International Business Report: Europe's Economic Landscape Analysis

This report delves into the evolving economic and political climate of Europe, focusing on the rise of nationalism, populism, and protectionism and their implications for multinational enterprises (MNEs). It examines how these factors, including the increasing trend of economic nationalism, populist movements, and protectionist trade policies, impact MNEs' investment strategies, marketing approaches, and overall business operations in Europe. The report analyzes the strategic implications of these trends, such as the need for localization, the effects of political interference, and the challenges posed to free trade. It also explores the impact of Brexit and trade barriers on MNEs. Furthermore, the report highlights the opportunities and risks associated with the rise of these factors, drawing on various sources and reports to provide a comprehensive overview of the current business environment in Europe and its future outlook for MNEs.

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International Business
[Type the document subtitle]
9/25/2019
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International Business 1
Contents
Introduction......................................................................................................................................2
Rise of nationalism, populism or protectionism in Europe.............................................................3
Rise of nationalism and its impact...............................................................................................3
Rise of populism and its impact...................................................................................................3
Rise of protectionism and its impact...........................................................................................4
Conclusion.......................................................................................................................................7
References........................................................................................................................................8

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Introduction
Nationalism, populism and protectionism reflect the economic and political factors of a nation,
which may impact the multinational enterprise investing in the nation. The external environment
plays vital role in the nation and this may imply as the opportunity or threat for a MNE.
Nationalism is a movement and ideology that is characterized through prioritizing particular
nation interest, and thereafter prioritizing the identified interest when compared to other nation’s
interest across the globe (Magalhães, 2014). Populism factor in the nation will reflect the
political stances range which will be focusing over “the people” idea. The protectionism reflect
the economic policy that will be responsible for the import restriction in the nation as compared
to other nations across the globe by methods like import quotas, tariffs on imported products and
government regulation variety. The purpose of the report is to assess the rise of nationalism,
populism or protectionism and the implication of these factors on multinational enterprises
working or willing to conduct business in Europe (Ho, 2014).

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Rise of nationalism, populism or protectionism in Europe
Rise of nationalism and its impact
Nationalism in Europe has been found to be rise since 19th century, where nationalism is found
to be the ideological impetus that has transformed the European market. Ruled by foreign
controlled and Monarchy was shifted two words new family and self-determined national
governments. This has majorly impact MNCs as some of the strategic implications identified for
multinational corporations like Hawaii, Tata group and GE, found requirement to localize the
operations in most of the markets the specifications and design of goods and services may found
to be standardize, Where the actual goods production were found to be more local (Saebi & Foss,
2015). Political leaders are having influence over the percentage of local or global design and
product features. The interference from the political leaders while bringing the companies
investment and employment creation. They were concerned about the contribution in European
nation And not operating in the nation as tourist. Therefore it can be said that the increase in
economic nationalism has found some challenges that has a question about free trade in future,
however it has also adapted with new realities and announcement of retreating globalization
however never a death (thinkers50, 2019).
Rise of populism and its impact
As per the recent trend identified, the evidence suggests that the rise in European populism has
been observed along with the far right parties, with nationalist while making important electoral
gains around the globe. Moreover, the wave considering the populism in the nation is still
increasing and momentum is even gaining. The evidence suggest that considering the populist

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parties increase in Europe, and national rhetoric increase the future perspective of the Europe
include rise in protectionist sentiments and anti-globalization as per the Brexit vote and also in
trump presidency, which have identified the shift among the perception of the common public of
power and role of European union. The key implication on MNE’s include the investment
strategy, it has been found that even after the issues through the risk of populism, like uncertainty
of Brexit which may result into US protectionism and global trade wars (Trivedi, 2016).
However, the investors still consider that the nation is less disruptive as compared to previous
years. The reason being there are not major change for the investors as some of the leading
economic growth indicators like business confidence. Nevertheless, it has impacted through the
recent changed noise volume and some interference is supporting the opaque the signal.
Moreover the populism increase in Europe is not considered as investable theme for the MNE’s.
Interest rate and the corporate profit are the major path that is really mattering to the MNE
investors primarily (reuters, 2019).
Marketing strategist reflected that the rise in population maybe warning to the investors when it
comes to providing conclusion on political trends that have specifically found to be against
healthy global economy that has found to be backdrop that the MNEs are experiencing currently.
Other than political unrest, the opportunities of investment are also taking. However the
marketers reflect that remaining opportunity through the economic cycle rest which has depicted
that the European companies profitability has been left behind when compare to United States
(Ding, 2018).

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Rise of protectionism and its impact
As already discussed protectionism is found to be rise in Europe in area which is because of the
economic implications. The key reason for this implication is due to imbalance in import and
export, because of which the government implies restriction on import of the products. This may
result in to increase in export and decrease in import which will eventually balance the deficit.
However the rise of this implication me also home activity and trade. The key reason being there
is a broad consensus between both the economist and net benefits of open trade and the
requirement to overcome the negative in fact that it implies on the society in group of people.
Nevertheless trade barriers that are raising protectionism are not considered to be a solution for
the latter. Trade integration reversing may impact on net income gain’s risk that has been
generated. Through unraveling investment linked and closure create long-term benefits, that our
retreating into protectionism could also be helpful to global financial markets that are unsettled
(Read, 2013).
Evidence from European commission’s report published in June 2019 reflect rapid rise in foreign
market barriers that has impacted European companies working in foreign markets. However it
has been identified that 123 such foreign market barriers has been removed that have allowed
additional export of more than €6 billion in 2018. However trade and investment barrier report
with latest addition has reflected 45 trade barriers that were introduced in nations other than
Europe in 2018. This can adversely affect the multinational corporations working in Europe as
the implication of protection as may increase the export but the import can be impacted which
will eventually disturb conduct of business for MNEs (ecb.europa.eu, 2019).
The rapid rise in protectionism in Europe reflects that a large share of global trade is
progressively affecting the trade distortion. As per the evidence from global trade alert data base

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presented in 2017, it has been identified that G20 countries have been exporting 50% which was
harmful trade measures subject as it was 20% in 2009. The trade growth has found to be
extensively decelerated in the sectors where discriminatory measures are found to be adopted,
when compared to gain advantage from trade liberalization. The risk associated that is perceived
with open trade has considered being one of the aspects in list of concerns while studying
globalization. For instance free trade at times had found to be resultant two more vulnerable
conditions for some countries in international crisis that is provided distributional consequences.
Moreover rising inequality is another factor that has been found duty free trade within and across
the nation. However they are found some of the advantages of increasing protectionism within
and across the nations. Therefore it can be said that the protection is the can be advantages for
the economy and MNE’s in the nation (trade.ec.europa, 2019).

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Conclusion
From report the key findings included that the rise of Rise of nationalism, populism or
protectionism in Europe has some challenges and impacted European economic condition as well
as the MNE’s to conducts business like restricting import that eventually effect business in
Europe, increase in open trade due to globalization, and populism has impacted through the
recent changed noise volume and some interference is supporting the opaque the signal.

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References
Ding, K., 2018. Platforms, innovation and capability development in the Chinese domestic
market. The European Journal of Development Research, pp.1-16.
ecb.europa.eu, 2019. The economic implications of rising protectionism: a euro area and global
perspective. [Online] Available at:
https://www.ecb.europa.eu/pub/economic-bulletin/articles/2019/html/
ecb.ebart201903_01~e589a502e5.en.html#toc4.
Ho, J., 2014. Formulation of a systemic PEST analysis for strategic analysis. European academic
research, 2(5), p.6478.
Magalhães, P.C., 2014. Government effectiveness and support for democracy. European Journal
of Political Research, 53(1), pp.77-97.
Read, G., 2013. A political, economic, social, technology, legal and environmental (PESTLE)
approach for risk identification of the tidal industry in the United Kingdom. Energies, 6(10),
p.5023.
reuters, 2019. european-populism-is-not-yet-an-investable-theme. [Online] Available at:
https://www.reuters.com/sponsored/article/european-populism-is-not-yet-an-investable-theme.
Saebi, T. & Foss, N.J., 2015. Business models for open innovation: Matching heterogeneous
open innovation strategies with business model dimensions. European Management Journal,
p.201.
thinkers50, 2019. future-mncs-era-economic-nationalism-robust-different. [Online] Available at:
https://thinkers50.com/blog/future-mncs-era-economic-nationalism-robust-different/.
trade.ec.europa, 2019. Barriers to trade: as protectionism rises, EU continues opening up export
markets for European firms. [Online] Available at:
https://trade.ec.europa.eu/doclib/press/index.cfm?id=2032.
Trivedi, M.K., 2016. PESTLE technique–a tool to identify external risks in construction projects.
International Research Journal of Engineering and Technology (IRJET), 3(1), pp.384-88.