When were talking about trade, you’ll probably hear the words “investments”, “portfolios”, “capital”, “debit and credit”, and BOP (thats balance of payments). These words to global trade advisors and financial aficionados are like second nature, but to those just breaking into the world of International Business, they can be daunting words. Let’s use an example that will give you a visual picture of just how everything comes together to understand how countries measure international business activity, balance payments, and look at exchange rates and altered trade prices.
When it comes to business, there is more than one important facet to creating a successful and productive company. Most importantly, is the part culture plays. Think about it. Culture, defined, is an integrated system of learned behavior patterns that are characteristic of the members of any given society, and culture is thus shared through various groups of shared interests. Essentially, it’s the things people share together; language, social cues, behaviors, religions, and even various attitudes and manners that are accepted. In order to produce a successful business globally, you must learn these special aspects of culture, otherwise, you risk not only embarrassing yourself, but loosing an important deal.
Why should we worry about misaligned participations in trade? According to the U.S. Department of Commerce, less than 1 percent of U.S. firms export. Tens of thousands of small-business manufacturers and service sector firms could export their goods and services, but do not. These companies often fear the challenges of going overseas. But all firms entering new markets face shortcomings and disadvantages when compared to local competitors. Due to a lack of local knowledge, unfamiliarity with market conditions, insufficient insights into consumer behavior, and newness to political decision making, all new entrants encounter a “burden of foreignness.” Policymakers need to help prospective exporters overcome this burden and successfully access new opportunities overseas.
Spring Break 2016 is around the corner. While you are packing up swimsuits and heading for somewhere warm, we are here to offer you some thoughts of islands and beauty. If you are planning to get some readings done by the beach, this review of trade policy in Fiji 2016 is waiting for you to pick up and read.