Social, cultural, economic, legal and political conditions
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Many aspects affect the way international business is conducted. Differences in the social, cultural, economic, legal and political conditions of the country affect international business procedures in different levels and degree depending on the countries infrastructure and relationship.
Social differences range from a country’s income per consumer, literacy rates, religious beliefs and code of ethics. Social conditions affect the way companies conduct business and the development and promotion of products.
Social differences in Haiti post serious threats to its international business success and the country’s ability to change its economic trend. With a huge wealth gap between the impoverished and wealthy, the country’s collapsed infrastructure and corrupt judicial system, low literacy rates, not to mention it’s unconventional religious beliefs social conditions are dramatically different than most international markets. “Hurdles for businesses in Haiti include poor infrastructure, a high-cost port, an irregular supply of electricity, and customs delays.” (Bureau of Western Hemisphere Affairs)
Cultural differences also have an impact on business functions such as customer service management and business decision-making. Cultures vary in their attitude toward property, use of resources, division of labor and how companies conduct business. Marketers must sometimes adopt their campaign strategy depending on the culture and language. Language differences can lead to problems for companies when marketing slogans and concepts don’t translate well.
Cultural differences in Haiti exist within the country itself, French is one of two official languages, but it is spoken by only about 10% of the people. All Haitians speak Creole, the country’s other official language. English is increasingly spoken among the young and in the business sector. The state religion is Roman Catholicism although some Haitians have converted to Protestantism through the work of missionaries active throughout the country. Roughly half of the population also practices voodoo traditions. Haitians tend to see no conflict in these African-rooted beliefs coexisting with Christian faiths. Though Haitians place a high value on education, few can afford to send their children to secondary school. (BBC News Country Profile)
Economic differences exist in many aspects when conducting international business, ranging from various economic systems with several different markets, the supply and demand of the country; with levels of buying power, standard of living, GDP, and GNP; to a countries national debt and economic trend. Economic stability might be the most obvious economic difference and most important because it determines a countries buying power.
Economic differences in Haiti is extremely apparent; currency exchange has fluctuated considerably in the last few years. Gourds per US dollar – 26.674 (January 2002). (CIA.gov) The U.S. remains Haiti’s largest trading partner.
“In 1999, Haiti’s economy began to falter after about 4 years of positive, though modest growth. Real GDP growth fell in 2001 by 1.2%. The Privatization program stalled. Macroeconomic stability was adversely affected by political uncertainty, low investment, a significant increase in the budget deficit, and reduced international capital flows. The lack of an agreement with the IMF has prevented the resumption of crucial international assistance. This recent weakening of the economy has serious implication for future economic development as well as efforts to improve the general standard of living.” (Bureau of Western Hemisphere Affairs)
Legal Differences such as laws and regulations that apply to the U.S. often do not apply to other international markets, which are all governed by a different set of laws and regulations that are often inconsistent with other countries.
Legal Differences in Haiti exist mainly through differences in the political arena, also Haiti is based on a Roman Civil law system and “The government places a 30% withholding tax on all profits received. There is little direct investment, though more is incoming than outgoing.” (Bureau of Western Hemisphere Affairs)
Political differences have an enormous impact on international business, a countries political system, elections, and major political parties often clash and in turn affect the laws and regulations pertaining to specific countries for example, the embargo of Cuba.
Political differences in Haiti stem mainly from over three decades of dictatorship followed by a political crisis stemming from fraudulent legislative elections in 2000, which have not yet been resolved; this in turn negatively affects international business.
Despite all the factors that can potentially derail collaborations between countries, the commitment to the progress of ones country, consumer need for products not readily available, potential economic growth through trade and the rapid increase of sales through the internet will enviably help bridge the global markets.