Global Business Environment: Trump's Policies and Emerging Markets

This report provides an in-depth analysis of the global business environment, examining the impact of President Trump's economic policies on foreign economies like the UK, EU, and China, highlighting potential trade wars. It also explores the opportunities that emerging economies present for global business expansion, supported by examples such as Starbucks in India, Jaguar Land Rover, Heinz, Diageo, Rezdy, and Innocent Drinks. Furthermore, the report explains how governments utilize fiscal and monetary policies, including expansionary and contractionary approaches, to stimulate economic activity and growth, aiming to maintain low inflation and employment rates. The conclusion emphasizes the interconnectedness of economic policies, business expansion, and government strategies in shaping the global landscape.

Global Business
Environment

Table of Contents
INTRODUCTION ..........................................................................................................................1
Q1 How President Trump’s approach to economic policy impacts upon foreign economies
such as the UK or EU or China?............................................................................................1
Q2. Discuss and interpret how emerging economies are presenting opportunities for global
expansion for businesses using examples to illustrate your work..........................................2
Q3.Explain, using examples from your own research, how Governments use both fiscal and
monetary policies to stimulate economic activity and growth using trickle-down economics...3
REFERENCES................................................................................................................................5
Books&Journals.....................................................................................................................5

INTRODUCTION
Global business environment makes international trading more convenient and easier. It
will help business entities in enhancing their overall productivity in a business environment
(Sassen, 2016). In this report, how Trump's economic policy can effect China and Europe's
economic condition, how emerging economies helps business entities in expanding their business
operations will be discussed. In addition to this, how government should use fiscal and monetary
policies in order to stimulate economic growth will also be covered.
Q1 How President Trump’s approach to economic policy impacts upon foreign economies such
as the UK or EU or China?
The victory of Donald Trump in general election has begin transition period in United
States. In this regard, Donald Trump formulated various economic policies in order to change
foreign economies. From past few years US is facing negative trade balance, which indirectly
effects its overall government spending. In this context, Donald Trump has formulate strict tariff
restrictions regarding import and export of goods to developing countries that will eventually
effect UK and China economies. After this policy, various multinational organisations of
developing countries are planning to relocate their production facilities.
In this regard, the economic trade policy formulated by president of Unites States will
directly effect economic condition of China as they are generating most of their revenue by
exporting goods to United States. On the other hand, China is planning to have short term
contract with US government in order to maintain their trade relation with United States. This
policy will effect overall GDP of China as well as UK or EU as there will be strict rules and
legislations regarding export of goods to United States.
This economic policy of United States will directly benefits its workers and GDP growth
for short term. In addition to this, Donald Trump is also planning to reduce immigrants,
individual and corporate tax reform and patient protection act. This new tax policy will slightly
increase economic condition of United States.
These policies will help US in improving their economic condition but will harm the
trade condition of the whole nation for a longer duration. This will create a trade war situation
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among UK, EU and China. It is a situation in which countries attacks each other's trade with their
taxation policy (Gilpin, 2016).
The economic policies of Donald Trump will also effect its relation with Europe as
president has formulated strict rules regarding European companies who are doing business with
Iran. In this regard, president of United States already made a announcement to fuelled oil prices,
which will create uncertainty for European companies who are operating its business activities
both in Iran and US. After this economic policy most of the European companies has stop doing
business with Iran.
From the above mentioned scenario, it has been analysed that Donald Trump's economic
policies will effect economic conditions of both EU or China. This will only benefit United
States workers and in improving its GDP but only for short period of time, but it will effect
economic sustainability of whole nation. In this regard, it is essential for United States to come in
a appropriate contract with Europe and China in order to facilitate ethical trade practises.
Q2. Discuss and interpret how emerging economies are presenting opportunities for global
expansion for businesses using examples to illustrate your work.
Emerging economies: It is defined as nation's economy which is leading towards
becoming more innovative and advanced in terms of industrialization and growth. It has few
characteristics of developing market but do not satisfy certain standards so that it can be referred
as developed country (Young, Hood and Hamill, 2017). Emerging markets have above-average
socio political unreliability, low per-capita incomes, lower level of business activities and high
rates of unemployment but they have high growth rates of economy. Global manufacturing
operations have became important base for emerging markets and they are also benefited by
cross-border trade, loose monetary policies and regulatory reforms. These economies have to
face high risk as stocks can be quite elusive. As these markets are expecting higher growth in
terms of sustainability, they tends to provide high capital investment with respect to income
opportunities. In short, it can be used to describe or analyse process of industrialization and rapid
growth.
Emerging market help economies to make transition, develop tertiary and secondary
sectors, enhance potential to be a develop economy and struggle involved in being a global
market. Employment options will be increased which will benefit both individuals as they will
have options for growth and organisation can also have benefit in terms of increased productivity
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and profitability. Relationship between different countries can be improved. Customer
understanding is required for implementation as it requires three key areas, they are strong value
propositions, smart localisation of manufacturing and robust supply chain (Gay, 2016). This has
provided opportunity to countries to collaborate with other countries and helped other countries
and themselves to grow both in terms of expansion and revenue. Few examples of expansion of
emerging markets are discussed here:
1. Starbucks have revealed its plan to open its first outlet in India in 2012. It is US based
and would open 50-50 joint venture with Tata Global beverages in India. It has around
17000 cafeterias in around 50 nations with 6000 cafeterias outside United States.
2. Jaguar Land Rover has opened its first assembly or manufacturing plant in India in 2011.
It deals with assembling of of car kits which are shipped or imported from JLR's plant at
Halewood in United Kingdom. Key driver of investment is taxation. Indian market or
federal government has levied 100% tax on imported vehicles but parts which are
developed in India are given 10% import tax.
3. Heinz expanded in 2010 in China by adopting Foodstar which is starring maker of sauce
for $100m. In 2011 Heinz has bought 80% of stakes of Quero which is leading brand of
sauce in Brazil. 20% of more sales were generated in 2012 and 16% more in 2011.
4. Diageo has finalised to get baijiu brand Shui Jing Fang so that it can expand and create a
footprint in china. $950 is offered by them so that it can be used to develop market for
Chinese.
5. Rezdy which is a American company dealing in providing software designing related
services to their customer is planning to expand their business activities in Asian market.
6. Innocents Drinks, which is a leading smoothie company in UK and 13 other countries
including Europe will also be planning to launch its business in Asian market.
Q3.Explain, using examples from your own research, how Governments use both fiscal and
monetary policies to stimulate economic activity and growth using trickle-down
economics.
The main aim of fiscal and monetary policy is to improve economic cycle of a nation and
also to target low inflation rate (Sun and Zhou, 2018). They both can be used in maintaining
positive economic growth and to keep low inflation rate. In this context, governments can use
both fiscal and monetary policies in order to retain economic sustainability of a nation.
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Fiscal policy refers to the government spending and taxation policy used by governments
in order to balance economic condition of a nation. This policy is used alongside monetary
policy with a motive to manage interest rates and supply of money. The main aim of fiscal policy
is to maintain employment rate, increase economic growth of a particular nation and also to keep
wages and prices stable. In this regard, there are two types of fiscal policy i.e. expansionary
fiscal policy and contractionary fiscal policy, which can be used by government in order to bring
economic sustainability. In expansionary fiscal policy, government reduce taxes and increase
government spendings in order to stimulate economic growth. In contractionary fiscal policy,
government raises taxes and slow economic growth in order to control inflation.
Monetary policy refers to influencing demand and supply of money primarily with the
use of interest rates. The main objective of this policy is to maintain inflation rate and
unemployment rate of a particular nation. In this regard, government authorities uses monetary
policy to reduce recession by using another tools for increasing liquidity of a nation. In addition
to this, this policy is also used by government in order to maintain predictable exchange rates
with other countries.
As per the above mentioned scenario, it has been concluded that both monetary and fiscal
policy are used by the government together in order to improve economic condition of a
particular nation. These policies will help the government in maintaining employment rate,
interest rates and also to maintain recession. For example, president of United States has
formulated strict tariff rules and regulations regarding export and import of goods in US from
countries like China and Europe. This policy was formulated in order to improve economic
condition of a nation as United States is facing negative trade balance from past few years. In
this regard, fiscal and monetary policy are formulated together with a motive to balance
economic condition of United States. In this context, government authorities frequently changes
monetary and fiscal policies in order to continuously improve economic cycle of a particular
nation. At the time of specific circumstances as mentioned above, government takes strict
measures regarding monetary and fiscal policy to maintain economic situation of a nation.
CONCLUSION
From the above mentioned report, it has been concluded that economic policies will
effects the economic condition of a whole nation in both positive or negative perspective. In
addition to this, emerging economic operation also help business entities in expanding their
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business operations effectively. Along with this, monetary and fiscal policy used by government
with a motive to maintain employment rate, interest rate and exchange rate with other countries.
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REFERENCES
Books&Journals
Sassen, S., 2016. The Global City: Strategic Site, New Frontier. In Managing Urban
Futures (pp. 89-104). Routledge.
Gilpin, R., 2016. The political economy of international relations. Princeton University Press.
Young, S., Hood, N. and Hamill, J., 2017. Foreign multinationals and the British economy:
Impact and policy. Routledge.
Gay, R. D., 2016. Effect of macroeconomic variables on stock market returns for four emerging
economies: Brazil, Russia, India, and China. The International Business & Economics
Research Journal (Online). 15(3). p.119.
Sun, H. and Zhou, C., 2018. Monetary and fiscal policies in a heterogeneous‐agent
economy. Canadian Journal of Economics/Revue canadienne d'économique. 51(3).
pp.747-783.
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