World Political Environment

8/8/2019 World Political Environment

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INTERNATIONAL BUSINESS

WORLD POLITICAL

ENVIRONMENTSUBMITTED TO:- SUBMITTED BY:- Ms. Deepti Dabas Hazarika Chayan Mehta

Anubhav MishraAshvini Kaushik

AlpanaAarti JainRajsekharLokesh


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World Political Environment is the discipline

that studies the political and economicalpatterns of the world. It studies the

relationships between cities, nation-states,

shell-states, multinational corporations, non-governmental organizations and international

organizations.


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CONTINENTS IN THE WORLD


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HOW MANY

COUNTRIES IN THE

WORLD?


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THERE IS NO ONE RIGHT ANSWER

As of May 1, 2008, the United Nations has 192members.

The US State Department recognizes 194.

Most of the current World Almanacs use 193

countries.


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There are 193 members of the United Nations.

There are still two recognized independent countries, the Vatican Cityand Kosovo, that are independent and are not members of the U.N.

Taiwan meets the requirements of independent country or state

status. However, due to political reasons, it fails to be recognized by

the international community as independent.

England, Scotland and Wales, all are widely considered individual

countries.

Palestine, Greenland, Western Sahara, bermuda are also countries but

not recognized as independent countries of UN.


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THEREFORE,TOTALNUMBEROFCOUNTRIESIN

THEWORLDARE:


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CONTINENTS (by size)

1 Asia - (44,579,000 sq km)

2 Africa - (30,065,000 sq km)

3 North America - (24,256,000 sq km)

4 South America - (17,819,000 sq km)

5 Antarctica - (13,209,000 sq km)

6 Europe - (9,938,000 sq km)

7 Australia/Oceania - (7,687,000 sq km)

CONTINENTS (by population)

1 Asia - (3,879,000,000)

2 Africa - (877,500,000)

3 Europe - (727,000,000)

4 North America - (501,500,000)

5 South America - (379,500,000)

6 Australia/Oceania - (32,000,000)

7 Antarctica - (0)


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LARGEST COUNTRIES (by land mass)

Russia 17,075,400 sq km, (6,592,846 sq miles)

Canada 9,330,970 sq km, (3,602,707 sq miles)

China 9,326,410 sq km, (3,600,947 sq miles)USA 9.166,600 sq km, (3,539,242 sq miles)

Brazil 8,456,510 sq km, (3,265,075 sq miles)

Australia 7,617,930 sq km, (2,941,283 sq miles)

India 2,973,190 sq km, (1,147,949 sq miles)

Argentina 2,736,690 sq km, (1,056,636 sq miles)

SMALLEST COUNTRIES (by land mass)

Vatican City 0.44 sq km, (0.17 sq miles)

Monaco 1.95 sq km, (0.75 sq miles)Nauru 21.2 sq km, (8.2 sq miles)

Tuvalu 26 sq km, (10 sq miles)

San Marino 61 sq km, (24 sq miles)

Liechtenstein 160 sq km, (62 sq miles)

Marshall Islands 181 sq km, (70 sq miles)

Seychelles 270 sq km, (104 sq miles)


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STAGES

A. Three changes in international political environmentsince 1945

1. Shifts in world distribution of power.

Major shifts of power between states, not to mentionregions, occur infrequently and are rarely peaceful. In theearly twentieth century, the imperial order and theaspiring states of Germany and Japan failed to adjust toeach other. The conflict that resulted devastated largeparts of the globe. Today, the transformation of theinternational system will be even bigger and will requirethe assimilation of markedly different political andcultural traditions.


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2. Emancipation of colonies and emergence of

developing world.

Emancipation (or decolonization) refers to the undoing of

colonialism, the establishment of governance or authority

through the creation of settlements by another country or

jurisdiction. The term generally refers to the achievementof independence by the various Western colonies and

protectorates in Asia and Africa following World War II. This

conforms with an intellectual movement known as post-

colonialism. Decolonization can be achieved by attaining

independence, integrating with the administering power or

another state, or establishing a "free association" status


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3. Rise of non-state actors.

NGO(s): These groups are typically considered a part of civil society.

MNC(s): Multinational Corporations are for profit organizations thatoperate in two or more sovereign states.

The International Media

Violent non-state actors:

Armed groups: for example rebel opposition forces, militias, and

warlords. Terrorist Organizations, Including groups such as Al-Qaeda,

Lashkar-e-Tayyaba.

Criminal Organizations, for example drug cartels.

Religious Groups

The Quakers are quite active in their international advocacyefforts and their supportive role at internationalconferences. They have in part founded other non-state actorssuch as Amnesty International, Greenpeace, and OXFAM.


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1. SHIFTS IN WORLD DISTRIBUTION OF

POWER

A. 1945-47: Unipolar

US dominance in military and economics

In 1947 the US, with 4% of the worldspopulation, produced nearly 50% of its product.

US only major power surviving WWII witheconomy intact

WWII deaths: USSR approximately 20 million; USapproximately 300,000

US lacked large conventional force


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B. 1948-62: Bipolar

Emergence of USSR as rival

Emergence of two hostile blocs in Europe

Emergence of new countries outside Europe Perception by superpowers of zero sum game


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C. 1963-72: Loose Bipolar

USSR reaches strategic/nuclear parity with US

Both alliances show signs of loosening

Competition for allies in developing world


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D. 1973-89: Emerging Multipolarity

Emergence of other powers

USSR acquires global capability

Allies exhibit substantial independence

Developing nations become independent actors

End of perception of zero-sum game


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E. 1990-?: Multi-Level Multipolarity

1. Description of multi-level multipolaritya. Strategic or military level

b. Economic level

2. Characteristicsa. Disintegration of USSR

b. End of communism as ideological force

c. Transformation ofEastern Europe

d. US military dominancee. Decline of developing world

f. Rise of globalization


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2. EMERGENCE OF DEVELOPING

WORLD

1. New countries

UN grows from 51 in 1945 to 189 in 1999

2. Poor countries~ 63 @ less than $760/year

~ 57 @ $761 - $3,000

~ 23 @ greater than $20,000 3. Diverse but concerned with development


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4. A few exceptions:

a. oil producers

5. Newly industrialized countries (NICs): about

$10,000 per capita annually


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3. RISE OF NONSTATE ACTORS

A. Types of Nonstate Actors

1. Intergovernmental organizations (IGOs) 2. Nongovernmental organizations (NGOs)

3. Multinational corporations (MNCs)


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B. Characteristics

1. Growth in numbers

a. IGOs: 37 in 1909 & 260 in 1997; almost 300

today

b. NGOs: 176 in 1909 & 5,500 in 1997; nearly

25,000 today

c. MNCs: nearly 38,000 in 1996 accounting for

over 90% of trade among developed

countries


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2. Growth in influence

3. Carry out own foreign policy 4. Many MNCs are US-based

5. World no longer state-centric

6. Emergence of terrorist organizations


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POLITICAL SYSTEM

The political system is characterized by form of govt. that may takevarious forms b/w two extremes of democracy & dictatorship.

For doing business successfully it is more imp. For international

marketer to know:

What political parties & interest groups exist in a specific

country market.

What their goals are & how much influence they can exert on

the local govt.

Such interest group & their ability to influence the major political

objectives of govt. strongly determine the stability of the political

environment.


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POLITICAL SYSTEM STABILITY

For the international marketers, the most important factor forthe political environment is the stability of the served country

markets political system. The level of instability can have a

major impact on the economy development of a country or

region because it influences the perceived risk of potentialinvestors. Political instability, even if it is highly welcome for

other reasons, makes the business less predictable and

predictability is the key to long term business success.


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Although govt. of countries vary greatly in the actual form of their

political mechanisms;

Denmark, Thailand, Mexico, Tunisia, Canada, & Austrailia, for eg,

consider themselves as democracies.

Countries such as Netherland, U.K, Japan are also constitutional

monarchies

Each has a royal head of govt. with limited & specified roles.

According to the United Nations Human DevelopmentR

eport, 81countries have taken significant steps towards democracy, with 33

military regimes replaced by civilian government. Of the worlds 203

countries, 140 now hold multiparty elections.


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Documents

World Political Environment