By analyzing the benefits and risks as well as the costs associated with investing into the Democratic Republic of Congo economy, it is evident that the company should not proceed to investing its foreign operations into DRC. This preposition was based on the high risk that will be accompanied when investing in Congo’s economy, a nation that suffers from a high rate of dept and a low GDP , along with the unstable economic surroundings due to the high rate of systemic corruption. Moreover
This recommendation was based on the substantial benefits associated with investing in a developed, industrialized nation such as having an advanced infrastructure in both the transportation and telecommunication industry. Along with a stable, democratic, capitalist political system, and as a member of the EU and WTO, France has a low level of corruption, a fair trade system and highly regulated safety standards and intellectual property rights. As the leading destination for FDI in the European Union, it is evident many other businesses have invested in Frances potential. Along with good demographics as a centralized country, France is one of the world’s top tourism destinations and the world’s second agricultural power. With many distinguished universities, France has a highly qualified, skilled workforce despite its regrettably high unemployment rate. Country’s Macro Environment
Democratic Republic of Congo is
is a highly developed country, has the third largest economy in Europe after France and Germany with an approximate GDP of $2.48 trillion US dollars.
. Its main trading partners are the USA, France, Brazil, Germany, Italy, Spain and Japan.
. In 2011, the total trade in goods was$10.66 billion .
France’s has a highly advanced infrastructure composed of a modernized transportation and telecommunication industry. There are over 84 canals which makes France one of the largest commercial waterways in Europe. Along with domestic and international airports, highways, roads, the French National Railway company, Train à Grande Vitesse, Eurotunnel’s, as well as extensive bike paths France has become a network of a range of transportation modes assessable throughout the whole country.
France foreign direct investment (FDI) rose by 22% in 2010 totaling approximately $57.4 billion. France has become more successful at attracting overseas companies than any other European country. France has become the fourth most attractive destination in the world. Due to investments made in 2010, 30,000 jobs were created and maintained in France.
France has relatively few large multinational companies despite its highly industrialized economy. France’s top three exporters are PSA, Renault, and Airbus Industrie. However, a lack of presence in emerging countries has resulted in loss of market share in the developing world.
As a member of the World Intellectual Property Organization, France has highly regulated product safety laws and, thus enforces strong privacy rights to protect intellectual property. As a result, France has a low level of corruption. Political Situation and Stability:
France is a democratic and capitalist nation. Their mixed economic system includes a range of private freedom that is combined with some government economic planning, strongly regulated industries and income redistribution. The government has privatized many large companies, banks and insurers and have sustained control in a large stake of economic activity. The government owns shares in many sectors, which include banking, energy production and distribution, automobiles, transportation, and telecommunications. Legislation:
DRC operates with civil legal system law based on Belgian version of a French civil law, but because of the low authority and the corrupted government none of these laws are actually being forced, being a member in the world...
Please join StudyMode to read the full document