REPORT

INTERNATIONAL BUSINESS
“UNITED KINGDOM”

LECTURER : ARIEF BUDIMAN, SE, MMKTG, PHD

NIP : 19760122 200012 1 001

(This paper submitted to fulfill the middle test of international business courses)

BY :

MUHAMMAD REZA IRAWAN

NIM : 1810312120014

MANAGEMENT

ECONOMICS AND BUSINESS FACULTY

LAMBUNG MANGKURAT UNIVERSITY

BANJARMASIN

2021
 INTERNATIONAL BUSINESS OF UNITED KINGDOM

A. The Scope and Challenge of International Marketing & The Dynamic Environment of
International Trade
Renowned for its art, food and rich history, Italy remains an attractive economy for
investment as it recovers from the global financial crisis and continues to grow steadily each
year. Once home to the Roman Empire, Italy is now home to over 60 million people. Due to
its location in Europe and the Mediterranean, it contains a myriad of different cultures and
traditions. The country plays a prominent global role in everything from economics to
military and diplomatic affairs.
Major obstacles that companies may encounter when doing business in Italy are a
complex bureaucracy and regulatory framework, a slow judicial system, and competitive
challenges due to high levels of bribery, corruption and tax evasion. On the one hand, Italy
boasts one of the largest economies worldwide and in Europe in terms of GDP. On the other
hand, it often ranks poorly in the Index of Economic Freedom. For this reason, expert advice
is essential when considering doing business in Italy.
Despite Italy’s issues, there are many advantages of doing business there, including
government incentives for foreign investors. Its diversified economy is home to almost all
sectors of industry. While the Northern regions predominantly focus on food, textiles,
machinery, iron and steel, clothing, footwear and ceramics, Southern Italy’s main areas are
agriculture, manufacturing and tourism. There is, however, a clear wealth gap between the
North and South, as the Northern regions are much more affluent. Despite this, Italy is
financially developed and viewed as an ideal country for business, with its modern
infrastructure, gateways to the Mediterranean, Middle East and European markets, and high
levels of internationalization and entrepreneurship.
Cross-cultural awareness is also vital for establishing business connections, as Italian
culture remains very family-oriented. Furthermore, there is a tendency towards hierarchical
attitudes in Italian companies as well as regional biases. On the other hand, meetings are
typically less formal than in many other European nations.
B. Cultural Dynamics in Assessing Global Markets
 History of Unites Kingdom
The history of the United Kingdom began in the early eighteenth century with
the Treaty of Union and Acts of Union. The core of the United Kingdom as a unified
state came into being in 1707 with the political union of the kingdoms
of England and Scotland, into a new unitary state called Great Britain.

British Empire

The british empire was composed of the dominions,

colonies, protectorates, mandates, and other territories ruled or administered by
the United Kingdom and its predecessor states. It began with the overseas
possessions and trading posts established by England between the late 16th and early
18th centuries. At its height it was the largest empire in history and, for over a century,
was the foremost global power. By 1913 the British Empire held sway over 412 million
people, 23 per cent of the world population at the time, and by 1920 it covered
35,500,000 km2 (13,700,000 sq mi), 24 percent of the Earth's total land area. As a result,
its constitutional, legal, linguistic, and cultural legacy is widespread. At the peak of its
power, it was described as "the empire on which the sun never sets", as the sun was
always shining on at least one of its territories.

The Seven Years' War, which began in 1756, was the first war waged on a global
scale, fought in Europe, India, North America, the Caribbean, the Philippines and coastal
Africa. Britain was the big winner as it enlarged its empire at the expense of France and
others. France lost its role as a colonial power in North America. It ceded of New
France to Britain, putting a large, traditioinalistic French-speaking Catholic element
under British control. Spain ceded Florida to Britain, but it only had a few small outposts
there. In India, the Carnatic War had left France still in control of its small enclaves but
with military restrictions and an obligation to support British client states, effectively
leaving the future of India to Britain. The British victory over France in the Seven Years'
War therefore left Britain as the world's dominant colonial power.
Bombardment of Algiers

The term "United Kingdom" became official in 1801 when the parliaments of Great
Britain and Ireland each passed an Act of Union, uniting the two kingdoms and creating
the United Kingdom of Great Britain and Ireland. After the defeat of France at the end of
the French Revolutionary Wars and Napoleonic Wars (1792–1815), the United Kingdom
emerged as the principal naval and imperial power of the 19th century (with London the
largest city in the world from about 1830). Unchallenged at sea, British dominance was
later described as Pax Britannica ("British Peace"), a period of relative peace among the
Great Powers (1815–1914) during which the British Empire became the
global hegemon and adopted the role of global policeman. 
By the time of the Great Exhibition of 1851, Britain was described as the
"workshop of the world".From 1853 to 1856, Britain took part in the Crimean War, allied
with the Ottoman Empire in the fight against the Russian Empire,\ participating in the
naval battles of the Baltic Sea known as the Åland War in the Gulf of Bothnia and
the Gulf of Finland, among others. The British Empire was expanded to include India,
large parts of Africa and many other territories throughout the world. Alongside the
formal control it exerted over its own colonies, British dominance of much of world trade
meant that it effectively controlled the economies of many regions, such as Asia and
Latin America. 
Domestically, political attitudes favoured free trade and laissez-faire policies and a
gradual widening of the voting franchise. During the century, the population increased at
a dramatic rate, accompanied by rapid urbanisation, causing significant social and
economic stresses. To seek new markets and sources of raw materials, the Conservative
Party under Disraeli launched a period of imperialist expansion in Egypt, South Africa,
and elsewhere. Canada, Australia and New Zealand became self-governing dominions.
After the turn of the century, Britain's industrial dominance was challenged by Germany
and the United States. Social reform and home rule for Ireland were important domestic
issues after 1900. The Labour Party emerged from an alliance of trade unions and small
socialist groups in 1900, and suffragettes campaigned from before 1914 for women's
right to vote.
 Country Profile
Name of country : United Kingdom of Great Britain and Northern Ireland
Capital : London
Population :  65.105.246 (2018 estimate)
Area : 243.610 km2
Official language : Inggris
Governance : Monarki Konstitusional
President : Ratu Elizabeth II (6 Februari 1952)
Legislature : Parliament
Ethnic groups : 91.5% Italians and 8.5% others
Religion : 59,5%% Christianity, Islam, 4,4%, Hindu 1,3% others
Currency : Pound Britania Raya (GBP)
Time zone : UTC+1 (WEST), Summer (DST)

 Geography

Picture 1. Geography of United Kingdom

 The total area of the United Kingdom is approximately 244,820 square kilometres
(94,530 sq mi). The country occupies the major part of the British Isles archipelago and
includes the island of Great Britain, the north-eastern one-sixth of the island of Ireland
and some smaller surrounding islands. It lies between the North Atlantic Ocean and the
North Sea with the southeast coast coming within 22 miles (35 km) of the coast of
northern France, from which it is separated by the English Channel. In 1993 10 per cent
of the UK was forested, 46 per cent used for pastures and 25 per cent cultivated for
agriculture. The Royal Greenwich Observatory in London was chosen as the defining
point of the Prime Meridian[160] in Washington, DC, in 1884, although due to more
accurate modern measurement the meridian actually lies 100 metres to the east of the
observatory.[161]
The United Kingdom lies between latitudes 49° and 61° N, and longitudes 9°
W and 2° E. Northern Ireland shares a 224-mile (360 km) land boundary with the
Republic of Ireland. The coastline of Great Britain is 11,073 miles (17,820 km) long. It is
connected to continental Europe by the Channel Tunnel, which at 31 miles (50 km) (24
miles (38 km) underwater) is the longest underwater tunnel in the world.[163]
England accounts for just over half (53 per cent) of the total area of the UK,
covering 130,395 square kilometres (50,350 sq mi). Most of the country consists of
lowland terrain, with more upland and some mountainous terrain northwest of the Tees-
Exe line; including the Lake District, the Pennines, Exmoor and Dartmoor. The main
rivers and estuaries are the Thames, Severn and the Humber. England's highest mountain
is Scafell Pike (978 metres (3,209 ft)) in the Lake District.

 Culture
The culture of the United Kingdom has been influenced by many factors including:
the nation's island status; its history as a western liberal democracy and a major power; as
well as being a political union of four countries with each preserving elements of
distinctive traditions, customs and symbolism. As a result of the British Empire, British
influence can be observed in the language, culture and legal systems of many of
its former colonies including Australia, Canada, India, Ireland, New
Zealand, Pakistan, South Africa and the United States; a common culture coined today as
the Anglosphere. The substantial cultural influence of the United Kingdom has led it to
be described as a "cultural superpower". A global opinion poll for the BBC saw the
United Kingdom ranked the third most positively viewed nation in the world (behind
Germany and Canada) in 2013 and 2014.

Literature

"British literature" refers to literature associated with the United Kingdom, the Isle
of Man and the Channel Islands. Most British literature is in the English language. In
2005, some 206,000 books were published in the United Kingdom and in 2006 it was
the largest publisher of books in the world. The English playwright and poet William
Shakespeare is widely regarded as the greatest dramatist of all time. The 20th-century
English crime writer Agatha Christie is the best-selling novelist of all time. Scotland's
contributions include the detective writer Arthur Conan Doyle (the creator of Sherlock
Holmes), romantic literature by Sir Walter Scott, the children's writer J. M. Barrie, the
epic adventures of Robert Louis Stevenson and the celebrated poet Robert Burns.

Music

Throughout its history, the United Kingdom has been a major producer and source

of musical creation, drawing its early artistic basis from church music and the ancient and
traditional folk music and instrumentation of England, Scotland, Northern Ireland,
and Wales. Each of the four countries of the United Kingdom has its own diverse and
distinctive folk music forms, which flourished until the era of industrialisation when it
began to be replaced by new forms of popular music, including music hall and brass
bands. Many British musicians have influenced modern music on a global scale, and
the United Kingdom has one of the world's largest music industries. Global music widely
developed by British acts include pop, rock, as well as subgenres of the genre; avant-
funk, new wave, acid jazz, neo soul, trip hop, dubstep and industrial.
In the 20th century, influences from the music of the United States,
including blues, jazz, and rock and roll, became entrenched in the United Kingdom. The
"British Invasion"—spearheaded by Liverpool band the Beatles, often regarded as
the most influential band of all time saw British rock bands become highly influential
around the world in the 1960s and 1970s. Pop music, a term which originated in Britain
in the mid-1950s as a description for "rock and roll and the new youth music styles that it
influenced", was developed by British artists like the Beatles and the Rolling Stones,
whom among other British musicians led rock and roll's transition into rock music.
Subgenres of rock developed or invented by British acts include progressive rock, raga
rock, psychedelic rock, art rock, hard rock, space rock, heavy metal, glam rock, gothic
rock, and ska punk.

Art

The Art of the United Kingdom refers to all forms of visual art in or associated with
the United Kingdom since the formation of the Kingdom of Great Britain in 1707 and
encompasses English art, Scottish art, Welsh art and Irish art, and forms part of Western
art history. During the 18th century, Britain began to reclaim the leading place England
had previously played in European art during the Middle Ages, being especially strong in
portraiture and landscape art.
Increased British prosperity at the time led to a greatly increased production of
both fine art and the decorative arts, the latter often being exported. The Romantic period
resulted from very diverse talents, including the painters William Blake, J. M. W.
Turner, John Constable and Samuel Palmer. The Victorian period saw a great diversity of
art, and a far bigger quantity created than before. Much Victorian art is now out of critical
favour, with interest concentrated on the Pre-Raphaelites and the innovative movements
at the end of the 18th century.
The training of artists, which had long been neglected, began to improve in the 18th
century through private and government initiatives, and greatly expanded in the 19th
century. Public exhibitions and the later opening of museums brought art to a wider
public, especially in London. In the 19th century publicly displayed religious art once
again became popular after a virtual absence since the Reformation, and, as in other
countries, movements such as the Pre-Raphaelite Brotherhood and the Glasgow
School contended with established Academic art.
 The British contribution to early Modernist art was relatively small, but since World
War II British artists have made a considerable impact on Contemporary art, especially
with figurative work, and Britain remains a key centre of an increasingly globalized art
world

C. Culture, Management Style, and Business Systems

 Business Culture
Business Mentality
 Working hours in the UK are typically from 9am – 6pm.
 The British business culture can be characterised by an esteem for rank, age and
authority. Be respectful to everybody you meet, but try to gauge the seniority of the
person you are dealing with and react accordingly.
 Patience is a great British virtue. Do not rush people or attempt to coerce them into snap
decisions.
 Contracts are important. Expect agreements to be formalized in writing.

Greetings

 For both introductions and departures, a firm handshake and assertive eye contact are
appreciated.
 Politeness is at a premium in the culture. Simple gestures of courtesy, such as holding
doors open for others, are appreciated. (Although there is a fine balance. Do not hold
open a door for someone at the other end of a corridor, as this will oblige the person to
quicken their pace, and can be madly irritating.)
 The degree of formality will vary between sectors and companies, but the best protocol is
to do as others around you do.
 ‘Hello’ and ‘Good morning/afternoon/evening’ are all safe, neutral greetings. Curiously,
you may hear in very traditional, upscale settings the greeting ‘How do you do?’ This is
not really a question, and the person asking this is not enquiring after your health; the
only appropriate reply is a ‘How do you do?’ in return.

The Art of convertsation

 While it is impossible to capture the diversity of manners, accents, and styles you will
encounter across the regions of the UK, the modus operandi of communication tends to
be understatement, especially compared to more direct styles ‘across the pond’ (i.e the
Atlantic Ocean.) Be prepared to infer a lot of what is meant.
 If you take everything that is said at face value, you might not catch our drift. For
example, if a Briton deems something ‘quite good’, this can often mean ‘a bit
disappointing’, while ‘not bad’ can often mean ‘exceptional’. “With the greatest respect”
is often a prefix to a scathing takedown. Pay attention to tone; if someone says your
proposal is ‘very interesting’, they are not necessarily impressed. And if someone asks
“Could we consider some other options?”, do not take this to mean that they still have not
decided. In all probability, they just don’t like the idea.
 Accordingly, your own criticisms will still be understood if they are indirect.
 English is spoken, and people are proud of it. While the large cities are very
multicultural, business in the UK is strictly monolingual. Come expecting to conduct a
deal in English, as people will not be appreciative if you exclude them by speaking your
own language over them. People may in fact have some command of a second language,
but could be afraid to risk making mistakes publicly; do not take this to mean that there is
no chance you will be understood.
 Introductory small talk about mundane subjects is quite normal. While in other European
countries, initiating a topic of conversation as banal as ‘today’s weather’ can offensively
suggest that the person is boring, in the UK it is par for the course.
 The British are known for their distinctive brand of humour, which tends to be laced with
irony, and often values eccentricity. Moreover, British humour in conversation can be
very self-deprecating in a way that is unthinkable in other cultures. A related issue is that
boastfulness is not appreciated.

Business meetings and Meals

 Business attire is formal and conservative. An evening event described as ‘black tie’
does not require a long necktie; this is funeral dress. Wear a black bowtie instead.
 Please be advised of the prevalence of the ‘stiff upper lip’ phenomenon. Some Brits,
upon having a bad experience, are so averse to making a scene that they will put up
 with the situation rather than complain. Stay attuned to this unease with directly
expressing displeasure.
 Outside of the business environment, people may gather in a pub for a pint or ‘a swift
half’. It is wise to accept invitations to join, as this is the best way of forming
relationships. Do not be alarmed if your pint of Great British beer is served at room
temperature; it is better that way.

Management Style
Punctuality and time management are extremely important in the UK. It is
important to arrive on time or even slightly early. Tardiness reflects badly in a
professional setting and foreign associates should definitely inform their British
counterparts of their delay with an explanation and an apology. Meetings are also timed
in advance and the agenda is expected to be shared prior to the meeting. Meetings usually
follow the agenda. However, if there are other issues to discuss, the British may leave
time for them at the end.

 Business Systems
Basis of Legal System
 The legal drinking age to purchase alcohol at a bar or liquor store is 18.  Sixteen- and
seventeen-year-olds may consume beer, wine, porter, cider, or sherry with a meal in
an eating area on licensed premises if they are in the company of an adult and the
adult purchases the alcohol.
 Penalties for possession, acquisition, and trafficking of drugs are severe and include
mandatory lengthy imprisonment in local jails. 
 It is illegal to be drunk and disorderly or drunk and incapable, both can be dealt with
by a fine or court appearance.

D. Ethics in International Business

When doing business in UK having cross cultural skills should improve the potential of
our business trip. Courtesy is a quality that is very much appreciated in UK, so ensure our
conduct is always polished. There are specific etiquettes and protocols for individual social
and business situations however, we should remember that Italian codes of behavior are less
important than consideration.
Negotiations
 Decisions tend to be made from the top down and can take sometime.
 Humor is often used in negotiations, sometimes as a defense mechanism or in the form of
self-deprecation and/or irony.
 Avoid hard selling and any sort of conflict or confrontation.

Gift giving
 Gifts are not usually exchanged at a first meeting.
 If invited to an English household, it is appropriate to bring flowers (avoid white lilies as
they are reserved for funerals), good wine, liquor, or chocolates.
 Make sure that gifts are nicely wrapped.

Business dress code

Formal business attire is the norm both for men and women in the United Kingdom.
Men are expected to wear dark coloured suits with shirt and tie whereas women usually
wear business suits, dresses or blouses. Accessories are usually worn. Business casual
attire or t-shirt and jeans are accepted in less formal sectors
In the UK, still today, business attire is business formal and conservative for many
industries such as finance, investments, and professional services. For these industries,
men wear suits in darker shades, with dress shirts and ties. Men should avoid striped ties
because of their representation of various institutions. Wear laced shoes, not slip-on
loafers. Women also wear darker colors, skirts or trousers in more conservative
businesses. Jeans are not commonly worn in the everyday business world.
In the startup world, casual and trendy stylish is the dress code. Being overdressed
can be just as off putting as being underdressed so make sure to know something about
the person you’re meeting with. It’s best to err on the more professional side with adding
a leisure jacket over a casual shirt and pants or skirt, which you can then take off if
needed.
 Other business ethics
 Direct eye contact is generally maintained during conversations, but not to the point
of staring.  
 Looking away when an elder is speaking is usually viewed as disrespectful.
 The English tend to keep about an 2-3 feet between them while speaking.
 Touching is usually kept to a minimum.
 Family members are more relaxed and familiar with each other, so touching of the
arms, elbows, or hands is acceptable.  However in a business environment, touching
is very minimal and personal space is respected much more than in a family setting.

E. The Political Economy of International Trade

The economy of the United Kingdom is a highly developed social market and market-

orientated economy. It is the fifth-largest national economy in the world measured by
nominal gross domestic product (GDP), ninth-largest by purchasing power parity (PPP),
and twenty first-largest by GDP per capita, constituting 3.3% of world GDP.The UK is one
of the most globalised economies, and comprises England, Scotland, Wales and Northern
Ireland.[a] In 2019, the UK was the fifth-largest exporter in the world and the fifth-largest
importer. It also had the third-largest inward foreign direct investment,[40] and the fifth-
largest outward foreign direct investment. In 2020, the UK's trade with the 27 member states
of the European Union accounted for 49% of the country's exports and 52% of its imports.

Trade Agreements
The trade deficit (goods and services) narrowed £0.2 billion to £7.9 billion in the three
months to November 2018 as both goods and services exports each increased £0.1 billion
more than their respective imports. Excluding erratic commodities (mainly aircraft) the total
trade deficit widened £1.2 billion to £9.5 billion in the three months to November 2018.Large
increases in export prices of oil and aircraft drove the narrowing of the total trade deficit;
removing the effect of inflation, the total trade deficit widened £0.3 billion to £6.5 billion in
the three months to November 2018.
The trade in goods deficit widened £0.8 billion with EU countries and narrowed £0.9
billion with non-EU countries in the three months to November 2018, due mainly to
increases in imports from EU countries and exports to non-EU countries.The total trade
deficit widened £4.1 billion in the 12 months to November 2018 due mainly to a £4.4 billion
narrowing in the trade in services surplus.After the withdrawal of the United Kingdom from
the European Union, the negotiation of a trade deal between the UK and the European Union
including her 27 member states might have the same status than third countries for statistics
related to imports and exports with the UK:

 According to OEC World 2017 data, the EU 27-2020 could become/stay one of the
notable partners of the UK, with exports from the UK reaching near $200B, close
from the United States ($45B, and China $21B).

 According to OEC World 2017 data, the EU-27-2020 could become/stay one of the
notable partners of the UK, with imports to the UK reaching near $330B, close from
from the United States ($46B, and China $58B).
Imports
 Customs Authority
Customs laws and regulations are enforced by Her Majesty's Revenue and Customs
(HMRC). HMRC's enforcement powers are set out in the UK Customs and Excise
Management Act 1979, as amended. General guidance on the importation process can be
found at Gov.uk: Import goods into the UK.The main repository for customs
documentation can be found at Gov.uk: Import, export and customs for businesses:
detailed information. Importers wishing to bring goods into the England, Scotland or
Wales must obtain a GB Economic Operators Registration and Identification (EORI)
number. Importers wishing to import goods into Northern Ireland must obtain an XI
EORI number, subject to some exceptions (for example, if goods are to be solely moved
on the island of Ireland). Filings in the UK are mostly conducted electronically.
 Import Duties, Tariffs and Rates
General Tariffs and Rates
The UK Department for International Trade conducts all new negotiations by
promoting and financing international trade and investment and championing free trade.
Most of the trade deals concluded by the UK since it exited the EU have been concluded
 relatively quickly, mainly due to both parties agreeing to roll over the content of existing
EU trade agreements into bilateral arrangements with the UK.

Preferential Tariffs
The UK continues to apply preferential tariffs to a large number of jurisdictions,
including the EU. The application of preferential tariffs depends on compliance with
rules of origin applicable in the UK and contained in each respective trade
agreement. give effect to the preferential import duty rates, including related rules of
origin requirements, in trade agreements that the UK has entered into with other
countries. The UK also maintains a generalised scheme of preferences.

 Non-Tariff Barriers to Imports

The UK has comparatively few import licensing requirements. However,
licensing requirements apply to:

 Animals and animal products.

 Plants and plant products.
 High-risk food.
 Veterinary medicines.
 Human medicines.
 Controlled drugs.
 Tissues and cells for human application.
 Waste.
 Products containing fluorinated gas.
 Precursor chemicals.
 Hazardous chemicals.
 Nuclear material.
 Guns, knives, swords and other weapons.
 Weapons and goods that could be used for torture or capital punishment.
 Items covered by some sanctions regimes.

Trade Remedies
 Regulatory Framework
The framework of the UK's trade remedy regime is set out in the Taxation (Cross-
border Trade) Act 2018 (TBCTA). Detailed rules and procedures are set out in
regulations made under the TCBTA.
 Regulatory Authority
Since the UK has left the EU, UK businesses will no longer be able to make a
request to the European Commission to investigate claims of dumping or subsidy in the
UK. The Trade Act 2021 established the Trade Remedies Authority on 1 June 2021. The
TRA's functions include:
Initiating and conducting trade remedies investigations and reviews, and making
recommendations to the Secretary of State for International Trade regarding the
imposition, variation or revocation of trade remedy measures.Providing the Secretary of
State for International Trade with advice, support and assistance in connection with the
performance of certain functions.The TRA replaced the Trade Remedies Investigations
Directorate (TRID) from 1 June 2021.
The TRA has a variety of powers to investigate trade issues. These are set out in
legislation including the TCBTA and certain secondary legislation made under the
European Union (Withdrawal) Act 2018. Secondary legislation sets out in detail how
investigations should be conducted, including the use of questionnaires, sampling,
authentication visits, and hearings.
 REFERENCES

 https://santandertrade.com/en/portal/analyse-markets/united-kingdom/economic-political-
outline
 https://en.wikipedia.org/wiki/Economy_of_the_United_Kingdom#Trade
 http://guide.culturecrossing.net/basics_business_student_details.php?Id=8&CID=215
 https://en.wikipedia.org/wiki/Bombardment_of_Algiers_(1816)
 https://en.wikipedia.org/wiki/Culture_of_the_United_Kingdom
 https://uk.practicallaw.thomsonreuters.com/w-009-5830?
transitionType=Default&contextData=(sc.Default)&firstPage=true#co_anchor_a254492
