MODULE 0

ANALYZING A COUNTRY AS A BUSINESS UNIT (HUGE CORPORATION)

International Economic
Environment
Analytical Framework

• “Sectorization” of a country
• 3 key indicators: GDP, unemployment rate, inflation
• Other indicators
• Solvency (balance sheet & income account)?

International Economic
Environment
Aggregation scheme for the national economy
Financial entities
Financial sector Central Bank

Independent
(monetary policy)

Government
(fiscal authority)
Non-financial sector
Households & non-
External sector financial corporations

DOMESTIC ECONOMY
International Economic
Environment
Economic Performance: Income/Spendings?

COUNTRY BALANCE SHEET

cosas
Assets buenas Liabilities

Natural Resources (comp. Adv) National wealth

Capital (l,k) Domestic Assets owned by
Innovation – tech knowledge (IP, patents..) foreigners (ie. Chinese
Institutional setting companies in Spain)
Assets owned in other countries

International Economic
Environment
Examples
Analyze these countries as a business unit:
• Spain
• US
• China
• Germany
• Hong Kong
• Zimbabwe, Venezuela, Argentina

International Economic
Environment
Identifying business opportunities from the comparative analysis of
countries

What does the your country do/produce best?

MATCH!
What is another country lacking or in need of?

Is the match possible/achievable? Look out for relevant obstacles:

• Existence of bilateral agreements (FTA)
• Tariffs, Customs
• Other restrictions (currency, international blocking…)

International Economic
Environment
Global Trends
GLOBALIZATION
Increasing FTAs globally, stronger global networking

GLOBAL MULTIPRODUCTION
A good is now produced globally in different stages (international traceability) – this
means that a ”more open” economy (fewer tariffs, more FTAs…) is more likely to be
part of this worldwide production line

EVOLUTION OF THE MIDDLE CLASS AND MIGRATION OF THE ECONOMIC POWER

TO APAC

International Economic
Environment