Incomplete Paper needs Recommendation and a Table-DUE: Tonight

Team Assignment #1

Argentina vs. Brazil; Analysis of the Food Market

Group: MBA All Stars

Dr. Ezz

02/07/2017

Table of contents

Cover page ……………………………………………………………………………………… 1

Table of contents ……………………………………………………………………………….. 2

Executive summary …………………………………………………………………………….. 2

Introduction …………………………………………………………………………………….. 3

Acceptable political, economic, legal and ethical environments ………………………………. 4

Infrastructure …………………………………………………………………………………… 7

Cultural environment …………………………………………………………………………… 9

Conclusion …………………………………………………………………………………….. 10

References …………………………………………………………………………………….. 12

Executive summary

The article written below is an analysis of the food market in Brazil and Argentina, the report has been prepared for an executive of a multinational company that would want to explore the country for business purposes. The vivid illustrations provided in the essay are subdivided into the individual country and aspects endowed in the countries discussed in detail to educate the reader of the current state of the nation. The organic foods market is heavily developed in both the countries and inclusion of technology is an added advantage due improve on effectiveness and efficiency (Gannon & Pillai, 2013). Both countries have set up structures and foundations that make them one of the biggest exporters of organic products in the world. The countries are endowed with a lot of resources that include rivers, land, expertise, water coverage and climatic advantages that make them ideal places to set up such a venture.

Therefore, the essay begins with a brief introduction of the countries under discussion, areas covered include; geographical positioning, climate, resources and market forces that are at work in both countries. Then essay describes the political, economic, ethical and legal environments present in both the countries separately to vividly the factors that affect the countries. The analysis is accompanied by a brief illustration of the nation's food market factors and status inform of a historical background to help the reader create current mental pictures (Gannon & Pillai, 2013). Then the paper goes a step further to compare the infrastructure of both countries where various factors of technological developments and growth are described. The cultural background of the people in these countries is well illustrated at the bottom to depict the kind of environment that the staff of the multinational company comes to terms with if they decide to open a branch in these nations.

Introduction

Argentina; located in South America it borders Bolivia, Chile, Brazil, Uruguay and Paraguay. The Atlantic Ocean is situated in the east while the Andes Mountains to the west and the country is in the middle (Bao, 2016). It's a beautiful country with a variety of climates; in the north is Tropical and in the south is Tundra. It’s a republic nation rich in resources, an educated workforce and has one of the largest economies on its continent. Brazil; the biggest country in the South American continent, surrounded by the Atlantic to the east its most substantial portion of land is covered by the Amazon forest (Levin, 2011). It's a republic nation with a democratic government and has a market economy where the prices of products are judged by the laws of supply and demand. Formerly it was a Portuguese colony; the latter is a mixed race country with a variety of domestic American and African slaves. It is a rising economic power; however, the exploitation of the rainforest is a primary concern since it controls the country's climate.

Part A - Do the countries have acceptable economic, political, ethical and legal environments?

Historical background of the organic market in Argentina

In the year nineteen eighty-five, the Canecos was established in Argentina which was the first association that dealt with organic agriculture. It was in nineteen ninety at a trade congress held in Vienna some of the farmers from Argentina came to hear about the large market gap in the organic sector. This influenced their desire to satisfy this market; they cease their regular agricultural activities embarked on a plan to grow and sell globally organic foods (Lockeretz, 2007). Gradually more land was dedicated to organic agriculture; today Argentina accounts for eighty percent of the total organic export in the world. Today the market is characterized by large corporate farms and ranches some of which go up to a million hectares; family owned land of about one hundred hectares which fully practice organic farming. Their primary produce is corn, wheat, sorghum, and cotton.

Pestel Analysis of the market

The economy of Argentina has been gradually on the rise from facing an economic crisis at the beginning of the millennium its annual GDP is growing at nine percent every year. Traditionally, the primary business in the country was farming today they are regarded as the top producers of corn and wheat in the world. The economic environment is one of the best in the South American states due to the financial help boosted into the nation by countries such as Japan, U.S.A, Spain, Canada, and Germany (Lichtfouse, 2009). To date it hosts big corporations giving jobs to thousands of people in the country, these industries include; real estate, construction, transportation, mining, and telecommunication. These cumulative advantages make it an ideal place to start or invest in a small business where the economic environment is favorable to a young business. However, the political climate in the past was characterized by corruption and business harassment; to date the country is getting a fresh look from investors due to the increase in the Mervel stock by one hundred and sixty three percent.

The technological environment is characterized by a great dichotomy between urban areas and the rural areas. One may notice as you move away from the major cities and town the population is still living in a conventional traditional form. While the road network in major cities has been developed in the rural areas little of this is evident and lack of equilibrium in the infrastructure of the nation (Lichtfouse, 2009). From the facts stated above it is true to say that the country has adopted a more ambivalent view towards technological enhancement. The principle environmental issues rest on the shoulders of the Ministry of Health and Environment where they create laws that govern use of public land and health risks to both the country and the environment. The main issues for consideration are pollution, loss of agricultural land, soil erosion, salinization and deforestation.

Historical background of the organic market in Brazil

Brazil; success in the agricultural market made the nation get the acknowledgement of the bread basket of the world. Between the nineteen sixty and nineteen eighty the country experienced an industrial revolution where they aimed to reduce imports and increase production of locally manufactured goods. The pressures of this new regime brought added responsibilities in the food sector where it was forced to expand and supply goods not only to the local market but also to foreign markets around the world (Shurtleff & Aoyagi, 2009). As time went by the country realized that there was limited land for expansion, this problem required fresh thinking into new fields of modern scientific advances. As of the year two thousand and nine the country was estimated to have a hundred million hectares of undeveloped land, a size so big it could fit France and Spain together. Brazil majors on sugar cane, coffee, soya beans and ethanol.

Pestel analysis of the market

The government of the day is proactive and stable; the country is at state of political stability but this is not certain; elections in the country spark up bitter rivalry and may culminate to a nationwide distress. Corruption is still a major concern in the country and it is gradually creeping into the system as it may need you to pay the officials before opening a business in the country (Bilderback, 2010). The country has a large population and taking into the account the amount of money siphoned into the country is makes it an ideal place for rapid growth. There is still a large gap between the rich and the poor but there is a rising middle class and the country has controlled its currency from further depreciation due to inflation. Domestic and Foreign companies are treated with the same regards and labor is readily available and at cheaper rates.

Economic inequality is evidenced in the country; twenty percent of the population in the country lives in object poverty while there are a great number of wealthy people in the country and the middle class is on a gradual rise. However, Brazilians are considered urban people; the major international brands are present in the nation are they are up to date with recent and upcoming events about the rest of the world (Rothaermel, 2012). Compared to other developed countries the technology in the country is at a minimal; however, there is a motion to start technological centers around the country to educate the natives on modern devices. To encourage production of organic foods the company has come up with an incentive program where the farmers are given cash discounts to enable them to carry out production of food. The country also has a unique export program set in place by the Brazilian Trade and Investment Promotion Agency.

Comparison and choice

Argentina and Brazil do have acceptable standards; however, their political environment is characterized by corruption which is on a gradual increase and in Brazil it’s much worse where you will have to pay officers to get business permits in the country. The economies of the country are stable and gradually on the increase; the presence of the organic food market in both countries is a big economic boost. Both countries have arable land but in Brazil the biggest chunk of the country is occupied by the Amazon forest while in Argentina which is a continental plain has vast chunks of land that are fertile and good for farming (Bilderback, 2010). This very factor of available land is the incentive to which should lure investors to invest in this country. Brazilian farmers receive incentives and have corporations created to find ready market for produce abroad which is a very big advantage.

Part B - Do the countries have suitable infrastructure? Is one location in a country more suitable for the industry than another?

Argentina

The road network present in the country accounts for two hundred and fifteen thousand four and fifty kilometers this is a very small portion of the country since the country is immensely large. Four hundred and fifty-six miles from the total is the amount that express ways and highways take up on the map. It has ten thousand nine hundred and fifty kilometers of navigable rivers; however, many of the countries ports are located along the Atlantic Ocean (Foster & Garmendia, 2010). There is also an extensive railway network that accounts for carriage of freight and individuals it covers thirty-eight thousand three hundred and twenty-six kilometers. The capital city has extensive infrastructural developments with extensive system of public transportation that include; subways and buses but the railway network is mostly preferable by the population. For the most part the country enjoys internet coverage more than two thirds of the country is connected while mobile usage is growing rapidly.

Brazil

Road network remains to be the primary means of transport around the country; the country boasts of eighty percent of the nation being covered by tarmac. However, the ever-increasing demand for this service renders its road infrastructure ineffective; thus, the country faces a lot of traffic jams and congestion. The country has a well-developed rail network which is divided into four; broad, narrow, dual and standard gauge (Frazzon, 2009). The air transport in the country is highly developed; the nation has a total of three hundred airports, fifty being major commercial ports and in turn twenty-one of them are to international standards. Most of their electricity is supplies by hydroelectric plants while other sources include; fossil fuel and nuclear energy. Telecommunications networks are well developed and organized in the country; it encompasses landlines, mobile phones, television and radio broadcasting, computer and readily available internet access. The nation is also endowed with big rivers that account for fifty thousand kilometers of navigable water ways.

Comparison and choice

Above is detailed explanation of the infrastructural structure of the country; from the information provided it is easy to decipher and know which the better option is. You may tend to think so, but it is however different since one is not comparing what he sees it is rather the culture of these two countries. Brazil is a nation that is endowed with many advantages and developments; the nation is rich and it well developed and organized (Frazzon, 2009). The infrastructure and telecommunication are state of the art and it serves the country justice; however, this is a major influence of culture, western influence and rapid growth. Argentina is a developing country where the population is more traditional and more rooted to their culture and the population has lived in such a structure for decades and they have adapted and liked to live that way. However, the country is underdeveloped and very large, if the country had good infrastructure it would be the best choice for this section.

Part C - What cultural environment will the staff of the MNE encounter in the workplace of the two countries?

Argentina

As at July twenty fourteen the population of the country was forty three million where ninety seven percent of the country is white mainly Italians and the Spanish, the rest of the population is mestizo, Amerindian and other colored people. The argentine way of life is centered on family and extended families still have great dominance; heads of powerful families command widespread respect and honor (Seymoure & Roberg, 2012). Christianity is the main religion in the country where most of the country is deeply rooted in the structure of worship from the Roman Catholic Church. The country mainly speaks Spanish but the people refer to it as Castilian language that symbolizes the exact place which it was birthed in Spain. Argentines are open, blunt and direct in their business negotiations but they are still able to maintain a tactful and diplomatic outlook. In addition there are close communicators physically therefore you will see a lot of touching and kissing in their encounters.

Brazil

The Brazilian culture is one of the most diverse on the planet due to the different nationalities present as a result of years of western domination and slavery that brought in hordes of people from different parts of the world. At the time the current population in Brazil was one hundred, and ninety millions of these sixty percent was white and forty percent was multi colored. Eighty percent of the population is catholic this is due to the intense previous Portuguese rule in the nation where they taught the religion, built churches and established traditions and customs that are followed up to this very day (Lohmann & Dredge, 2012). In the sixteenth, seventeenth and eighteenth centuries the country faced a lot of Portuguese settlement that made the official language to be the same. The population also shows deep entrenchment in family therefore you find large families that work on a common structure and values.

Conclusion

Brazil and Argentina are the two largest economies in South America; comparison of these two countries is a weighty task but in light of the facts laid at the beginning of this essay, it is not entirely difficult. The two countries are welcoming to new investors and both have the capability of achieving targets and objectives of companies that would like to venture into this market (Meyer, 2014). Notable characteristic in the Argentine market is that the country has a very small population that attributes to a very big portion of land; for any company that would love to venture into the food business the country is capable of offering the desired amount of land for cultivation. Brazil employs the help of technological advancement to grow their crops but in Argentina this is not the case since the country is arable and very fertile; therefore only organic foods are grown in the country. As a choice in this segment, I would be inclined to choose Argentina but it has limitations such as poor infrastructure.

References

Bao, S. (2016). Argentina. Carlton, Victoria, Australia Oakland, CA London: Lonely Planet Publications Pty. Ltd.

Bilderback, L. (2010). The everything bread cookbook. Avon, Mass: Adams Media.

Foster, V. & Garmendia, C. (2010). Africa's infrastructure: a time for transformation. Washington, DC: Agence Française de Développement World Bank.

Frazzon, E. (2009). Sustainability and effectiveness in global logistic systems. Berlin: Gito.

Gannon, M. & Pillai, R. (2013). Understanding global cultures: metaphorical journeys through 31 nations, clusters of nations, continents, and diversity. Thousand Oaks, Calif: Sage Publications.

Levin, I. (2011). The Boys from Brazil. London: Constable & Robinson.

Lichtfouse, E. (2009). Organic farming, pest control and remediation of soil pollutants. Dordrecht New York: Springer.

Lockeretz, W. (2007). Organic farming: an international history. Cambridge, MA: CABI.

Lohmann, G. & Dredge, D. (2012). Tourism in Brazil: environment, management and segments. Milton Park, Abingdon, Oxon New York: Routledge.

Meyer, E. (2014). The Culture Map: Breaking Through the Invisible Boundaries of Global Business. New York: PublicAffairs.

Rothaermel, F. (2012). Strategic management: concepts. New York: McGraw-Hill Create.

Seymoure, P. & Roberg, J. (2012). Tourism in northeastern Argentina: the intersection of human and indigenous rights with the environment. Lanham, MD: Lexington Books.

Shurtleff, W. & Aoyagi, A. (2009). History of soybeans and soyfoods in South America (1882-2009: extensively annotated bibliography and sourcebook. Lafayette, CA: Soyinfo Center.