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Doing Business in the Developing Countries - Coggle Diagram
Doing Business in the Developing Countries
Classification of the Developing Countries
least developed countries
underdeveloped countries
Third-World economies
The World Bank the countries into four major groups, using the criteria of income per capita
low income
middle income
upper-middle income
high- income countries
UNDP has developed more accurate index for measurement of the level of socio-economic development.
“Human Development Index” (HDI) which incorporates economic and non economic indicators
HDI index is the most appropriate one for the objectives of the business environment research and the selection of suitable business entry strategy
The education is of critical importance for the qualification of the labor force
HDI allows comparing the possible interdependencies between those indicators.
The GDP per capita indicator must not be used as a single indicator when assessing the perspectives on market and investment opportunities
The developing countries can be categorized in correspondence with their structural differences.
Size of the country
endowments with natural resources
human resources and their characteristics
economic structure
political structure and degree of dependence
Cultural and Political Factors
variety of religions, languages, historical roots, ethnic groups, beliefs
When it comes to business negotiations, marketing research, or contracting, the knowledge of the appropriate language must be at a professional level
Entry Strategies in the LDCs
Direct exporting/importing
Indirect exporting/importing
Licensing
Off-shore production (direct investments)
Subcontracting
Portfolio (indirect) investments
economic outcomes from the regional economic cooperation between the developing countries
Economies of scale
Lower costs on export/import
Lower costs on export/import
Easier and more efficient interaction with the international organizations and institutions
Better allocation of capital
Coordinated economic policy
Stronger competition and stimulus for technological and product
innovations
Higher economic growth