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Royal Dutch Shell has been doing business in Nigeria since the 1920s, and has announced new plans to develop oil and gas projects there. However, over the years Shell has confronted a series of episodes involving country risk. Shells operations are centered in Nigerias Ogoni region, where the local citizens have protested Shells drilling and refining activities which are said to spoil the natural environment and reduce the amount of available farmland. Protestors also accuse shell of extracting wealth from the region without adequately compensating local residents. Ogonis sabotaged shells operations to such an extent that the firm suspended parts of its Nigerian operations. Shell also came under pressure to divest its Nigerian operations and to pay reparations to the locals. Despite these problems, Shell has persisted in Nigeria. Management instituted various community development programs in the region, budgeted at $50 Million per year. Design a framework to describe the various types of country risk that Shell appears to face in Nigeria. What proactive steps can Shell take to anticipate future country risk? What should Shell do to deal more effectively with country risk? What steps can Shell take to be a better corporate citizen in Nigeria? (Subject international business)

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