Despite the risks, companies aren't turning isolationist. After falling during the financial crisis, foreign direct investment (FDI) in developing countries is growing again. The Multilateral Investment Guarantee Agency of the World Bank forecasts 20-percent FDI growth in 2011 and 13 percent in 2012, by which time inflows will reach $575bn. Much of the capital will target the growing middle-class economies in Russia, India and China, as well as natural-resource investments in sub-Saharan Africa, North Africa and the Middle East.

The problem is that some of the most politically risky countries offer the most enticing prospects. Russia is an example. In Transparency International's 2010 corruption-perceptions index, Russia ranked as one of the 20 worst countries for government commitment to accountability, transparency, and anti-corruption. But the country's private-sector boom is hard to ignore - gross domestic product is expected to grow 4.8 percent this year and 4.5 percent in 2012.

Brightpoint, a provider of supply-chain solutions to the wireless telecom industry, exited Russia during the financial crisis because its credit insurers pulled in-country coverage and, subsequently, customers couldn't get letters of credit, says Anthony Boor, Brightpoint's former CFO. But now that insurers are starting to go back, Boor, who left the company last month, says that Brightpoint "is looking at reentering."

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