Mgx 5310 Assignment 1

Topics: Risk, Globalization, Political risk Pages: 7 (2141 words) Published: August 22, 2013
MGX 5310 Assignment 1

Question 1:
If you wanted to conduct business in an emerging country such as Brazil or a less developed country like Kenya or Bangladesh, what are the political issues you might face?

Political Risk in International Trade
Outline:
I. INTRODUCTION
II. POLITICAL ASPECTS RELATED TO BRAZIL
i. Government Outlook
ii. Political Protests
iii. Police Brutality and Gang Violence
iv. Macro-economic Risk Factors

III. POLITICAL ASPECTS RELATED TO BANGLADESHI
i. Government Outlook
ii. Ethnic Tensions
iii. Corruption
iv. Macro-economic Risk Factors

IV. COMPARISON OF POLITICAL RISK BETWEEN BRAZIL AND BANGLADESHI i. Political Differences
ii. Economic Prospects
iii. Legal and Regulatory Environment

V. HOW TO OVERCOME POLITICAL RISKS
i. Negotiated Agreements/Interactive/Protective Techniques ii. Development of Long-term Strategies
iii. Use of Personal Relationships
iv. Proactive Strategies

VI. CONCLUSION

Introduction
The world of business is becoming overcrowded every day, and companies have to develop strategies on a global basis. Political, legal, cultural and economic circumstances vary significantly around the world. Even though investing in an international market may require intensive capital, the reward of such a business may be enormous. The sale of products and services in another country enables the company to increase its sales, expand the products life cycle, improve brand recognition, and reduce the risks of operating in a single market (Hill, 2009). Before choosing a foreign country for business, numerous aspects have to be considered. For instance, one must consider the nature of politics in that country as well as the political risks involved. Political risks entail the hazardous impacts that political events or decisions may have on a business. Such risks range from corruption, tax laws, and protests to wars. To manage these risks, companies must carry out comprehensive research beforehand. Some countries may be extremely conservatives while others may be easy to do business (Harrison, 2009). This paper will examine the political aspects affecting entry into an emerging country in comparison to entry into a less developed country. Special attention will be given to Brazil and Bangladesh.

Political Aspects Related to Brazil
There are different political systems in Brazil that are likely to affect business. To certain extent, these risks subject the country’s investors and their investment at stake. An examination of Brazil’s political environment indicates that Brazil is a federal republic made up of 26 states and a capital district. It has a dynamic multi-party system of government with twenty parties represented within its congress, this is to suggest that it is a democratic state. The quality and effectiveness of the government services and infrastructure are continuously being improved by the government (Jeffrey, 2011). Despite the massive improvements that have been witnessed in Brazil, the country still grapples with corruption related risks that may hinder business. These cases were most prevalent during the reign of the former president Luiz Inacio “Lula” Da Silva. After taking office in 2002, the president was instrumental in improving the country’s poor economic condition. However, scandals tainted his presidency especially in 2007 when it was discovered that government officials were participating in trade of municipal properties. Political protests are a common sight in the streets of key cities in Brazil. This is usually done by local groupings pushing for certain agendas to be addressed by the government. Such protests can represent a risk to the daily operation of business because of the protestors’ tendency to involve violence, looting and destruction of...

References: Adler, N. (2008). International Dimensions of Organizational Behavior. Mason. Thomson Southwestern
Cullen, J
David, M. (2007) International Franchising. Pine Forge Press, California
Derek, H
Gupta, V. (2006). Culture, Leadership, and Organizations. Thousand Oaks. Sage Press
Jeffrey, S
Harrison, L. (2009). Political Risk Management. New York, McGraw Hill
Harrison, L
Hofstede, G. (2007). International Differences in Work-Related Values, London, Sage.
Tychy, K. (2010). Globalizing Management. New York: Wiley
Székely, M
Peabody, D. (2005) National Characteristics, Cambridge. Cambridge University Press.
Schein, H. (2004) Organizational Culture and Leadership. San Francisco, José-Bass Publishers
Theodore, H
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Assignment 1 Becoming an effective Leader Essay
  • HLTA Assignment 1 Essay
  • assignment brief unit 1 Essay
  • Essay on unit 1 assignment 1
  • Essay on assignment
  • assignment 1 Essay
  • assignment--1 Essay
  • Assignment 1 Research Paper

Become a StudyMode Member

Sign Up - It's Free