HISTORY AND GEOGRAPHY: The Foundations of Cultural Understanding Chapter 3

HISTORICAL PERSPECTIVE IN GLOBAL BUSINESS Understanding a country’s history is critical in gaining knowledge of the culture. History is subjective Examples: Crossing Borders 3.1 pg. 59 How the U.S. and Mexico define their relationship Manifest Destiny and the Monroe Doctrine

GEOGRAPHY AND GLOBAL MARKETING Effects that Climate & Topography have on International Marketing: Need to understand the effects that geography has on countries’ ability to supply needs, transport products, and impact the economy Good example: Crossing Borders 3.4 pg. 66 “Drinking Fog”

GEOGRAPHY AND GLOBAL MARKETING Effects that Climate & Topography have on International Marketing: Physical barriers effect the country’s economic growth and ability to trade How countries overcome these natural abilities can mean the difference between a prosperous economy and one that is not (access to markets, lower distribution costs, lower production costs…) Industrialized nations are better able to overcome geographic obstacles vs. underdeveloped, less prosperous economies United States vs. South America (jungles, mountains)

GEOGRAPHY AND GLOBAL MARKETING Examples of countries that were able to overcome their geographical limitations Channel Tunnel English channel between Britain and France Oresund Link in Europe Sweden/Denmark built bridge and tunnel across the Baltic Strait to Continental Europe Colonia Bridge Bridge between Argentina and Uruguay

Geography, Nature and Economic Growth Less-privileged countries suffer disproportionately from natural disasters over more economically stable countries In more prosperous countries, the ability to prepare, plan and overcome natural disasters is much greater Have resources (money and better technology) to detect natural disasters and adapt to uncontrolled environmental situations

Social Responsibility and Environmental Management Environmental protection is no longer a buzz word, but rather a necessity and is an increasingly important part of doing business Maintaining economic growth while balancing the protection of the environment has become a major concern for businesses worldwide

Social Responsibility and Environmental Management Organizations that have formed to address this problem include: The Organization for Cooperation & Development The United Nations The European Union Other international activist groups Many organizations and governmental agencies are governed by a concept called “sustainable development” Seek economic growth with “wise resource management, equitable distribution of benefits and reduction of negative efforts on people and environment…” Crossing Borders 3.6 pg. 70 – “Garbage without a country”

Resources The availability of natural resources has in impact on economic growth Petroleum is one of the most import resources that nations need to supply energy, power, transportation… Most countries are not self-sufficient, this becomes one of the most important imports and has a major impact on a country’s trade deficit or surplus. Global interdependence of energy resources is increasingly important and has incredible political power See World Energy Consumption - Exhibit 3.3 pg. 72

World Population Trends Consider the growth and decline of populations throughout the world and the effect it has on supply and demand of products and services Population increasing in under-developed countries vs. population decreasing in developed countries Consider the effect an aging population has on a country’s economy and ability to provide for older generations Japan example

World Population Trends Population Control Moral issue, political issue, or economic issue? Prerequisites to population control include: Adequate incomes, higher literacy levels, education for women, universal access to health care, family planning, improved nutrition, and most critical a change in cultural beliefs and values

Worker Shortage & Immigration A balance is needed between countries that are facing explosive populations (less-developed countries) and worker shortages that will face declining population growth areas (developed countries) Consider Mexico and the U.S. What opportunities and challenges will both face with immigrants coming to the U.S. from Mexico?

World Trade Routes & Communication Links Developed to overcome economic challenges and imbalances created by the geography of the country Communication Links The method by which countries use communication channels to facilitate trade Telephone, satellites, computer, internet