Managing Multinational Operations

Managing Multinational Operations

Introduction

Entering a new country is a lengthy process. It requires analyzing all the factors which can have an adverse impact on the performance of the new entrant. Factors like export duties, labor relations, supplier financing, tax rules all can have a diverse impact on the performance of the Organization. Organizations looking to enter any market have to focus their attention on these factors. These factors are subject to change over time. Thus countries who look for successful entry into new markets are bound to study these factors in detail.

China is a profitable economy for many Organizations. Many Organizations have entered China and are reaping benefits of long term growth. But China as an economy is also facing some challenges which the aspiring Organizations must ponder. The state of the economy and the policies has to be studied carefully since these factors are the force which will be shaping up the success of Organizations in China.

Discussion

Export Restriction

China has placed restrictions on the export of certain products. This restriction strives to discourage exports from major Countries. Organizations are continually suffering and are ignoring China as a market because of these restrictions. American companies have played a major role in contributing to the Chinese G.D.P. Many more companies in USA are looking to enter the Chinese market.

China relies on implementing export duties and quotas on a large number of products. These duties place a burden on the Organization and thus they are discouraged from entering the Chinese Markets. China has been attracting a lot of attention due to its emphasis on export duties and quotas. China is known as a leading producer of all types of materials.

The export duties and quotas contribute to the demand supply gap and as a result the economy suffers. All the Organizations operating in the Chinese market suffer because of these export duties and quotas. Export taxation contributes to the rising prices of industrial raw materials. International prices get hugely increased due to the massive export taxation. Evidence proves that China has been contributing towards industrial goods to a great extent.

Labor Relations

Labor relations have held huge significance in the rich history of Chinese Economy. Countries looking to tap Chinese market have to consider the aspect of Labor relations in China. A lot of emphasis has been paid to restructure the labor relations. The poor state of the economy was due to sub standard labor relations laws (Anonymous, 2012).

Policy makers were quick to realize the significance of poor labor relations laws and thus strived to radically transform the labor relations laws. The modified Labor relations laws have contributed rapidly to the advancement of Chinese Economy as a whole. Economic reform was very necessary for an economy like China.

The goal of economic reform was to put an end to internal political turmoil. Internal political turmoil has largely been responsible for the instability in the Chinese Economy. Attraction of foreign capital is also an important goal of Economic ...