INTClintmodulethree

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INT 220

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Jan 9, 2024

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INT 220 Module Three Assignment Template Economic and Political Environments Comparison Clinton Simmons Section One Initial Thoughts Initially, I feel that the political system doesn’t have a lot of bearing on those who are making business decisions and will be the least detailed of the sections. The economic classification will be very important to those are making business decisions involving one of those countries. The economic classification will tell a lot about how developed a country is and how the citizens there are able/willing to spend their money, as well as how much money they’re typically making. Economic blocs that impact trade is important also. Trade is critical for a country’s economy. How that economy works with other countries is a valuable piece of information for the CEO or manager of a firm considering expanding their operations into that region. It will also give a lot of insight into the types of products and services that are in demand there and whether their industry would be a profitable one. GDP and GDP per capita seemed like pretty much the same thing to me, they are both telling a general idea of how much money the country brings in each year from products made domestically. This is important because it will tell me about their growth and potential for future growth, and how busy their economy is. GDP tells us about output, but GDP per capita takes it one step further, telling us about output per person, a better measure of productivity. And finally, I wasn’t initially sure what the purchasing power parity is or what it meant initially so I had to do a little research before I could form an opinion. That research revealed to me that its basically a measure of a country’s absolute purchasing power based on a uniform standard “currency.” Purchasing power also didn’t feel as important to business decisions as is economic class, GDP, and trade factors, so I assumed it may tell us a little about whether we would want to introduce a new product there or expand operations into the country, but the data wouldn’t be weighed as heavily as other factors.

Section Two Insight For Business Professionals Category Mexico Germany Turkey Political System Provides insight into how the people of the country select their political figures and how closely those figures interact and/or intervene in the economy as well as what sorts of policies are important to them. Countries with political instability are less attractive to investors. And countries that are politically stable tend to thrive in the international business market. *Federal Presidential Representative Democratic Republic. *Under the transition to democratic pluralism, the center of political power has shifted away from the executive and towards the legislative branch and local governments. (RBC, 2023) *Trade policy and international relations have hurt the economy in the past, but the new administration says economic stability is a priority. (Ramirez, 2021) *First Latin American country to sign an economic partnership, political coordination, and cooperation agreement. (Ramirez, 2021) *Closely tied to the EU. (Ramirez, 2021) *Government regulates economic activity. (ITA, 2022) *Bicameral parliamentary system. (Sawe, 2017) *Composed of two “houses” with a president as a ceremonial figurehead and an elected chancellor who is in charge. There is also a judicial branch. *Democratic, federal parliamentary republic. (Sawe, 2017) *Has a constitution emphasizing the protection of individual liberties. (Sawe, 2017) *Government closely regulates economic activity. *Presidential republic, governed by the separation of powers. *Corruption is difficult to stop. *Unitary state. *Member of NATO. (Chepkemoi, 2017) *State has heavy presence in the market and economy. (Chepkemoi, 2017)

Category Mexico Germany Turkey Economic Classification *Mixed market economy with both private and state- owned businesses. (Pariona, 2019) *Ranks 43/82 globally, or a score of 6.36/10, on the business ranking model by the Economist Intelligence. (EIU, 2023) *Major U.S. trading partner. (RBC, 2023) *14 th largest nominal GDP in world. (RBC, 2023) *Mixed market economy of both socialism and capitalism. (Heritage Foundation, 2023) *4 th largest economy in the world. (Sawe, 2017). *Ranks 7/82 globally, or a score of 8.22/10, on the business ranking model by the Economist Intelligence. (EIU, 2023) *The United States’ largest European trading partner. (ITA, 2022) *”“Social market” economy largely follows market principles, but with a considerable degree of government regulation and wide- ranging social welfare programs.” (ITA, 2022) *Ranks 57/82 globally on the business ranking model by the Economist Intelligence, or a score of 6.02/10. (EIU, 2023) *19 th largest economy in the world. (Heritage Foundation, 2023) *Upper middle income largely mixed market and diversifying, emerging economy; dynamically developing. (Heritage Foundation, 2023) *Monetary stability remains fragile, and inflation remains high. (Heritage Foundation, 2023)

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Category Mexico Germany Turkey Economic Blocs Impacting Trade *USMCA (replaced NAFTA in 2020) *WTO *OECD *APEC *G-20 *Pacific Alliance *13 FTAs with 50 countries (ITA, 2022) *Part of the EU, the most significant trading bloc in Europe with 27 member states. *WTO *EEA (Li Cain, 2021) *38 Free Trade Agreements, 11 of which were replaced with the EU, however. (ITA, 2022) *Remaining blocs are: EFTA, Israel, Macedonia, Bosnia-Herzegovina, Palestine, Tunisia, Morocco, Egypt, Albania, Georgia, Montenegro, Serbia, Chile, Mauritius, South Korea, Malaysia, Moldova, Faroe Islands, Singapore, United Kingdom, Venezuela, and Kosovo. (ITA, 2022) *Aligns its commercial policy with the EU’s Common Commercial Policy. (ITA, 2022) Gross Domestic Product 1414.19 billion (US dollars) in 2022. (Trading Economics, 2023) *4.56 trillion (US dollars). (WPR, 2022) *714.30 billion (US dollars). (WPR, 2023)

Category Mexico Germany Turkey Purchasing Power Parity Economic performance can be compared using common currency. The purpose is to convert local currency into a baseline designed for such a comparison. Reveals the absolute purchase power of their money. Helpful in telling us how much investors believe their currency to be worth and to get a better understanding of how our profits there would compare in terms of real value. *10.04 PPP in 2021 with a population of 128,455,567. (WPR, 2023) *0.74 PPP or 0.736 USD. *Population of 83,294,633 *Information as of 2021. (WPR, 2023) *2.78 PPP or 2.809 USD. *Population of 85,816,199. *Information as of 2021. (WPR, 2023) Gross Domestic Product Per Capita *10,741 (WPR, 2023) *54,803 (WPR, 2023) 8,324 (WPR, 2023) Section Three My Choices Based on the above data, the most appropriate of the three countries to introduce my product in would be Germany. They have the fourth largest economy in the world and are given 8.22/10 points on the business ranking model by the Economist Intelligence Unit. Their GDP is also highest at four and a half trillion U.S. dollars or approximately $54,800 in output person. Their political system is also performing at high capacity, they have a constitution protecting the people of the country’s universal human rights. They are the most significant country in the EU, holding trade agreements with many other countries and are, in fact, the United States’ largest European trader. It makes sense that a new product would perform best here. The second choice of the three countries in which to introduce my product in would be Mexico. Mexico is an emerging, developing country with a strong economy. Their mixed market works well for them, and their newest political administration has made growth a priority. They have the 14 th largest nominal GDP in the world, thirteen free trade agreements with a total of fifty countries and are major U.S. trading partners. Their GDP is 1414.19 billion U.S. dollars, or an output of about $10740 per person. They scored a 6.36/10 on the business ranking model by the Economist Intelligence Unit.

Finally, my last choice would be Turkey. While Turkey is an emerging economy, they are still a bit underdeveloped in comparison with the rest of the world. They have the 19 th largest economy, however, and their GDP is about half of Mexico’s total, around 715 billion U.S. dollars, an output of around. They are currently a unitary state, and their government is set up so that corruption is very difficult to catch and stop, an issue they must work on fixing in the future to thrive politically. They rank 6.02/10 on the business ranking model by the Economist Intelligence Unit, a number not much different from Mexico’s. Currently, they have 22 free trade agreements and 11 others than were consolidated into the EU. Turkey is a country to keep an eye on and I would certainly consider introducing my product there in the future.

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References Chepkemoi, J. (2017). What Type of Government Does Turkey Have? What Type Of Government Does Turkey Have? - WorldAtlas Country Reports. (2023). Turkey Government. Turkey government structure and political parties. | - CountryReports Heritage Foundation. (2023). 2023 Index of Economic Freedom: Germany. German Economy: Facts, Population, GDP, Inflation, Unemployment, Business (heritage.org) Heritage Foundation. (2023). 2023 Index of Economic Freedom: Turkey. Türkiye Economy: Population, GDP, Inflation, Business, Trade, FDI, Corruption (heritage.org) International Trade Administration. (2022). Germany Country Commercial Guide: Market Overview. Germany - Market Overview (trade.gov) International Trade Administration. (2022). Mexico Country Commercial Guide: Trade Agreements. Mexico - Trade Agreements International Trade Administration. Turkey Country Commercial Guide: Trade Agreements. Turkey - Trade Agreements Li Cain, S. (2021). What Is a Trade Bloc? Trade Bloc | Definition & Examples | InvestingAnswers Pariona, A. (2019). The Economy of Mexico. The Economy Of Mexico - WorldAtlas Ramirez, E. G. (2021). European Parliamentary Research Service. Mexico’s Parliament and Other Political Institutions. Mexico's Parliament and other political institutions (europa.eu) RBC. (2023). Mexico: Economic and Political Overview. Economic and Political Overview of Mexico (rbc.com) Sawe, B. (2017). What Type of Government Does Germany Have? What Type of Government Does Germany Have? - WorldAtlas The Economist Intelligence Unit. (2023). Rankings Overview. EIUCountry Login Trading Economics. (2023). Mexico GDP. Mexico GDP - 2023 Data - 2024 Forecast - 1960-2022 Historical - Chart - News (tradingeconomics.com) World Population Review. (2023). GDP Ranked by Country 2023. GDP Ranked by Country 2023 (worldpopulationreview.com) World Population Review. (2023). Purchasing Power Parity by Country 2023. Purchasing Power Parity by Country 2023 (worldpopulationreview.com)

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