International Management: Culture, Strategy, and Behavior 11th Edition by Fred Luthans Solution man

However it has suffered the recurring economic problems of inflation, external debt, capital flight, and budget deficits.
In 2018, Argentina’s currency, the peso, crashed and they were forced to request the largest IMF loan in history – US$50 billion. 
Despite the ups and downs, a major development in South America is the growth of intercountry trade, spurred on by the progress toward free-market policies.
For over 20 years, 90 percent of trade among Mercosur members (Brazil, Argentina, Paraguay, Uruguay, and, until recently, Venezuela) has been duty-free.
At the same time, South American countries are increasingly looking to do business with the U.S.
Mercosur has been in discussion with the EU to create free trade between the two blocs, and Chile and Peru have joined the Asia-Pacific Economic Cooperation group and the CPTPP.
Middle East and Central Asia
Israel, the Arab countries, Iran, Turkey, and the Central Asian countries of the former Soviet Union are a special group of emerging countries.
Because of their oil, however, some of these countries are considered to be economically rich.
Recently, this region has been in the world news because of the wars and terrorism concerns.
Students of international management should have a working knowledge of these countries’ customs, culture, and management practices since most industrial nations rely, at least to some degree, on imported oil and since many people around the world work for international, and specifically Arab, employers.
Africa
Even though they have considerable natural resources, many African nations remain very poor and underdeveloped, and international trade is only beginning to serve as a major source of income.
One major problem of doing business in the African continent is the overwhelming diversity of approximately one-billion people, divided into 3,000 tribes that speak 1,000 languages and dialects.
Political instability is pervasive, and this instability generates substantial risks for foreign investors.
In recent years, Africa, especially sub-Saharan Africa, has had a number of severe problems – tribal wars, AIDS, malaria, and Ebola – resulting in serious economic setbacks.
While globalization has opened up new markets for developed countries, developing nations in Africa lack the institutions, infrastructure, and economic capacity to take full advantage.
Despite these issues, the future potential of many African countries is promising.
A growing number of MNCs are attempting to make headway in this vast continent.
Also, the spirit of these emerging countries has not been broken.
Africa’s economic growth and dynamism have rapidly accelerated in the past two decades.
It is important to emphasize that sub-Saharan Africa’s recent growth, which has been dependent on foreign direct investment and the high level of global demand for commodities, is particularly sensitive to changes in the global economy.
For example, in 2016, low oil prices and China’s economic slowdown stalled sub-Saharan Africa’s growth to a 20-year low and several years later, the region is still recovering from the downturn – see Table 1-12.
Table 1-12 shows economic growth rates and projections for major world regions and countries from 2016 to 2019.
Of note is the fact that a number of emerging regions and countries are growing faster than developed countries; notably, China, India, and other Asian economies.
Table 1-13 ranks the top 10 countries globally on their “competitiveness” as reported by the World Economic Forum – for 2018, Hong Kong and Singapore ranked second and third.
Table 1-14 ranks markets according to several key indicators.
The World of International Management―Revisited
At the start of the chapter, you read about how social media is changing how we connect, shaping business strategy and operations, and even affecting diplomacy.
Having read this chapter, you should now be more cognizant of the impacts of globalization and many international linkages among countries, firms, and societies on international management.
Questions and Suggested Answers
What are some of the pros and cons of globalization and free trade?
Answer: Some of the pros are lower prices, greater availability of goods, increased product and service choices, better jobs, access to technology, improved competitiveness, and overall economic growth. Some of the cons are the offshoring of jobs to low-wage countries; growing trade deficits; slow wage growth; and a lack of responsiveness to the economic, social, and environmental needs of developing countries.
How might the rise of social media result in closer connections (and fewer conflicts) among nations?
Answer: Social media is changing how people connect, business strategies and operations, and even diplomacy. Social media and social networks are revolutionizing the nature of international management by allowing producers and consumers to interact directly and bringing populations of the world closer together. This phenomenon can help break down barriers between people and could even minimize the potential for conflicts between nations. Companies can use social media to circumvent national limitations on advertising that would have traditionally limited their ability to market products in certain nations, and exposure to new products and ideas via social media sites can support grassroots efforts for change in many countries.