1. Countries in Latin America
In the nineteenth century, the French named the western hemisphere as Latin America to cover the countries that used French, Spanish, and Portuguese languages as their official language. The countries in this hemisphere include Brazil, Mexico, Colombia, Argentina, Peru, Chile, Guatemala, Haiti, Ecuador, and Paraguay. Their estimated total population is 617,311,000 according to the research conducted in 2015 projections.
2. Are there good opportunities to do business in Argentina from a multinational enterprise perspective
For any multinational enterprise, there are opportunities in Argentina that a company can decide to invest in. Some of the factors that will attract the investors include the conducive working environment arising from the laws set by the state to govern how other companies from other countries will operate. Another one the available market for the commodities because of the population of that state. Tax rates are also attractive to any investor who may decide to bring their businesses to the country.
In addition, the economy of the country has been on the rise over time making it favorable for doing business. The country’s Gross Domestic Product is quite high, hence, making it possible to introduce a new product into the market. The government also has made it easy for foreign investors to bring their businesses to Argentina with the aim of creating a more- market-oriented economy. In turn, this allows an investor to start a new business in the country.
3. The pros and cons or doing business in Argentina versus Brazil for a Chinese company
Following some facts such as the economy of Argentina being among the best in the Latin countries, it is easy for any company to thrive there. In fact, the country has the third largest economy in the Latin Americas countries after Brazil and Mexico. The advantages that a Chinese company will get from setting up a business in Argentina include its ability to protect the foreign investments recognized by the government. Secondly, there is less competition as compared to Brazil, who have already registered more companies than Argentina. Also, the country allows for foreign direct investments, thus, the Chinese company will have a place to centralize the investments in the country. Lastly, there are other the tax laws set such as every company paying 35% on operating profit to the government.
The cons associated with this set up is mainly the inability of a company to fully acquire its market share following competition from other companies offering the same goods and services.
4. The pro and cons or doing business in Argentina versus Venezuela for a US company
Mostly, the UK companies have dominated the market share of Venezuela with their products believed to be of good quality by the customers. However, some drawbacks may make it hard for any American company to penetrate the market share of the country. First, both the UK and the Venezuelan governments have a signed bilateral agreement to help protect their investments. In turn, this makes it hard for other players to join the pack. Secondly, the country’s market share lacks transparency and has many bureaucracies and exchange controls.
Following this, it is easier for an American based company to operate in Argentina than in Venezuela. The main reason is the dominance by the British companies who have held on to the most significant market share in the country. Lastly, by comparing the tax rates in both the countries, Argentina charges a lower tax on operating income.
In conclusion, Argentina offers business-friendly environment for any multinational enterprise wishing to begin their business. In addition, the Chinese company will be better when its business is in Argentina unlike in Brazil due to ease of gaining the competitive edge. Following a comparison between Argentina and Venezuela, the earlier has a better business environment unlike the later.
- Besley, T. (2015). Law, regulation, and the business climate: The nature and influence of the World Bank Doing Business project. Journal of Economic Perspectives, 29(3), 99-120.
- Hallward-Driemeier, M., & Pritchett, L. (2015). How business is done in the developing world: Deals versus rules. Journal of Economic Perspectives, 29(3), 121-40.
- Stanfill, B. A., Villarreal, A. D., Medina, M. R., Esquivel, E. P., de la Rosa, E., & Duncan, P. A. (2016). Beyond the Culture of Corruption: Staying Ethical While Doing Business in Latin America. Journal of Organizational Culture, Communications and Conflict, 20, 56.