International Business Environment: Implications of Globalisation and Political Factors

This essay analyzes the implications of globalisation and political factors in the international business environment. It focuses on the case of Marks and Spencer plc and the impact of globalisation on the Philippines. It also discusses the need for businesses to monitor the political environment.

INTERNATIONAL
BUSINESS ENVIRONMENT

INTRODUCTION
International business environment is considered as the multidimensional and consists
cultural differences, political risks, legal and taxation problems, exchange risk and etc.
Moreover, this comprises the political, economic, regulatory, social, cultural and technological
environments (Introduction and Types of International Business Environment (IBE), 2019). It
benefits participating parties and countries with high levels of international trade that has
stronger economies, effective living standards as well as steadier growth. The business
environment is defined as the sum or collection of internal as well as external factors which
influence firms. It includes clients, suppliers, and innovation in technology, staff and others. The
chosen company for this presentation is Marks and Spencer plc, which is a growing British
multinational retailer. It deals in clothing, luxury food products and home products. This essay
will critically analysis the implication of globalisation and international trade. Moreover, assess
the political environment and analyse why business needs to monitor this environment.
GLOBALISATION
Globalisation is considered the market integration into global economy which leads
towards enhanced interconnectedness of national economies (Apăvăloaie, 2014). The
marketplace in which this is specifically important involves financial markets like capital market,
insurance market and so on. Commodity market includes market for coffee, oil etc. Moreover,
globalisation is considered as the growth of international trade, investment, technology as well as
information across the world. Also, it is the merge of whole Asian countries with one another.
Herein, technology is refers to be the biggest factors of globalisation. So the advanced as well as
modern technology can assists all nation to access borders and top enhance the economic
development of whole country.
The Philippines is a South-east Asian country within Western Pacific. It is famous for
their waterfront promenade as well as is the heart of old Manila. In Philippines, globalisation
bring various job opportunities to Filipino people. The government motivates internalisation
organisation to set up its businesses as well as open several job to Filipino employees at
marketplace. The impact of globalisation assists the community of Philippines to become more
aware of what are happening in other countries by providing employment opportunities to people
in proper manner. They create awareness programmes for their people to know about impact of
globalisation.

Within Philippines, globalisation is crucial upon how it works into economy as well as
advancement of technology. It assists all country to have a cooperation for helping one another
and be united. Also, this is developed for procedures of products, services as well as individuals
around the world. Moreover, this is helpful for developing all country to improve international
economy as well as enhance the respective country's income level. In addition to this, it means to
liberalize every county its rule and regulation to comply, individuals may enter to various
country as long they obey their country's legislation in order to operate into particular nation in
effective and efficient manner. Globalisation is efficacious for Philippines as it helps to develop
international and domestic countries, culture, education and improvement of economy. This can
assist the country to enhance the employment of Filipino individuals due to the opportunities
which various international countries have to set up their businesses there, as well as several job
vacancies for Filipino and recruit various individuals to perform at its organisation (Savrul,
Incekara and Sener, 2014). As there are lot of overseas Filipino employees who perform globally
as well as can be successful in doing work in international country. Due to World Trade
Organisation of nation, all individuals can perform into various country as well as has
opportunity to live there and be a citizen within country they live in (Belás and et. al., 2014).
Moreover, this develops the information technology flows as the impact of globalisation within
Philippines technology brings more positive affects as this assists to enhance respective country
economy. This leads in providing employment opportunities to enhance their living standard and
live happy life. Due to the IT with modern as well as latest usages develops the flows of whole
firm products as well as also this reduces the work of each Filipino. Also, globalisation
developed the products and services quality, as being connected to another country is effective
for respective country. This assists them to perform good quality as well as provide great
services to them so that they can bring dignity to Filipino individuals. Developing its services
and facilitates more quality products to another countries can develop Philippines and their
nation. They can provides effective quality goods outside countries as well as Filipino
individuals can serve its best to other. So, due to globalisation the goods services as well as
products can easily provide and deliver that to every respective location. All these shows that the
globalisation impact the Philippines positively.
In addition to this, globalisation can also impact the country negatively. As this is not
effective for exporting rice product into agriculture industry, because Filipino farmers can

generate more rice if their government will assist them to facilitate advance technology to
produce more grains quarterly. Also, due to this Filipino living standard, get affected in negative
manner as few moral values has been forgotten by them and become more familiar with the
Western mentality (The Impact of Globalization in the Philippines, 2018).
Philippines restrict international trade by implementing rules and regulations of RA No.
11203 as included into Joint Memorandum Circular (JMC) 01-2019 which was approved on 5th
March, 2019. Approx. 350,000 ton of rice TRQ will be levied a 40% duty. Apart from quota
tariffs are at 180%. Levied excise tax on imported as well as nationally generated distilled spirits
regardless of raw material utilised is composed of uniform ad valorem tax as well as specific tax
such as ad valorem tax equivalents to 20% of net retail price and many more. Also, import
regulation for processed food products as Philippines food regulations usually comply U.S food
as well as drug administration policies as well as guidelines for effective practices of
manufacturing, food additive and packaging suitability materials for food usages. Whole
products of food that is offered for sale into respective countries should be registered with
(FDA). Registration of imported products may only be undertaken through Philippines firms,
although few documents and for specific kinds of goods, samples required to be facilitated
through exporter. As a result, overseas sales of respective products in August raised through
3.089% year by year to $ 6.163 billion, outstripped through an 11.034% hike into value of
inbound international goods to $9.677 billion. The outcome of $3.513 billion deficit into trade
within goods was 28.39 % higher than $2.737 billion recorded previous year (Philippines - Trade
Barriers, 2019).
POLITICAL ENVIRONMENT
The political environment is considered to be the state, government as well as their
institution and regulations, private and public stakeholders who perform or influence the system.
The political surroundings have to be stable for organisations in order to operate successfully
(Cadle, Paul and Turner, 2014). The Philippines is known as a multi-party presidential republic.
This is a republic which means democracy with presidential form of government in which power
is equally divided between three branches that are executive, legislative as well as judicial. The
president is both the head of the government and the state. They are elected through popular
votes to serve a single mandate of six years. It holds executive power that involves
implementation of law within county as well as running daily affairs (Savrul, Incekara and Sener,

2014). Also, the legislature into respective country is bicameral, the parliament called congress.
It has power to veto acts of legislation as well as in turn a super-majority of legislators may act to
override veto. Respective country have a multi-party system as well as political parties generally
has diverse ideologies.
The largest political parties within Philippines are the liberal party and nationalist party.
Moreover, the role of the government in this country is to formulate legislation, regulations as
well as repeal them by the power vested into Philippines congress. Also, to settle controversies
including rights which are legally enforceable as well as demand-able (Epifanova and et. al.,
2015). Legislative branch enacts laws, rejects or confirms appointment of presidents as well as
have the authority to declare war. The companies like Marks and Spencer are expanding their
business of food products into Philippines as its economy is very promising with a lot of
opportunities to grow. Performing businesses can be tricky things to manage without the
assistance of a few local experts or without any business base.
Philippines have the 12th largest population and the 43rd largest economy in the world.
Before expanding their business Marks and Spencer need to monitor the political environment as
this can impact the business in various ways. This can involve risk factors, therefore the
organisation has to be ready for dealing with national as well as international politics. As the
political system is different in various areas such as interest rate, inflation, it can affect the
company differently (Mithas, Tafti and Mitchell, 2013). Therefore, the regulations of the
Philippines can impact which products can or cannot be exported, imported as well as sold
within the stores. As Marks and Spencer will be expanding their business, the organisation will
have to comply with the rules and regulations of the country, as well as with the health and
safety guideline which is established through government. If they do not comply with the rules,
then not only that the products will get out from the market, but the organisation may face legal
problems.
As discussed above, Marks and Spencer needs to adapt and comply with regulations,
otherwise they will not able to perform their business effectively and efficiently. They have to
certify their food items with Food and Drug Administration or Bureau of Food and Drug.
Moreover, the company has to issue a certificate of product registration which shall be issued
through FDA (Food and Drug Administration) which will be valid for two years. This is
advantageous for the respective company as this gives them the right to perform the business, but

can also include various procedures registration and that can sometimes be a problem (Groşanu
and et. al., 2015). If the registration expires and it does not get renewed, they will have to face
the difficulties related to political government policies such as foreign trade policy. In this case,
they cannot supply product to other countries.
After the restoration of democratic system, the government in Philippines has introduced
new political reforms and this lead to the organisation to be more aware about their rights as well
as accountabilities. So, respective organisation has to adopt the new system which help them to
operate their business in innovative manner but if not adopted then the strict action will be taken
through the government of respective country (Gupta, 2013). This will be not effective for Marks
and Spencer business of food products.
CONCLUSION
As per the above presentation, it has been concluded that business environment is
essential as this assists realistic plans as well as assure its efficacious implementation. Moreover,
this is also useful in identifying the opportunities as well as threats. Also, the globalisation plays
vital role into the development of country's economy and impacts the country positively and
negatively.
In a positive way, this enhances employment, living standard and many more. In negative
manner, Filipino people adopting the western culture forgetting their own values and so on.
Country encourage and restrict the international trade through implementing various regulation
and policies related to trading such as export and import. Philippines is a republic with
presidential form of government in which power is equally divided between their three branches
that are executive, legislative as well as judiciary. In addition to this, it is also summarised that
organisation have monitor the political environment as this help them to about country's political
condition as well as perform or work accordingly.

REFERENCES
Books and Journals
Apăvăloaie, E. I., 2014. The impact of the internet on the business environment. Procedia
Economics and finance. 15. pp.951-958.
Belás, J. and et. al., 2014. Significant attributes of the business environment in small and
meduim-sized enterprises. Economics and Sociology.
Cadle, J., Paul, D. and Turner, P., 2014. Business analysis techniques. Chartered Institute for IT.
Epifanova, T. V. and et. al., 2015. Modernization of institutional environment of
entrepreneurship in Russia for development of innovation initiative in small business
structures.
Groşanu, A. and et. al., 2015. The influence of country-level governance on business
environment and entrepreneurship: A global perspective. Amfiteatru Economic
Journal. 17(38). pp.60-75.
Gupta, A., 2013. Environment & PEST analysis: an approach to the external business
environment. International Journal of Modern Social Sciences. 2(1). pp.34-43.
Mithas, S., Tafti, A. and Mitchell, W., 2013. How a firm's competitive environment and digital
strategic posture influence digital business strategy. MIS quarterly, pp.511-536.
Savrul, M., Incekara, A. and Sener, S., 2014. The potential of e-commerce for SMEs in a
globalizing business environment. Procedia-Social and Behavioral Sciences, 150,
pp.35-45.
Online
Introduction and Types of International Business Environment (IBE). 2019. [Online]. Available
Through:<https://enterslice.com/learning/international-business-environment-ibe/>
Philippines - Trade Barriers. 2019.[Online]. Available
Through:<https://www.export.gov/article?id=Philippines-Trade-Barriers>
The Impact of Globalization in the Philippines. 2018. [Online]. Available
Through:<https://lookupgrade.com/en/blog/english-the-impact-of-globalization-in-the-
philippines/>