INTERNATIONAL
MARKETING IN POLITIC’S ENVIRONMENT
By: Muhammad FR, Tris,
Fitri, dan Diar
Global
Perspective
There is no company,
domestic or international, large or small, can do business without considering
the influence of the political environment in which it operates. The host
government and the country of origin is an integral partner. The Government
will respond to the problems that arise in international marketing.
International law
recognizes the sovereign right of a nation to give or not permission to do
business within the political boundaries, and to control where citizens do
business. Independent and sovereign state free from all external control,
1. Have
full legal equality to other countries.
2. Territorial
govern themselves.
3. Choosing
the political system, economic, and social itself.
4. Have
the power to hold a treaty with another country.
Sovereignty
of Nations
In the context of international law, an independent
and sovereign state free from external control, has full legal equality to
other countries, govern its own territory, choose a system of political,
social, economic itself, and have the power to have an agreement with the
countries other.
Sovereignty with regard to the strength of a country
in relation to other countries and held supreme power over its own citizens. A
state sets the requirements for citizenship, determining geographic boundaries,
and to control trade and movement of people and goods across its borders....
Stability
of Government Policies
The ideal political
climate for a multinational company is a stable and friendly government .
Because foreign businesses are judged by standards as varied as the nations ,
stability , and hospitality administration in every country should be
considered as a sustainable business practice .
If there are potential
benefits and if allowed to operate in a country , multinational companies can
function under the condition that any kind of stability and the ability to
predict the long term .
There
are five causes of political instability in international markets :
1. Some
form of government appears to be unstable
2. Changes
in the political parties during elections may have a major impact on trading
conditions
3. Nationalism
4. Hostility
directed against certain countries
5. Trade
dispute itself.
Forms
of Government
·
Afghanistan, Republic of Islamic
·
Republic of Belarus, although in fact a dictatorship
·
Bosnia and Herzegovina , Republic of
emerging federal democratic
·
Myanmar, Military’s of Junta
·
Canadian, Confederation with parliamentary
democracy
·
Chinese,The Communist of Countries
·
Republic Democratic of Congo, The
Dictator of Government, presumably undergoing a transition to representative
government
·
Cuban, The Communist of Countries
·
Republic of Iranian, terocratis
·
Libyan Jamahiriya, in theory governed by
the population through local councils in fact a military dictatorship
·
North Korean, The communist country
·
Saudi Arabia, Monarchy of Countries
·
Somalia, No permanent national
government, parliamentary federal government transition
·
Sudan, authoritarian regime-ruling military’s junta
·
British, Constitutional of Monarchy
·
United States, Republic of Federal Constitutional
·
Republic of Uzbekistan, an authoritarian
presidential rule, with little power outside the executive branch
·
Vietnamese, The Communist Countries
Political
Parties
An astute marketer must
understand all aspects of the political terrain in order always to know all too
well regarding the political environment information. Substitution
unpredictable and drastic government policies will deter investment, whatever
is causing the turnover.
So, an assessment of
philosophy and political attitudes in a country is important to measure the
stability and attractiveness of a government in relation to the potential
market.
Nationalism
Nationalism is an
intense feeling of pride and national unity, an awareness of the population of
a nation's self-esteem to their country.
The main objective of
economic nationalism, which is to protect the national economy in which
autonomous population identifies its interests with the protection of the
sovereignty of the country in which they live.
The
fear or Directed of Resentment
It is important for
marketers in order not to confuse nationalism, where the hatred is directed
generally to all foreign countries, with widespread fear or hatred directed at
certain countries.
It is important to
realize that there are no nations, however powerful, is aan tolerate
penetration by a foreign company in the market and the economy, if it is
perceived as a threat to the social, cultural, economic, or political for her
welfare.
Political
Risks from the Global Business
Sovereignty issues,
different political philosophies, and nationalism manifested in a large
governmental actions that increase global business. Risk of foreclosure can be
shaped, most rugged, until the many rules and regulations that the government
is more lenient but still significant, such as trade controls, import
restrictions, and price controls that directly affect the performance of the
business activity.
Of all the political
risk, which is the most harmful actions that result in the transfer of equity
of the company to the government, with or without adequate compensation.
Assessing
Political Vulnerability
At least a lot of
reasons for a company's political vulnerability as numerous political
philosophy , economic variations , and cultural differences . Some companies
seem to be more politically vulnerable than others , so that they receive
special attention from the government .
Unfortunately , a
marketer does not have an absolute guide to be followed to determine whether a
company and its products will be the subject of political attention . Countries
that seek investments in high- priority industrial companies may be exempt from
taxes, duties , quotas , exchange controls , and other investment barriers .
Examples of cases
associated with this is a joint effort to make the Continental Can Company cans
for the Chinese market face a barrage of restrictions when the Chinese economy
weakened . China establishes that beverage cans is waste , and should be banned
from all party and state banquets . Tax rates of aluminum and other materials ,
which are imported to produce cans , double, and implemented a new tax on the
consumption of canned beverages . For Continental Can , a potentially
profitable investment , made unprofitable by the change in the attitude of
the Chinese government after a few years .
Government
Encouragement
The government , both
foreign and U.S. , as well as preventing encourage foreign investment . In fact
, in the same country some foreign businesses could be targeted politically
fueled , while others housed within the government with the protection and
preferential treatment . The difference lies in the evaluation of a company's
contribution to the nation's interests .
The most important
reason to encourage investment is to accelerate economic development . The more
the State is encouraging foreign investment with a particular guide
goal-directed economy . Multinational corporations can be expected to create
local employment , transfer of technology , generate export sales , stimulate
the growth and development of local industry , keeping stock exchange , or meet
all these expectations as a condition of market concessions .
The U.S. government is
trying to create favorable conditions for foreign businesses , by providing
guidance that helps minimize the financial risk is more difficult politically .
