Socio and Economic Factors in Global Business Essay -- GCSE Business M

Socio and Economic Factors in Global BusinessWhen a high society decides to take their ancestry world-wide, thither ar many different sociological and stinting factors that they need to take into account. There are differences in worry styles, international laws and treaties that regulate international business, as fountainhead as ethnical customs that come into play. Each of these are signifi endt and needs to be taken into account in order to minimize likely problems. umpteen times, lack of knowledge can create serious problems. Although there are a myriad of socio- and economic factors, this paper go out focus on three key ones 1) political barriers 2) labor practices and 3) cultural barriers. Additionally, real sphere examples provide be offered on how some businesses chip in successfully chastise these barriers.Political BarriersFor purposes of this discussion, political barriers refer to the geo-political situation of a country, as well legal barriers such as ta riffs, taxes, etc. Countries set up barriers to foreign entities conducting business within their borders (especially imports and exports) for several reasons. Duties and taxes can create some governance revenue. If there is a high tariff then there will be less exporting, therefore more of that product in the country, so making the price of that product in the country lower since there will be a greater supply. So trade barriers can be helpful to a country. On the contrary, trade barriers can have a negative effect on a country as well. Consumers will have to pay a higher price on imports, and for similar products produced in the country the price will rise repayable to consumers buying the imported products. In order to regulate the barriers on international trade, there have been organizations formed. GATT (General Agreement on Tariffs and Trade), WTO (World Trade Organization) and NAFTA (North American uncaring Trade Agreement) are just a few examples (Czinkota, 1999). Other considerations in overcoming political barriers are the governments themselves. Conducting business in Cuba is virtually impossible for American companies probably until the fall of the Castro regime. Domestic and international pressure on benignant rights, governments considered to be corrupt or illegal may also chemical bond an organizations ability to do business in received regions of the globe. Although these factors... ...zed crime, etc (Fortune Small Business, 2000).Conclusion This discussion has highlighted but a few socio- and economic factors that must be considered when deciding to conduct business in a foreign country. As one can demise, the risks are there, but the potential for profit is very alluring. With prior proper planning, the risks can be limited. However, it will serve businesses well to incorporate economic factors into their overall global business strategies.References Czinkota, M., Ronkeinen, I., Moffett, M. (1999) International Business. Fort Worth The Dryden Press DSN Retailing Today (2001, June 5). have trade in billion-man market creates empire of opportunity.Economist (1997, June 21). 99% perspiration. Vol. 43, get out 8022. Fortune Small Business (2000, April). East meets Mex. Hofstede, G. (1984). Cultures Consequences. Beverly Hills, Ca Sage Publications. Orange County Business Journal (2001, April 23). OC companies do business in China over tea, gestures. Winter, D. (May 2000). Facing globalization. Wards Auto World. Vol. 36, publish 5. (www.doc.gov) (www.opic.gov) (www.usatrade.gov)