Madagascar Team Report

Luke Penne Ngoan PhanMadagascar Team ReportJuliette Rakotomalala Alex Scalera

Product Industry & Political EnvironmentJuliette RakotomalalaGeography

(Central Intelligence Agency, C. Michael Hogan, U.S. State Department, and World Wildfire Fund, 2012), (Interactive Map, 2012), (Madagascar, n.d.), (Madagascar, 2013), (Undefined, 2008)Antananarivo Merina or Hova; Atsiranana and Tomatave Betsimisaraka; Atsiranana and Majanga-Sakalava; Feanrasu-Betsineo; Tol-e-ar - AntaneroyProduct and IndustryUnique natural environment filled with a wide variety of resourcesLocated on the crossroads between Asia and Africa Competitive labor force

Chromite mining and exporting Chromite is a key industrial mineral extremely high melting point.

Political IssuesCoup dtat 2009How should the capital be runned? How should the country be runned? Marc Ravalomanana vs.Andry Rajoelina

(Cook & Ploch, 2012)Political ConcernsUpholding of contracts and agreementsUnlawful cancelationTakeoverNegative affects and threat to safety in light of another rise of political disagreementDamage resources and facilitiesInhibit operations and loss of profits Safety

SolutionsUnited StatesOne of the most powerful countries in the worldUnited NationsAfrican UnionSouth African UnionIMFWorld BankWorld Trade OrganizationRescue departments and resources, and rules and regulations(U.S. Relations with Madagascar, 2012)

Mode of Entry & Economic ElementsLuke Penne

Mode of EntryCurrently Kraomita Malagasy, a state-owned chromite mining and exporting enterprise, is the only chromite exporting operation in MadagascarExports 100,000+ tons of chromite per year380 employeesOur company will be pursuing a joint venture strategy, pairing our financial resources with their current expertise to expand operationsBenefit from economies of scale Shorter learning curveCompete globally on a cost basisInvestment risk, Political stability risk, Personality risk

Economic JustificationBemanevika Well maintained railway connecting to large coastal portLocal business relationshipsOvercome language barriersJoin local free trade organizations to benefit from lower port feesCustomersArcelorMittal S.A. is the worlds largest steel producerBoasteel Group Corporation (China)POSCO (S. Korea and California)(B2B Metal, 2013)

Economic-Commercial EnvironmentGDP: 0.06% of that in the US in 20126%-10% inflation per annumNegative current account balanceOil, Minerals, WoolLabor Force in 2010: 10,184,339Internet users in 2011: 1.9% of population36% Tax rate on business profits(World Bank Group, 2013)

Economic-Commercial EnvironmentHome to a well-developed labor force The chief public university is located in the capital, Antananarivo The training specializes in mining, forestry and textile production, Madagascar's three main industriesDiverse array of industrial facilitiesThree chrome mines, three hydro power stations, two lighthouses, one nickel mine, one simple oil refinery and ten water storage dams(Mbendi Information Services, 2013)

Economic-Commercial EnvironmentMarketing and consulting are relatively new industries in MadagascarNewspapers, billboards, TV, radioSome market research and technological advising firmsBusiness associations that encourage trade and enterpriseBring American and Malagasy business people togetherHost "Made in Madagascar" trade showsReduce customs interventionProtect legal property rightsOffer documentation assistance to new businesses

(US Commercial Service, 2011)

Madagascars InfrastructurePoor conditions have caused financial difficulties49,827 km of roads, of which just 5,780 km are paved211 airfields, of which only 50% are useable Sparse telecommunications system3 in 1,000 residents own a telephone60 percent of telephones are in the capital1.9% of population are Internet users15 major ports along the coast fare much better than other infrastructure

(Wild Madagascar, 2013)

Travel ConsiderationsAlex ScaleraHealth and Safety MattersGet your shotsMalaria, Tuberculosis, RabiesNever drink water unless its been properly treatedHave medical insuranceBring a medical kit

(Madagascar Health and Safety, 2013)FoodFrench in styleNot very spicyNational dish: RomazaBeef with mixed greens sauteed with ginger, tomato, and onionLots of rice, fish, fruit and vegetablesThree Horses Beer; brewed in AntsirabeVery strong rum

(Madagascar Food, 2013)Entertainment and Sight-seeing OpportunitiesMontagne d'Abre; National ParkQueens PalaceVolcanoes and WaterfallsDiving and SurfingExplore Mountains

(Madagascar Things to Do and See, 2013)Acceptable vs. Unacceptable BehaviorRespect EldersShoulders to knees should always be coveredRespect wildlife

LitteringDisturbing NatureDisrespecting Elders

(Madagascar Safe and Responsible Travel, 2013)In-Country TravelPoor roadsTaxi's; 15 seat vansTaxi stations located on the outskirts of town and airportsBike cartsBest way to travel: Walk(Madagascar Country Specific Information, 2013)Shopping and SouvenirsLocal MarketsCloth FabricJewelryWoodworks (Shopping in Madagascar, 2013)Visa and Other Entry RequirementsVisaPassport; One blank page6 months validity Visa fees; May be paid in U.SMust have shotsFly into Antananarivo (Madagascar Country Specific Information, 2013)Travel ConcernsFlooding can halt the mining process during rainy seasonsHours of operation will vary based on the seasonMandatory vaccines and health insurance for all employees

Socio-Cultural EnvironmentNgoan Phan

Forms of CommunicationLanguages: Malagasy, French, EnglishVariations of Malagasy Dialects based on where you are fromStyle of communication: indirectly and inexplicitlyStyle of business negotiation: bargainingBusiness corruption: in 2012, ranked 118th out of 175 countries surveyed

(Madagascar-Communication style., n.d.; Madagascar-Negotiation., n.d.; Doing Business in Madagascar: 2011, 2011)

Religions(Religion in Madagascar, n.d.)

Ethnic GroupsThe largest and most dominant is MerinaThe second largest is the Betsimisaraka (The Inseparable Multitude)The third most numerous is the Betsileo (The Invincible Multitude)

(Society and Culture of Madagascar, n.d.)

Ethnic GroupsOther important peoples Tsimihety (Those Who Do Not Cut Their Hair)Sakalava (People of the Long Valley)Antandroy (People of the Thorn Bush)Tanala (People of the Forest), Antaimoro (People of the Banks)Bara (a name of uncertain origin)

(Society and Culture of Madagascar, n.d.)

Ethnic GroupsSmaller groups Antanosy (People of the Island)Antaifasy (People of the Sand)Sihanaka (People of the Lake)Antakarana (People of the Rocks) Betanimena (People of the Red Soil), who are now largely absorbed by the Merina Bezanozano (Those with Many-Braided Hair)Mahafaly (Those Who Make Taboos).

(Society and Culture of Madagascar, n.d.)

Social, Economic, Political ElitesThe president, Andry Nirina RajoelinaThe prime minister who is appointed by the president, is Jean Omer BeridikyThe richest man is Ravalomanana

(Two Men, One Island, n.d.)

Socio-Cultural ConcernsInterest in working with American businessesEnglish is widely used in the Malagasy business worldPartnering with Independent Anti-Corruption Bureau Help us understand the native indirect communication style

Doing Business in Madagascar: 2011, 2011

ReferencesCentral Intelligence Agency, C. Michael Hogan, U.S. State Department, and World Wildfire Fund. (2012). Retrieved on April 2, 2013 from The Encyclopedia of Earth: http://www.eoearth.org/article/Madagascar?topic=49460.Cook, N., & Ploch, L. (2012). Madagascars Political Crisis. n.d.:n.d."Doing Business in Madagascar: 2011 Country Commercial Guide for U.S. Companies." (2011). Usembassy.gov. Retrieved Mar. 20, 2013: http://www.antananarivo.usembassy.gov/uploads/ZI/VP/ZIVPQJmobFfciu9aI_lf2g/CCG-2011-MadagascarDoing Business in Madagascar - World Bank Group. Doing Business in Madagascar - World Bank Group. The World Bank Group, 2013. Web. 25 Feb. 2013. Interactive Map (2012). Retrieved March 20, 2013, from EDBM: http://www.edbm.gov.mg/Business-opportunities/Interactive-mapMadagascar.(n.d.). Madagascar. International Labour Organization. Retrieved February 25, 2013: http://www.ilo.org/ipec/projects/global/tackle/madagascar/lang--en/index.htm

ReferencesMadagascar. (2013). In Encyclopdia Britannica. Retrieved from http://www.britannica.com/EBchecked/topic/355562/MadagascarMadagascar - An Overview. (2013). MBendi.com. Retrieved Mar. 4, 2013: http://www.mbendi.com/land/af/md/p0005.htmMadagascar-Communication Style. (n.d.). Culture Crossing. Retrieved Mar. 21, 2013 http://www.culturecrossing.net/basics_business_student_details.php?Id=8&CID=123Madagascar Country Specific Information. (2013, April 15). Retrieved from International travel information: http://travel.state.gov/travel/cis_pa_tw/cis/cis_957.htmlMadagascar Food. (2013, April 15). Retrieved from Roots of the Sky: http://www.rootsofthesky.com/madagascar/people/food/Madagascar Health and Safety. (2013, April 15). Retrieved from Places Online: http://www.placesonline.com/africa/madagascar/health_and_safety.asp

ReferencesMadagascar-Negotiation. (n.d.). Culture Crossing. Retrieved Mar. 21, 2013: http://www.culturecrossing.net/basics_business_student_details.php?Id=22&CID=123Madagascar Safe and Responsible Travel. (2013, April 15). Retrieved from Intrepid Travel: http://www.intrepidtravel.com/us/madagascar/safe-responsible-travelMadagascar things to do and see. (2013, April 15). Retrieved from World Travel Guide: http://www.worldtravelguide.net/madagascar/things-to-doMadagascar-Transportation and Telecommunications. Madagascar-Transportation and Telecommunications. Monga Bay. Retrieved Mar. 4, 2013: http://www.mongabay.com/history/madagascar/madagascar-transportation_and_telecommunications.html"Religion in Madagascar."(n.d.). Religion in Madagascar. Retrieved Mar. 17, 2013: http://www.mapsofworld.com/madagascar/society-and-culture/religion.html

Society and Culture of Madagascar. (n.d.). Retrieved April 4, 2013, from Maps of World: http://www.mapsofworld.com/madagascar/society-and-culture/Shopping in Madagascar. (2013, April 15). Retrieved from Madagascar Consulate: http://www.madagascarconsulate.org.za/shop.htmlTOP25 World's Largest Steel Companies. TOP25 World's Largest Steel Companies. B2B Metal & Steel Products, n.d. Web. 01 Apr. 2013Two men, one island. (2013). The African Times. Retrieved April 16, 2013: http://www.african-times.com/index.php?option=com_content&view=article&id=1373%3Atwo-men-one-island&catid=63%3Amarch-2009-politics&Itemid=63Undefined. (2008). Geography of Madagascar. Retrieved on March 27, 2013, from Wild Madagascar: http://www.wildmadagascar.org/overview/geography.htmlU.S. Relations with Madagascar. (2012, Dec. 19). Retrieved March 14, 2013, from U.S. Department of State: http://www.state.gov/r/pa/ei/bgn/5460.htm

References