How to value a WHOLE country

January 16, 2025

It’s been done before!

I don’t think it would be that hard to value an internationally strategic infrastructure asset such as canal.  We could look at the income streams from the fees paid by the boats and ships using it and the costs of maintaining and repairing it, especially if the original capital expenditure had long ago been depreciated.  In putting the numbers into a DCF in our valuation tool would pop out the initial answer in a minute or two and then we could get to work on the enhancements and impairments (route of choice for ship owners vs costs of maintaining an army to protect the asset).

When it comes to valuing a WHOLE country it would take us a bit longer – naturally! But it can be done.  We would need some other experts to help – chartered surveyors to value the property assets and geological surveyors to value the mineral assets and some IP experts to help us uncover  all the registered and unregistered intellectual property. There would be some tricky analysis to work out what was been bought/sold.  The citizens’ personal assets would have to be identified and excluded for example.  Valuing the strategic importance of the country to the buyer could involve both economic and military analysis so I can see how more experts would need to be available to give an expert opinion.   The long term costs of owning it would also be an interesting and necessary piece of analysis. Will the new owner of the country be responsible for paying for the citizens’ healthcare?

It won’t be a surprise to you that there are precedent transactions which would be useful to consider, albeit with significant adjustments for inflation because it has been quite a while since one country bought another.

Perhaps the best precedent would be the Louisiana Purchase in 1803 – which cost the US15m for 828k square miles.   That’s $419m in today’s money.

But there are more to choose from (thank you Wikipedia!)

I don’t think somehow that our standard five-day service would cut it, do you?

Whilst we wait a call from someone important to hire us (!), we are always available for valuation work from our wonderful legal friends and associates.  Do email or call us anything with questions or requests for help.