Look at the following infographics Think pair share: Which country would be attractive and why?

Assessment of country markets Topic 3 How does a company decide which countries to target?

Learning Objectives by the end of this lesson students at …. Will be able to evaluate why certain factors attract a business to a country Evaluation ~ GCE Grade A* Will be able to propose countries that are attractive to businesses Synthesis~ GCE Grade A Will be able to analyse the factors that attract a business to a country Analysis ~ GCE Grade B Will be able to demonstrate understanding by using examples/cases Application ~ GCE Grade C Will be able to explain the attractiveness of some countries Comprehension ~ GCE Grade D Will be able to recall factors that make countries attractive Knowledge ~ GCE Grade E 10 1

Success Criteria

Assessment of country markets Size, economic growth and wealth are not the only important criteria There are many important questions that must be researched

How well-developed is the country? Human Development Index – useful as it ranks countries in relation to several aspects of development It provides a measurement based on: Health care (life expectancy) Education (adult literacy rates, %ages of age groups enrolled in school) National income (measured by GDP per capita)

Human Development Index 2 mins Human Development Index On your whiteboard write down: Why do you think these issues will help decide on investing in that country? Think pair share Extension Task: Any negative side to using this index as a measure?

How well-developed is the country? A workforce with limited education and poor health care will not be attractive to potential employers If small number of rich people and many poor people, it limits the markets for their products

How stable is the government? Political instability can make some markets very unattractive There is a trade off between risk and profitability Businesses seek to develop relationships with politicians in order to reduce the risks

Is there a legal framework that will protect businesses? Sometimes in place but not always Some emerging economies have laws that enable businesses to go through courts to collect bad debts Some economies, the legal system is slow E.g. China does not have a reliable legal system, there are issues with counterfeiting products

Are there problematic government policies? Government controls can be a problem for foreign businesses. The following need to be considered: How much tax will the business have to pay? Level and way collected can be different Are there significant barriers to trade? Some governments tax imports and restrict quantities How difficult is it to start up a business? Bureaucratic controls can be time consuming How favourable is the exchange rate? Undervalued exchange rate can be a problem with competition Will there be government grants or subsidies available? In the EU, these are regulated to ensure fairness

Cultural and media issues Businesses need to understand local cultures More is known now about how to adapt to host countries’ expectations Learn from other businesses mistakes

The Labour market How easy is it to recruit labour with appropriate skills for the technologies that will be used A budget for training programmes will need to be considered Trade offs considered between paying low wages and recruiting people with human capital

Corporate Policy Businesses are different in the extent to which they want to expand abroad Some want to expand to diversify to reduce risk Some businesses are addicted to growth (Tesco) Some expand to find new sources of resources (mining) Lower costs abroad for production Progress Arrow

Task

Watch the video China, India and the rest of the developing world will eclipse the west in a dramatic shift in the balance of economic power over the next 50 years, according to research by the Organisation for Economic Co-operation and Development (OECD). www.guardian.co.uk/global- development/datablog/2012/nov/09/developing-economies-overtake-west- 2050-oecd-forecasts

GDP growth across OECD GDP growth for OECD countries predicted to 2050: how the rankings change

Corporate Policy Which countries would you target Why? Use Diamond 9 to rank in order Which to target 1st at top   1 2 3 4 5 6 7 8 9

Lesson Keywords Corporate policy The labour market Political stability Human Development Index

Assessment of country markets Exit pass On your cards Topic 3: Assessment of country markets Write down: 2 or more things you found easy to understand/ remember from the lesson What did you find difficult to understand

Learning Objectives by the end of this lesson students at …. Evaluation ~ GCE Grade A* Will be able to evaluate why certain factors attract a business to a country GCE Grade A Synthesis~ Will be able to propose countries that are attractive to businesses GCE Grade B Analysis ~ Will be able to analyse the factors that attract a business to a country GCE Grade C Application ~ Will be able to demonstrate understanding by using examples/cases Comprehension ~ GCE Grade D Will be able to explain the attractiveness of some countries GCE Grade E Knowledge ~ Will be able to recall factors that make countries attractive 10 1

Success Criteria 