Country Comparison Essay Example

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    Business
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Country ComparisonCountry Comparison 1

BSBMKG516B -Profile International Markets

ASSESSMENT 1B : THREE COUNTRY COMPARISON(September, 2013)

NAME OF STUDENT: ___________________________________ STUDENT ID: _________________________ GROUP: _____________

COUNTRIES: 1. Australia 2. MALAYSIA 3. United Kingdom

ELEMENT

PERFORMANCE CRITERIA

S/U

Select potential international markets for further investigation

List potential international markets for further investigation

Identify information sources to inform process for selection of international markets

Determine and document criteria to determine suitability of international markets for product or service

Access and use information sources to determine suitability of international markets for product or service to be marketed

Select international markets for profiling

  1. Type the country name at the top of each of the 3 wide columns.

  2. Fill in the data for each country, for each question.

  3. Rank the three countries from best to worst, for each question, with the best country scoring a “1”, and the worst country scoring a “3”.

  4. Write a comment for each section in the box provided.

  5. Write the score from 1 to 3 in the relevant column for each question.

  6. Calculate the total score for each country at the end of each sub-section.

At the end of the document, calculate the OVERALL TOTAL SCORE for each country. Which country is the best for starting a new business in? Rank the countries in first, second and third position, on the table provided.

CRITERIA

COUNTRY 1 DATA (Australia)

COUNTRY 2 DATA (Malaysia)

COUNTRY 3 DATA (UK)

BASIC COUNTRY DATA

Developed (Advanced), Emerging, or Undeveloped (Developing)?

Australia is a developed country. This is because it is one of the wealthiest countries being ranked as 12th in the world economy. It is ranked as number five in the level of per capital income globally.

http://scottjhiggins.com/australia-is-a-developing-country-too-on-development/

Malaysia is a developing country with medium sized per capital GDP. The country is likely to become a developed country in 2020 because of its high investments and stable economy. It is among the 10 top developing countries according to the GPD of the developing countries.

http://www.pmo.gov.my/dokumenattached/Dasar/NIP.pdf

UK is a developed country. It was the first one to get industrialized. It has a human development index of 0.94 according to 2006 statistics.

http://www.economicsonline.co.uk/Managing_the_economy/Economic_development.html

Coface Country Risk Rating

(A,B,C,D)

Australia is rated at 12 in 2013 in Asia. This shows that Australia is a risky continent, though the risk is not extreme.

http://www.developingfinance.org/download/COUNTRY-RISK-ASSESSMENT-2013/4.%20Country%20Risk%20Rating%202013.pdf

Malaysia is rated at 31 in Asia in 2013. This is a clear indicator of Malaysia being a very risky country

http://www.developingfinance.org/download/COUNTRY-RISK-ASSESSMENT-2013/4.%20Country%20Risk%20Rating%202013.pdf

UK is rated as number 7 in the country risk rating. This means that UK is not very risky

http://www.developingfinance.org/download/COUNTRY-RISK-ASSESSMENT-2013/4.%20Country%20Risk%20Rating%202013.pdf

KEI (Knowledge-based Economy out of 10)

Australia has been practicing knowledge-based economy with many universities and institutions providing higher education to her citizens. The country is ranked as number 9 with KIE of 8.88

http://siteresources.worldbank.org/INTUNIKAM/Resources/2012.pdf

The knowledge-based economy just began after countries like Australia set high education institutions in Malaysia. It is ranked as number 48 and has a KIE of 6.1

http://siteresources.worldbank.org/INTUNIKAM/Resources/2012.pdf

United Kingdom has a high level of knowledge-based economy. The country has KIE of 8.76 and ranked as number 14

http://siteresources.worldbank.org/INTUNIKAM/Resources/2012.pdf

Global Competitiveness Ranking (out of 133)

Australia is ranked as 17th in the global competitiveness. Meaning that, it puts much effort to compete with other countries globally

http://says.com/my/news/malaysia-is-the-12th-most-competitive-nation

Malaysia is ranked as 12th in the global competitiveness. This shows that Malaysia is very active in competing with other global nations

http://says.com/my/news/malaysia-is-the-12th-most-competitive-nation

United Kingdom is ranked as 16th in the world competitiveness. It is evident that, UK is number 16 in its competitiveness effort in the global business.

http://says.com/my/news/malaysia-is-the-12th-most-competitive-nation

Corruption Perceptions Index (Ranking out of 180)

Australia is ranked as 9 with corruption perception index (CPI) score of 8.8. This means that, Australia is very corrupt.

http://www.nationsonline.org/oneworld/corruption.htm

Malaysia is number 39 with CPI score of 5.1. It is clear that, Malaysia is not very corrupt.

http://www.nationsonline.org/oneworld/corruption.htm

UK is ranked as number 12 with CPI score of 8.6. From the data, it is evident that, corruption activities are present in the country, but not very much.

http://www.nationsonline.org/oneworld/corruption.htm

Information & Technology Networked Readiness Ranking (out of 134)

Australia is ranked as 18 with a score of 5.26. Meaning that information and technology are applied well in Australia to do business

http://www3.weforum.org/docs/GITR/2013/GITR_OverallRankings_2013.pdf

Malaysia is ranked as number 30 with a score of 4.82. This is an indicator that, Malaysia is well networker in the form of information and technology.

http://www3.weforum.org/docs/GITR/2013/GITR_OverallRankings_2013.pdf

UK is ranked as number 7 with a score of 5.64. It is clear that the UK highly applies information and technology network in many business activities.

http://www3.weforum.org/docs/GITR/2013/GITR_OverallRankings_2013.pdf

Compare your FIRST IMPRESSIONS of these three countries based on the data given above. (200 words)

United Kingdom has the best rank compared to Australia and Malaysia. It is followed by Australia then Malaysia. According to the data above, my impression of the three countries is that, United Kingdom is better for an international business then the Australia and worst place is Malaysia. It is clear that, apart from being developed country, United Kingdom has low level of risk and its global competitiveness is high. It has a high level of knowledge-based economy and high score of information and technology networked readiness. Australia is the second best country because its rakings is average. Australia has low level of corruption, high score of information and technology networked readiness. Australia is also a developed country because of its high level of GDP and it is one of the top global economies. Being a developing country, Malaysia is a good country with very low risk level, but it is very corrupt meaning that doing business there has to cost a lot because of corruption. Comparing the three countries, United Kingdom is the best country to do business at, because there is a focus for a high-quality future and the country is well managed economically and with high intensity of information and technology readiness.

ECONOMIC INDICATORS

IS THIS COUNTRY WEALTHY, PRODUCTIVE & GROWING?

GDP per capita in $US per annum

2013: GDP- 37,492.85

GDP PPP- 42809.93 US dollars. This means that, Australia has a very high GDP per capita meaning that businesses perform well; hence very wealthy.

http://www.tradingeconomics.com/australia/gdp-per-capita-ppp

2013- 17,775.70 US Dollars. It is clear that the country is growing at an excellent rate.

http://www.economywatch.com/economic-statistics/economic-indicators/GDP_Per_Capita_PPP_US_Dollars/

2013- 37,501.70 US Dollars. This means that the UK is very productive and has high-quality wealth.

http://www.economywatch.com/economic-statistics/economic-indicators/GDP_Per_Capita_PPP_US_Dollars/

Inflation rate %

Third quarter of 2014- 2.30%

From 1951-2014 –average of 5.22%. This means that, Australia is not much affected by inflation

http://www.tradingeconomics.com/australia/inflation-cpi

2014- 2.60%

From 1973-2014- 3.71 average. It is clear that, the effect of inflation is not very high in Malaysia.

http://www.tradingeconomics.com/malaysia/inflation-cpi

2014- 1.20%

Average- 1989-2014- 2.77%. It is evident that the rate of inflation is very low thus not influential to the businesses.

http://www.tradingeconomics.com/united-kingdom/inflation-cpi

Interest rate %

(Prime Lending Rate)

August 2013- 2.50%

1990-2014- average of 5.24%. It is clear that, in Australia, the prime lending rate is favourable.

http://www.tradingeconomics.com/australia/interest-rate

2014- 3.25%

Average from 2004-2014- 2.94%. This means that Malaysia has a very good prime lending rate leading to growth of businesses in the country

http://www.tradingeconomics.com/malaysia/interest-rate

The interest rate is 0.50% -2014

Average 1971-2014- 8.02%. From the figures, it is clear that, the prime lending rate in the UK is favourable for a business.

http://www.tradingeconomics.com/united-kingdom/interest-rate

Is the currency overvalued or undervalued? (Big Mac Index)

The Australian dollar is overvalued in the real effective exchange rate (REER) whereby it is overvalued by around 12%. This means that, its exchange rate is high.

http://www.forexfactory.com/news.php?do=news&id=410593

The Malaysian ringgit is undervalued by 53% as per the dollar and on the Big Mac index. This is an indicator that, the exchange rate of Ringgit is very low.

http://www.economist.com/node/581914

According to Bid Mac index, Pound is overvalued by 22% against the US dollar. This means that, pound is well exchanged with a dollar.

http://avc.com/2010/07/purchasing-power-parity/

Annual GDP Growth Rate

Actual (%)

2014- 3.10%. This means that, the rate of growth of annual GDP is high, thus making the country wealthy

http://www.tradingeconomics.com/australia/gdp-growth-annual

2014- 5.60%. This shows that Malaysia is growing at a very high rate since its annual GDP is growing at a high percentage.

http://www.tradingeconomics.com/malaysia/gdp-growth-annual

2014-2.30%. It is clear that UK has an average annual GDP growth rate because it is a wealthy country.

http://www.tradingeconomics.com/united-states/gdp-growth-annual

BUSINESS INDICATORS

Tax rate ranking

Doing Business: (out of 183)

Ranked as 44 with tax rate of 47%. This means that, people are taxed highly in the country as they institute their businesses

http://www.pwc.com/gx/en/paying-taxes/data-tables.jhtml

Ranked as number 36 with tax rate of 36.2%. this means that the rate of tax is standard for one to do a business in the country. http://www.pwc.com/gx/en/paying-taxes/data-tables.jhtml

Ranked as 14 with tax rate of 34.0%. It is evident that in the UK, tax for running business is squat.

http://www.pwc.com/gx/en/paying-taxes/data-tables.jhtml

Ease of doing business ranking (out of 183)

Ranked as number 10. This means that doing business in Australia is easy and not complicated.

http://www.doingbusiness.org/rankings

Ranked as 18. This means that it is not very easy for one to do a business in Malaysia, but there are some challenges faced

http://www.doingbusiness.org/rankings

Ranked as number 8. This means that it is very easy for one to do a business in the UK because of easy business conditions

http://www.doingbusiness.org/rankings

Procedures/days to opening a business

Days 2.5. This means that, starting business in Australia requires only three days because it is easy.

http://www.doingbusiness.org/data/exploretopics/starting-a-business

Days 5.5. This means that, one has to spend almost six days preparing to establish a business.

http://www.doingbusiness.org/data/exploretopics/starting-a-business

Days 6.0. This is clear that, starting a superior business has to take six days in the UK.

http://www.doingbusiness.org/data/exploretopics/starting-a-business

Trading Across Borders Ranking

(importing/exporting, out of 183)

Ranked as number 49. This means that, Australia is not of high-quality at doing business across borders.

http://www.doingbusiness.org/data/exploretopics/trading-across-borders

Ranked as 5. it is clear that, Malaysia is of first-class at doing business across the borders.

http://www.doingbusiness.org/data/exploretopics/trading-across-borders

Ranked as number 15. this is an indicator that, UK engages in businesses across the borders.

http://www.doingbusiness.org/data/exploretopics/trading-across-borders

Coface Business Climate Rating (A,B,C,D)

Ranked as A2, A1. This means that there is a good business climate in Australia.

http://www.coface.com.au/Economic-Studies/Rating-table/%28ca%29/198

Ranked as A2, A3. It is clear that, the business climate is not very superior in Malaysia.

http://www.coface.com.au/Economic-Studies/Rating-table/%28ca%29/198

Ranked as A2, A1. This shows that, there is a very excellent business climate in the UK.

http://www.coface.com.au/Economic-Studies/Rating-table/%28ca%29/198

Compare the three countries’ BUSINESS ENVIRONMENT and ECONOMY based on the data given above. (200 words)

The business environment and economy in the three countries is excellent, but the best country with an effective business environment is the United Kingdom. This is because this country has high interest rate, thus favouring the investors. It’s currency is overvalued compared to the US Dollar; hence, having favourable value for the investors to manage their business. United Kingdom is superior at trading across the borders and it is easy for one to do business in the country because of easier and manageable business terms and conditions. Malaysia is the second country best for doing business and the last one being Australia as per the above results. This is where doing business across the border to more improved in Malaysia compared to Australia, thus making Malaysian business people to benefit from foreign exchange and wider market for their business goods and services. In addition, doing business in Malaysia is recommendable because of the average tax rate and it takes few days for one to start a business and make some moves in the business. Doing business in Australia is recommendable because its currency is overvalued and its annual GDP is high. In general, United Kingdom is the best country to do business compared to Malaysia and Australia.

SOCIO-CULTURAL FACTORS

Adult literacy rate

Actual (%)

Has a literacy percentage of 99%. This means that, majority of adults are educated.

http://www.indexmundi.com/g/r.aspx?v=39

88.75%. It means that, very many people go through formal education up to a high level.

http://www.indexmundi.com/g/r.aspx?v=39

99%. This indicates that, almost all adults are well educated with high education in the UK.

http://www.indexmundi.com/g/r.aspx?v=39

School life expectancy in years

Number of compulsory years- 21- 2013. It shows that, many people in Australia go to school for more than 21 years.

http://www.photius.com/rankings/population/school_life_expectancy_total_2013_0.html

13 years. This means that, in Malaysia people go to school for over 13 years.

http://www.photius.com/rankings/population/school_life_expectancy_total_2013_0.html

16.years 2013. It is clear that, in the UK, majority of people spends over 16 years in school for studies.

http://www.photius.com/rankings/population/school_life_expectancy_total_2013_0.html

HEALTH AND WELFARE

WELLBEING OF PEOPLE

Unemployment rate %

Unemployment rate as percentage of labour force in 2013 is 5.297% meaning that many people in Australia are employed

http://www.economywatch.com/economic-statistics/economic-indicators/Unemployment_Rate_Percentage_of_Labour_Force/

3% is the unemployment rate in Malaysia, thus majority of Malaysians have employment

http://www.economywatch.com/economic-statistics/economic-indicators/Unemployment_Rate_Percentage_of_Labour_Force/

7.826%. This is the unemployment rate in the UK and shows that a significant number of people are employed, hence, well-up.

http://www.economywatch.com/economic-statistics/economic-indicators/Unemployment_Rate_Percentage_of_Labour_Force/

Life expectancy in years

The life expectancy in 3013 was;

Female; 84

This means that, one is expected to live a longer life in the country.

http://www.prb.org/DataFinder/Topic/Rankings.aspx?ind=6

The life expectancy is

Female; 77

It is clear that, many people do not die very young.

http://www.prb.org/DataFinder/Topic/Rankings.aspx?ind=6

The life expectancy is

Female; 83

This shows that, in the UK, many people live for more than 79 years

http://www.prb.org/DataFinder/Topic/Rankings.aspx?ind=6

% of population below the poverty line

13.9%. This means that, in Australia, only 13.9% are poor, but the rest are well of.

http://www.indexmundi.com/g/r.aspx?v=69

3.8%. This is a clear indicator that, in Malaysia, few people live a poor life http://www.indexmundi.com/g/r.aspx?v=69

14%. This means that only 14% of the people in the UK are poor.

http://www.indexmundi.com/g/r.aspx?v=69

Human Development Index

(Normalised out of 10)

The HDI is 0.933 -2 degrees. This indicates that, in Australia, there is high human development.

http://countryeconomy.com/hdi

The human development index (HDI) in Malaysia is 0.773- 62 degrees. It is a sign that, Malaysia has a high level of human development

http://countryeconomy.com/hdi

The HDI is 0.892 which is 14 degrees. The figure shows that, in the UK, there is realized level of human development.

http://countryeconomy.com/hdi/uk

Environmental Performance Index Ranking (out of 163)

Ranked as 3rd. This makes it clear that, Australia is a significant place for a business to perform well.

http://www.trade.nsw.gov.au/invest-in-nsw/about-nsw/excellent-lifestyle/environment

Ranked as 5th. It is evident from that ranking that, Malaysia has a high-quality and favourable environment for a business to achieve.

http://www.trade.nsw.gov.au/invest-in-nsw/about-nsw/excellent-lifestyle/environment

Ranked as 9th.. This means that UK is a country with high-quality business environmental performance

http://www.trade.nsw.gov.au/invest-in-nsw/about-nsw/excellent-lifestyle/environment

Compare the three countries for HEALTH & WELFARE/ SOCIO-CULTURAL factors based on the data given above. (200 words)

Among the three countries, Australia is the best country with a good and effective environment of doing business because of favourable health and welfare. Australia has stumpy percentage of population below the poverty line and average unemployment rate and the life expectancy is very high. The country has improved socio-cultural factors and people welfare. The second country that is paramount in doing business compared to the above results is Malaysia and the third one among the three is the United Kingdom. Malaysia has very minimal percentage of people below the poverty line, and the schools life expectancy is high. The environmental performance of Malaysia is average in the form of health, thus making it easier for business people to open and run businesses in the country as they expect to be in first-class quality health and welfare. United Kingdom is an excellent country in running a business because it has very elevated adult literacy rate, thus making the general literacy of the country to be high, hence, improved welfare. Doing business in the three countries is recommendable because there is consideration of welfare and health of the business people, but comparing the three countries, Malaysia is the best country followed by Australia, then the United Kingdom in the level of health and welfare.

OVERALL TOTAL SCORE

Australia: Best

FINAL SCORE: 35

Malaysia: Worst

FINAL SCORE: 39

United Kingdom: Good

FINAL SCORE: 36

TOTAL SCORE

United Kingdom

Australia

Malaysia

Which country is the best country for starting a new business? Why have you chosen this country out of the three countries that you compared?

The best country to start a business among the three countries, that is; Australia, United Kingdom, and Malaysia, is Australia having compared the above outcomes and their ranking. This is because it is a developed country with a favourable business environment for one to start and run a business. The currency of Australia is overvalued, the rate of corruption is low, and adult life expectancy is high. The interest rate in Australia is sky-scraping and comparing all the factors among the three countries, Australia has more pros compared to the cons or the best scores compared to the other two countries. The economy in Australia is very high globally compared to other countries and it has favourable economic indicators of a new business. Australia is highly ranked among the three countries because the country data, health and welfare, as well as its general economy are favourable for one to start a business.