Which sectors or companies provide significant investment opportunities?

For this project, you are asked to write a comprehensive report on the business environment in a particular country. In your analysis, take the perspective of a U.S. investor or U.S.-based firm. The project objective is to develop an understanding of the business culture and the process of doing business in a foreign country.

This project is not designed to be a term paper in which the views of others are simply summarized. You are the analyst, and it is your job to integrate relevant information and to form your own opinions and views. And you will need to place yourself in the position of a manager responsible for expansion into a new country and business environment.

This project will require you to analyze data. Potential data sources for the project are available at the end of this assignment.

In order to provide a comprehensive analysis of the business environment in your country, each report must address the factors listed below. The analysis should cover the last five years, or as constrained by information limitations.

The primary focus should be on more recent events (Present to 2 years).

1. Important Events and Country Background (General Background):
In this section your group should review general background information concerning your country (i.e., location, size, population, resources etc …). This section should include a brief time-line of the main historical events. Basic economic and financial market issue should include such as issues as monetary policy, exchange rates, sovereign debt or defaults, or other import market background. This analysis should not exceed two pages.

2. Political Structure and Stability
Provide a brief description of your country’s political structure and its stability. Discuss important recent political events and political risk ranking indicators. Do these recent events represent a structural change? Be sure to also carefully cover political risk ranking measures for your country. This analysis should not exceed three pages.

3. Doing Business Analysis
One of the key issues a firm has when it enters a new market is the ease of doing business in this new market. In this section provide a detailed analysis of the business environment in the country you have selected. This analysis should look at macro issues related to the legal framework, ease of entry into the market, and rules and regulations applying to foreign owned firms including ownership rules and repatriation of profits from the foreign country.
At the micro level examine the ease of starting a business, registering property, dealing with construction permits, getting electricity, employing workers, and paying taxes. These factors interact for time and cost to start and run a business and help to shape the local business environment. Another set of important factors for the business environment are related to the legal and practical issue related to getting credit, protecting investors, enforcing contracts, and resolving insolvency. As the main interest of this country analysis your group should consider the ease of trading across borders and international financial transactions.

4. Business Culture Analysis
In this section provide an overview of the business culture of the country chosen. Using Hofstede’s measures on business culture, the GLOBE study, and the World Values Study and other country level data provide an analysis of the business environment and local conditions. Foreign chambers of commerce and the US Commercial regularly provide information on the local business culture. Check their publications that focus on the local business experiences of foreign firms and workshops of doing business in the country your group has chosen.

5. Competitiveness and Innovation Potential
Provide an overview of the country level competitiveness. Utilizing Porter’s Diamond of National Competitiveness framework list the country’s factor endowment, the existence of related and supporting industries, national level demand conditions, and the structure and rivalry inherent in the national marketplace.
Provide an analysis of the country level competitiveness as measured by the World Economic Forum. This analysis should include how the country fares with regard to the current pillars of competitiveness identified by WEF and how trend in competitiveness at the national level. Highlight competitive advantages the country has along with those areas where the country lags significantly behind.
The third part of this section should include an analysis of the innovation potential of the country. Sustainable competitiveness depends on innovation and when a firm decides to enter and invest into a country its innovation system plays a role it is long term success by facilitating local innovation and value creation. The analysis of the country level innovation competitiveness may be based on national level indicators of innovation including expenditures on research and development, the rate of domestic and international patenting, resources and infrastructure provided by government to support innovation.

The INSEAD – Cornell – WIPO Global Innovation Index provides a comprehensive database of innovation indicators and country level analysis and provides an excellent resource for understanding innovation at the country and regional level.

6. Future Outlook and Investment Opportunities
In the final section your group should integrate your analysis of country level factors related to the business environment and develop a future outlook. In this section analyze the present and historical performance of your country’s financial markets including both equity and debt markets and the foreign exchange market. In this section you should include financial and political risk.
This section should provide a clear picture of the future outlook, investment opportunities, and how a US firm should approach, enter and operate in the market. The types of questions that should be consider include the following:
What are the near future performance prospects?
Which sectors or companies provide significant investment opportunities?
What are your investment recommendations?
How should a firm do business in the country?
In answering these questions examine the business climate, political, economic, financial, innovation and competitiveness conditions of the country under study.

Each report should be organized as follows:
1. Executive Summary: A brief summary of the major findings in the body of the report, including specific recommendations and associated details. Under no circumstances should this exceed one single-spaced page. Note: Do not include this page as part of the 20 page report limit.
2. Body: Make sure that you thoroughly address all six categories of questions.
3. Bibliography: List complete references of the material you actually used in the report.
4. Appendix: Data, tables, graphs, equations and calculations to support your arguments should be placed here. Tables and graphs must be labeled properly. DO NOT attach random computer runs and data. DO NOT include any material that you do not refer to in the analysis section! Restrict your appendix to relevant parameters.

Data/Information Sources
Below you will find some potential data/information sources.
World Economic Forum – www.wef.org
Global Innovation Index – www.globalinnovationindex.org
Doing Business – www.doingbusiness.org
The Hofstede Center – http://geert-hofstede.com/
World Values Survey – http://www.worldvaluessurvey.org/wvs.jsp
GLOBE study – http://www.sagepub.com/booksProdDesc.nav?prodId=Book226013
Global Edge – http://globaledge.msu.edu/
Financial Times – www.ft.com
The Economist – www.economist.com
Bloomberg – www.bloomberg.com
US Commercial Service – http://www.trade.gov/cs/
US Chamber directory of international US chambers abroad – https://www.uschamber.com/amcham-directory
World Trade Organization – www.wto.int
World Bank – www.worldbank.org
International Monetary Fund – www.imf.org
World Intellectual Property Organization – www.wipo.int
International Trade Center – www.intracen.org
European Union – www.europa.eu.int/
European Central Bank – www.ecb.int/
Bureau of Economic Analysis – www.bea.doc.gov
Bank for International Settlements – www.bis.org
Organization for Economic Cooperation and Development – www.oecd.org/
American Countertrade Association – www.countertrade.org
Export-Import Bank of the United States – www.exim.gov

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