A Responsibility Of International Business - Myassignmenthelp.Com

Question: Discuss about the A Responsibility Of International Business. Answer: Introduction Switzerland has consistently remained one of the most developed and sustainably economically progressive countries in the global framework. The different macroeconomic factors of the country in the recent times are as follows. Macroeconomic Factors The GDP of Switzerland in 2016 has been 659.8 billion USD (Rudolf and Zurlinden). The growth of GDP has been as follows: Figure 1: GDP of Switzerland over the years (2008-2016) (Source: Tradingeconomics.com) The GDP per capita of the country in 2016 has been 75725.65 USD, with the change in the same over the years being as follows: Figure 2: Per capita GDP of Switzerland (2008-2016) (Source: Tradingeconomics.com) The growth rate of GDP in Switzerland has been 0.6% in 2017, with the change in the same being as follows: Figure 3: Growth rate of GDP in Switzerland (2015-2017) (Source: Tradingeconomics.com) The government spending in Switzerland has constantly increased over the years, with the same being 19934.98 million Swiss Franc in July 2017. The growth of the same has been as follows: Figure 4: Government Spending of Switzerland (2015-2017) (Source: Tradingeconomics.com) The rate of inflation has been increasing gradually in 2017, with the rate being 0.8% by October 2017. The change in the rate has been as follows: Figure 5: Inflation rate in Switzerland (2014-2017) (Source: Tradingeconomics.com) The current household rate of savings in Switzerland is nearly 13.7% with the same experiencing considerable fluctuations which can be shown as follows: Figure 5: Household Savings Rate in Switzerland (2008-2016) (Source: Tradingeconomics.com) Switzerlands Foreign Direct Investment has consistently increased over the years which is shown as follows: Figure 6: Foreign Direct Investment (Switzerland) (2008-2016) (Source: Tradingeconomics.com) Main Investment Opportunities in Switzerland The economy of Switzerland has been an example of consistently growing one, with very less dramatic fluctuations. Several sectors and industries of the country has already reached their saturation and there are very little scopes for expansion in such sectors, thereby indicating that investing in those sectors may not be that profitable. However, the country has several sectors in which there are still scopes of huge expansion. One of such sectors is the real estate sector. With the demand for more and more residential assets as well as commercial buildings for the purpose of offices, shopping centers, stadiums, hotels and others, this sector shows the presence of considerable investment opportunities. Apart from this sector, there are opportunities of investment in the newly growing bio-technology industry, the service sector (which contributes more than 70% in the countrys GDP), the infrastructural sector and the watch industry which experiences consistent demand in the contemporar y period. Level of Corruption Switzerland is one of the least corrupt countries in the world, ranking as the fifth least of the corrupt nations among the 176 countries, measured in the Corruption Perception Index (2016). The changes in the corruption rank over the years for the country can be seen from the following figure: Figure 7: Corruption Rank of Switzerland over the years (Source: Tradingeconomics.com) As per the above figure, the government has been effective to keep corruption visibly low in Switzerland. However, sometimes there arises difference between the data and the perceptions of the residents of the country. As per the Transparency International Global Barometer almost 58% of the interviewed households perceive that corruption has remained unchanged while 28% perceive that corruption in the country has increased. Corruption is perceived to be more in political environment than in the business and industrial environment. Crisis in Switzerland The financial framework of the country has been quite stable for the last few decades with no significant economic turmoil. However, with the recent Euro crisis and the accompanying decision of Swiss National Bank, of scrapping a cap in the local currency value against that of Euro, the country is expected to go through a rough phase of economic crisis. Apart from that, with the increasing inflow of immigrants from across the world to the country is also leading to a form of social and economic crisis for the country in the contemporary period (Obstfeld). Fiscal and Monetary Policies The policy framework in Switzerland is impressively stable and effective, with least tensions and scope of conflict between the fiscal policies and the monetary policies. The country enjoys the presence of robust public finance and stability targeted monetary policies. The strict policy regime and regulations keep the political and the economic structures working in an efficient manner. The fiscal and monetary policy framework of the country helps it to combat any kind of crisis situations. Unemployment Rate The rate of unemployment in the country, has reached a six months high to 3.1% by the third quarter of 2017, after a period of lower and stable rate: Figure 8: Rate of Unemployment in Switzerland (2015-2017) (Source: Tradingeconomics.com) Governments plan of action The unemployment rate remaining comparatively low, the government works effectively in creating enough employment scopes. There are also privileges like unemployment benefit and other supports for those who are eligible to work but are unemployed. Employment generation programs are also taken up efficiently. Switzerland from Risk Standpoint With consistently high income, robust GDP growth, large surpluses in the current account, fiscal and monetary stability and moderate public debt which amounts to 35% of the GDP, the economy of Switzerland is one of the most stable one in the global framework and is seen as a low risk country from the global perspective (Helbing). Market Interest Rate The interest rate in Switzerland has been negative (-0.75%), in the current period, with the changes being as follows: Risk Factors With the interest rate of the country running at a negative rate, there remains a considerable market risk for the currency reserves, which includes the risk in the exchange rates. There also remain liquidity and credit risks in the countrys economy (Source: Snb.ch). Ethical standards and Sustainability Switzerland has been progressing impressively with regards to ethical standards and corporate responsibility in the commercial framework. The government, through its interim report (2015), has announced the implementation of a four year program, under the State Secretariat for Economic Affairs (Kolk). The purpose of this plan is to create awareness among the commercial players to take corporate social responsibilities and abide by the ethical and transparency norms which have been designed to promote a sustained growth of its business environment and the overall economy. References Helbing, Dirk. "Globally networked risks and how to respond."Nature497.7447 (2013): 51-59. Kolk, Ans. "The social responsibility of international business: From ethics and the environment to CSR and sustainable development."Journal of World Business51.1 (2016): 23-34. Obstfeld, Maurice. "Finance at center stage: some lessons of the euro crisis." (2013). Rudolf, Barbara, and Mathias Zurlinden. "A compact open economy DSGE model for Switzerland."Swiss National Bank Economic Studies8 (2014). Snb.ch. "Swiss National Bank (SNB) - Investment Risk Profile."Snb.ch. N.p., 2018. Web. 5 Jan. 2018. Tradingeconomics.com. "Switzerland Corruption Rank | 1995-2018 | Data | Chart | Calendar."Tradingeconomics.com. N.p., 2018. Web. 5 Jan. 2018. Tradingeconomics.com. "Switzerland Foreign Direct Investment | 1985-2018 | Data | Chart | Calendar."Tradingeconomics.com. N.p., 2018. Web. 5 Jan. 2018. Tradingeconomics.com. "Switzerland GDP Growth Rate | 1980-2018 | Data | Chart | Calendar."Tradingeconomics.com. N.p., 2018. Web. 5 Jan. 2018. Tradingeconomics.com. "Switzerland Household Saving Rate | 1990-2018 | Data | Chart | Calendar."Tradingeconomics.com. N.p., 2018. Web. 5 Jan. 2018.