply with changing worker protection standards, helping you reduce risk exposure without disrupting successful operations.
Strategic workforce optimization for new opportunities
Whether you're looking to hire new talent or relocate existing team members, Employer of Record services enable you to access lower-risk markets without the barriers of entity establishment.
With 17+ years of experience across 187+ countries, we help you identify optimal locations for your specific roles — balancing talent availability, cost considerations, and regulatory stability. Rather than accepting escalating compliance burdens in high-risk markets, you can establish operations in strategic markets quickly and compliantly, with no entity required. Our experts guide you through the transition, ensuring you maintain operational effectiveness while reducing exposure to the regulatory complexities that create challenges in high-risk countries.
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